[Federal Register Volume 84, Number 249 (Monday, December 30, 2019)]
[Rules and Regulations]
[Pages 71735-71737]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-28053]


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DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency

12 CFR Parts 19 and 109


Notification of Inflation Adjustments for Civil Money Penalties

AGENCY: Office of the Comptroller of the Currency, Treasury.

ACTION: Notification of monetary penalties 2020.

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SUMMARY: The Office of the Comptroller of the Currency (OCC) is 
providing notice of its maximum civil money penalties as adjusted for 
inflation. The inflation adjustments are required to implement the 
Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by 
the Federal Civil Penalties Inflation Adjustment Act Improvements Act 
of 2015.

DATES: The adjusted maximum amount of civil money penalties in this 
document are applicable to penalties assessed on or after January 1, 
2020, for conduct occurring on or after November 2, 2015.

FOR FURTHER INFORMATION CONTACT: Lee Walzer, Counsel, Chief Counsel's 
Office, (202) 649-5490, or, for persons who are deaf or hearing 
impaired, TTY, (202) 649-5597, Office of the Comptroller of the 
Currency.

SUPPLEMENTARY INFORMATION: This document announces changes to the 
maximum amount of each civil money penalty (CMP) within the OCC's 
jurisdiction to administer to account for inflation pursuant to the 
Federal Civil Penalties Inflation Adjustment Act of 1990 (the 1990 
Adjustment Act),\1\ as amended by the Federal Civil Penalties Inflation 
Adjustment Act Improvements Act of 2015 (the 2015 Adjustment Act).\2\ 
Under the 1990 Adjustment Act, as amended, federal agencies must make

[[Page 71736]]

annual adjustments to the maximum amount of each CMP the agency 
administers. The Office of Management and Budget (OMB) is required to 
issue guidance to federal agencies no later than December 15 of each 
year providing an inflation adjustment multiplier (i.e., the inflation 
adjustment factor agencies must use) applicable to CMPs assessed in the 
following year. The agencies are required to publish their CMPs, 
adjusted pursuant to the multiplier provided by OMB, by January 15 of 
the applicable year.
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    \1\ Public Law 101-410, Oct. 5, 1990, 104 Stat. 890, codified at 
28 U.S.C. 2461 note.
    \2\ Public Law 114-74, Title VII, section 701(b), Nov. 2, 2015, 
129 Stat. 599, codified at 28 U.S.C. 2461 note.
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    To the extent an agency has codified a CMP amount in its 
regulations, the agency would need to update that amount by regulation. 
However, if an agency has codified the formula for making the CMP 
adjustments, then subsequent adjustments can be made solely by 
notice.\3\ In 2018, the OCC published a final regulation to remove the 
CMP amounts from its regulations, while updating those amounts for 
inflation through the notice process.\4\
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    \3\ See OMB Memorandum M-18-03, ``Implementation of the 2018 
Annual Adjustment Pursuant to the Federal Civil Penalties Inflation 
Adjustment Act Improvements Act of 2015,'' at 4, which permits 
agencies that have codified the formula to adjust CMPs for inflation 
to update the penalties through a notice rather than a regulation.
    \4\ 83 FR 1517 (Jan. 12, 2018) (final rule); 83 FR 1657 (Jan. 
12, 2018) (2018 CMP Notice).
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    On December 16, 2019, the OMB issued guidance to affected agencies 
on implementing the required annual adjustment, which included the 
relevant inflation multiplier.\5\ The OCC has applied that multiplier 
to the maximum CMPs allowable in 2019 for national banks and Federal 
savings associations as listed in the 2019 CMP notice \6\ to calculate 
the maximum amount of CMPs that may be assessed by the OCC in 2020.\7\ 
There were no new statutory CMPs administered by the OCC during 2019.
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    \5\ The inflation adjustment multiplier for 2020 is 1.01764. See 
OMB Memorandum M-20-05, Implementation of Penalty Inflation 
Adjustments for 2020, Pursuant to the Federal Civil Penalties 
Inflation Adjustment Act Improvements Act of 2015 (Dec. 16, 2019).
    \6\ See 83 FR 66599 (Dec. 27, 2018).
    \7\ Penalties assessed for violations occurring prior to 
November 2, 2015, will be subject to the maximum amounts set forth 
in the OCC's regulations in effect prior to the enactment of the 
2015 Adjustment Act.
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    The following charts provide the inflation-adjusted CMPs for use 
beginning on January 1, 2020, pursuant to 12 CFR 19.240(b) and 
109.103(c)(2) for conduct occurring on or after November 2, 2015:

