[Federal Register Volume 86, Number 218 (Tuesday, November 16, 2021)]
[Notices]
[Pages 63387-63389]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-25012]


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FEDERAL TRADE COMMISSION


Agency Information Collection Activities; Proposed Collection; 
Comment Request

AGENCY: Federal Trade Commission (FTC or Commission).

ACTION: Notice.

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SUMMARY: The information collection requirements described below will 
be submitted to the Office of Management and Budget (OMB) for review, 
as required by the Paperwork Reduction Act (PRA). The FTC seeks public 
comments on the agency's shared enforcement with the Consumer Financial 
Protection Bureau (CFPB) of the information collection requirements in 
subpart N of the CFPB's Regulation V (Rule). That clearance expires on 
February 28, 2022.

DATES: Comments must be received on or before January 18, 2022.

ADDRESSES: Interested parties may file a comment online or on paper by 
following the instructions in the Request for Comments part of the 
SUPPLEMENTARY INFORMATION section below. Write ``Regulation V, subpart 
N; PRA Comment: FTC File No. P072108'' on your comment, and file your 
comment online at https://www.regulations.gov by following the 
instructions on the web-based form. If you prefer to file your comment 
on paper, mail your comment to the following address: Federal Trade 
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW, Suite 
CC-5610 (Annex J), Washington, DC 20580, or deliver your comment to the 
following address: Federal Trade Commission, Office of the Secretary, 
Constitution Center, 400 7th Street SW, 5th Floor, Suite 5610 (Annex 
J), Washington, DC 20024.

FOR FURTHER INFORMATION CONTACT: Requests for copies of the collection 
of information and supporting documentation should be addressed to Ryan 
Mehm, Attorney, Bureau of Consumer Protection, (202) 326-2918, Federal 
Trade Commission, 600 Pennsylvania Ave. NW, Washington, DC 20580.

SUPPLEMENTARY INFORMATION: Title: Regulation V, Subpart N (12 CFR 
1022.130-1022.138).
    OMB Control Number: 3084-0128.
    Type of Review: Extension of a currently approved collection.
    Abstract: The FTC shares enforcement authority with the CFPB for 
subpart N of Regulation V. Subpart N requires nationwide consumer 
reporting agencies and nationwide consumer specialty reporting agencies 
to provide to consumers, upon request, one free file disclosure within 
any 12-month period. Generally, it requires the nationwide consumer 
reporting agencies, as defined in Section 603(p) of the Fair Credit 
Reporting Act (FCRA), 15 U.S.C. 1681a(p), to create and operate a 
centralized source that provides consumers with the ability to request 
their free annual file disclosures from each of the nationwide consumer 
reporting agencies through a centralized internet website, toll-free 
telephone number, and postal address. Subpart N also requires the 
nationwide consumer reporting agencies to establish a standardized form 
for internet and mail requests for annual file disclosures and provides 
a model standardized form that may be used to comply with that 
requirement. It additionally requires nationwide specialty consumer 
reporting agencies, as defined in Section 603(w) of the FCRA, 15 U.S.C. 
1681a(w), to establish a streamlined process for consumers to request 
annual file disclosures. This streamlined process must include a toll-
free telephone number for consumers to make such requests.
    As required by section 3506(c)(2)(A) of the PRA, 44 U.S.C. 
3506(c)(2)(A), the FTC is providing this opportunity for public comment 
before requesting that OMB extend the existing clearance for the 
information collection requirements contained in the Rule.

Burden Statement

    Because the FTC shares enforcement authority with the CFPB for 
subpart N, the two agencies split between them the related estimate of 
PRA burden for firms under their co-enforcement jurisdiction. Estimated 
PRA burden, excluding the halving (to be shown at the conclusion of 
this analysis), are as follows:

A. Requests per Year From Consumers for Free Annual File Disclosures

    When the FTC last sought clearance renewal for the Rule, the 
Consumer Data Industry Association (``CDIA'') estimated that in 2016 
and 2017, the nationwide consumer reporting agencies provided on 
average approximately 25 million free annual file disclosures through 
the centralized internet website required to be established by the FACT 
Act and subpart N. Based on its knowledge of the industry, FTC staff 
projected that the consumer reporting agencies provided no more than 6 
million free annual file disclosures through the centralized toll-free 
telephone number and postal address required to be established by the 
FACT Act and subpart N. Accordingly, we estimated 31 million requests 
per year as a representative average to calculate PRA burden. We expect 
that the number of requests for free annual credit reports will rise 
over the next three years because of increases in the population and 
consumer awareness that they are entitled to a free annual report. As a 
proxy, we are now estimating 34 million requests per year as a 
representative average year to estimate PRA burden for purposes of the 
instant analysis.
    The Commission, however, seeks more recent estimates of the number 
of requests consumers are making for free annual credit reports. In 
addition to data on the number of requests, data on how the number of 
requests has changed over time, and how these requests are being 
received--by internet, phone, or by mail--would be most helpful.