                 Penalties Applicable to National Banks
------------------------------------------------------------------------
                                                              Maximum
                                   Description and tier   penalty amount
       U.S. Code citation            (if applicable)       (in dollars)
                                                                \1\
------------------------------------------------------------------------
12 U.S.C. 93(b)................  Violation of Various
                                  Provisions of the
                                  National Bank Act:
                                    Tier 1..............          10,245
                                    Tier 2..............          51,222
                                    Tier 3..............   \2\ 2,048,915
12 U.S.C. 164..................  Violation of Reporting
                                  Requirements:
                                    Tier 1..............           4,098
                                    Tier 2..............          40,979
                                    Tier 3..............   \2\ 2,048,915
12 U.S.C. 481..................  Refusal of Affiliate to          10,245
                                  Cooperate in
                                  Examination.
12 U.S.C. 504..................  Violation of Various
                                  Provisions of the
                                  Federal Reserve Act:
                                    Tier 1..............          10,245
                                    Tier 2..............          51,222
                                    Tier 3..............   \2\ 2,048,915
12 U.S.C. 1817(j)(16)..........  Violation of Change in
                                  Bank Control Act:
                                    Tier 1..............          10,245
                                    Tier 2..............          51,222
                                    Tier 3..............   \2\ 2,048,915
12 U.S.C. 1818(i)(2) \3\.......  Violation of Law,
                                  Unsafe or Unsound
                                  Practice, or Breach of
                                  Fiduciary Duty:
                                    Tier 1..............          10,245
                                    Tier 2..............          51,222
                                    Tier 3..............   \2\ 2,048,915
12 U.S.C. 1820(k)(6)(A)(ii)....  Violation of Post-
                                  Employment
                                  Restrictions:
                                    Per violation.......         337,016
12 U.S.C. 1832(c)..............  Violation of
                                  Withdrawals by
                                  Negotiable or
                                  Transferable
                                  Instrument for
                                  Transfers to Third
                                  Parties:
                                    Per violation.......           2,976
12 U.S.C. 1884.................  Violation of the Bank               297
                                  Protection Act.
12 U.S.C. 1972(2)(F)...........  Violation of Anti-Tying
                                  Provisions regarding
                                  Correspondent
                                  Accounts, Unsafe or
                                  Unsound Practices, or
                                  Breach of Fiduciary
                                  Duty:
                                    Tier 1..............          10,245
                                    Tier 2..............          51,222
                                    Tier 3..............   \2\ 2,048,915
12 U.S.C. 3110(a)..............  Violation of Various             46,825
                                  Provisions of the
                                  International Banking
                                  Act (Federal Branches
                                  and Agencies).
12 U.S.C. 3110(c)..............  Violation of Reporting
                                  Requirements of the
                                  International Banking
                                  Act (Federal Branches
                                  and Agencies):
                                    Tier 1..............           3,747
                                    Tier 2..............          37,458
                                    Tier 3..............   \2\ 1,872,957
12 U.S.C. 3909(d)(1)...........  Violation of                      2,549
                                  International Lending
                                  Supervision Act.
15 U.S.C. 78u-2(b).............  Violation of Various
                                  Provisions of the
                                  Securities Act, the
                                  Securities Exchange
                                  Act, the Investment
                                  Company Act, or the
                                  Investment Advisers
                                  Act:
                                    Tier 1 (natural                9,639
                                     person)--Per
                                     violation.
                                    Tier 1 (other                 96,384
                                     person)--Per
                                     violation.
                                    Tier 2 (natural               96,384
                                     person)--Per
                                     violation.
                                    Tier 2 (other                481,920
                                     person)--Per
                                     violation.
                                    Tier 3 (natural              192,768
                                     person)--Per
                                     violation.
                                    Tier 3 (other                963,837
                                     person)--Per
                                     violation.
15 U.S.C. 1639e(k).............  Violation of Appraisal
                                  Independence
                                  Requirements:
                                    First violation.....          11,767
                                    Subsequent                    23,533
                                     violations.

[[Page 71737]]

 
42 U.S.C. 4012a(f)(5)..........  Flood Insurance:
                                    Per violation.......           2,226
------------------------------------------------------------------------
\1\ The maximum penalty amount is per day, unless otherwise indicated.
\2\ The maximum penalty amount for a national bank is the lesser of this
  amount or 1 percent of total assets.
\3\ These amounts also apply to CMPs in statutes that cross-reference 12
  U.S.C. 1818, such as 12 U.S.C. 2804, 3108, 3349, 4309, and 4717 and 15
  U.S.C. 1607, 1693o, 1681s, 1691c, and 1692l.


          Penalties Applicable to Federal Savings Associations
------------------------------------------------------------------------
                                                              Maximum
                                                          penalty amount
       U.S. Code citation            CMP description       (in dollars)
                                                                \1\
------------------------------------------------------------------------
12 U.S.C. 1464(v)..............  Reports of Condition:
                                    1st Tier............           4,098
                                    2nd Tier............          40,979
                                    3rd Tier............   \2\ 2,048,915
12 U.S.C. 1467(d)..............  Refusal of Affiliate to          10,245
                                  Cooperate in
                                  Examination.
12 U.S.C. 1467a(r).............  Late/Inaccurate
                                  Reports:
                                    1st Tier............           4,098
                                    2nd Tier............          40,979
                                    3rd Tier............   \2\ 2,048,915
12 U.S.C. 1817(j)(16)..........  Violation of Change in
                                  Bank Control Act:
                                    Tier 1..............          10,245
                                    Tier 2..............          51,222
                                    Tier 3..............   \2\ 2,048,915
12 U.S.C. 1818(i)(2) \3\.......  Violation of Law,
                                  Unsafe or Unsound
                                  Practice, or Breach of
                                  Fiduciary Duty:
                                    Tier 1..............          10,245
                                    Tier 2..............          51,222
                                    Tier 3..............   \2\ 2,048,915
12 U.S.C. 1820(k)(6)(A)(ii)....  Violation of Post-
                                  Employment
                                  Restrictions:
                                    Per violation.......         337,016
12 U.S.C. 1832(c)..............  Violation of
                                  Withdrawals by
                                  Negotiable or
                                  Transferable
                                  Instruments for
                                  Transfers to Third
                                  Parties:
                                    Per violation.......           2,705
12 U.S.C. 1884.................  Violation of the Bank               297
                                  Protection Act.
12 U.S.C. 1972(2)(F)...........  Violation of Provisions
                                  regarding
                                  Correspondent
                                  Accounts, Unsafe or
                                  Unsound Practices, or
                                  Breach of Fiduciary
                                  Duty:
                                    Tier 1..............          10,245
                                    Tier 2..............          51,222
                                    Tier 3..............   \2\ 2,048,915
15 U.S.C. 78u-2(b).............  Violations of Various
                                  Provisions of the
                                  Securities Act, the
                                  Securities Exchange
                                  Act, the Investment
                                  Company Act, or the
                                  Investment Advisers
                                  Act:
                                    1st Tier (natural              9,639
                                     person)--Per
                                     violation.
                                    1st Tier (other               96,384
                                     person)--Per
                                     violation.
                                    2nd Tier (natural             96,384
                                     person)--Per
                                     violation.
                                    2nd Tier (other              481,920
                                     person)--Per
                                     violation.
                                    3rd Tier (natural            192,768
                                     person)--Per
                                     violation.
                                    3rd Tier (other              963,837
                                     person)--Per
                                     violation.
15 U.S.C. 1639e(k).............  Violation of Appraisal
                                  Independence
                                  Requirements:
                                    First violation.....          11,767
                                    Subsequent                    23,533
                                     violations.
42 U.S.C. 4012a(f)(5)..........  Flood Insurance:
                                    Per violation.......           2,226
------------------------------------------------------------------------
\1\ The maximum penalty amount is per day, unless otherwise indicated.
\2\ The maximum penalty amount for a federal savings association is the
  lesser of this amount or 1 percent of total assets.
\3\ These amounts also apply to statutes that cross-reference 12 U.S.C.
  1818, such as 12 U.S.C. 2804, 3108, 3349, 4309, and 4717 and 15 U.S.C.
  1607, 1681s, 1691c, and 1692l.


    Dated: December 19, 2019.
Jonathan V. Gould,
Senior Deputy Comptroller and Chief Counsel, Office of the Comptroller 
of the Currency.
[FR Doc. 2019-28053 Filed 12-27-19; 8:45 am]
BILLING CODE 4810-33-P