B. Annual File Disclosures Provided Through the Internet

    Both nationwide and nationwide specialty consumer reporting 
agencies will likely handle the overwhelming majority of consumer 
requests through internet websites. The annual file disclosure requests 
processed through the internet will impose a de minimis hourly burden 
in personnel costs per request on the nationwide and nationwide 
specialty consumer reporting agencies, except for those requests that 
are redirected to the mail process.\1\ However, consumer reporting 
agencies periodically will be required to adjust the internet capacity 
needed to handle the changing request volume. Consumer reporting 
agencies likely will make such adjustments by negotiating or 
renegotiating outsourcing service contracts annually or as conditions

[[Page 63388]]

change. Trained personnel will need to spend time negotiating and 
renegotiating such contracts. Commission staff estimates that 
negotiating such contracts will require a cumulative total of 8,320 
hours and $646,963 in labor costs.\2\ Such activity is treated as an 
annual burden of maintaining and adjusting the changing internet 
capacity requirements.
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    \1\ See infra note 5.
    \2\ Based on the time necessary for similar activity in the 
federal government (including at the FTC), staff estimates that such 
contracting and administration will require approximately 4 full-
time equivalent employees (FTE) for the web service contracts. Thus, 
staff estimates that administering the contract will require four 
FTE, which is 8,320 hours per year (four FTE x 2,080 hours/year). 
The cost is based on the reported May 2020 Bureau of Labor 
Statistics (BLS) rate ($77.76) for computer and information systems 
managers. See Occupational Employment and Wages--May 2020, Table 1, 
available at https://www.bls.gov/news.release/pdf/ocwage.pdf. Thus, 
the estimated setup and maintenance cost for an internet system is 
$646,963 per year (8,320 hours x $77.76/hour).
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C. Annual File Disclosures Requested Over the Telephone

    Most of the telephone requests for annual file disclosures will 
also be handled in an automated fashion, with de minimis personnel 
costs needed to process the requests except for those requests that are 
redirected to the mail process.\3\ As with the internet, consumer 
reporting agencies will require additional time and investment to 
increase and administer the automated telephone capacity for the 
expected increase in request volume. The nationwide and nationwide 
specialty consumer reporting agencies will likely make such adjustments 
by negotiating or renegotiating outsourcing service contracts annually 
or as conditions change. Staff estimates that this will require a total 
of 6,240 hours at a cost of $485,222 in labor costs.\4\ This activity 
also is treated as an annual recurring burden necessary to obtain, 
maintain, and adjust automated call center capacity.
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    \3\ See infra note 5.
    \4\ Staff estimates that recurring contracting for automated 
telephone capacity will require approximately 3 FTE, a total of 
6,240 hours (3 x 2,080 hours). Applying an hourly wage rate of 
$77.76 (see supra note 2), estimated setup and maintenance cost is 
$485,222 (6,240 x $77.76) per year.
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D. Annual File Disclosures Requiring Processing by Mail

    Based on their knowledge of the industry, staff believes that no 
more than 1% of consumers (1% x 34 million, or 340,000) will request an 
annual file disclosure through U.S. postal service mail. Staff 
estimates that clerical personnel will require 10 minutes per request 
to handle these requests, thereby totaling 56,667 hours of time. 
[(340,000 x 10 minutes)/60 minutes per hour = 56,667 hours]
    In addition, whenever the requesting consumer cannot be identified 
using an automated method (a website or automated telephone service), 
it will be necessary to redirect that consumer to send identifying 
material along with the request by mail. Staff estimates that this will 
occur in about 5% of the new requests (or 1,683,000) \5\ that were 
originally placed over the internet or telephone. Staff estimates that 
clerical personnel will require approximately 10 minutes per request to 
input and process those redirected requests for a cumulative total of 
280,500 clerical hours. [(1,683,000 x 10 minutes)/60 minutes per hour = 
280,500 hours]
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    \5\ This figure reflects five percent of all requests, net of 
the estimated one percent of all requests that might initially be 
made by mail. That is, 0.05 x (34,000,000-340,000) = 1,683,000.
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E. Instructions to Consumers

    The Rule also requires that certain instructions be provided to 
consumers. See Rule sections 1022.136(b)(2)(iv)(A-B), 
1022.137(a)(2)(iii)(A-B). Minimal associated time or cost is involved, 
however. Internet instructions to consumers are embedded in the 
centralized source website and do not require additional time or cost 
for the nationwide consumer reporting agencies. Similarly, for 
telephone requests, the automated phone systems provide the requisite 
instructions when consumers select certain options. Some consumers who 
request their credit reports by mail might additionally request printed 
instructions from the nationwide and nationwide specialty consumer 
reporting agencies. Staff estimates that there will be a total of 
2,023,000 requests each year for free annual file disclosures by 
mail.\6\ Based on their knowledge of the industry, staff estimates 
that, of the predicted 2,023,000 mail requests, 10% (or 202,300) will 
request instructions by mail. If printed instructions are sent to each 
of these consumers by mail, requiring 10 minutes of clerical time per 
consumer, this will total 33,717 hours. [(202,300 instructions x 10 
minutes)/60 minutes per hour].
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    \6\ This figure includes both the estimated 1% of 34 million 
requests that will be made by mail each year (340,000), and the 
estimated 1,683,000 requests initially made over the internet or 
telephone that will be redirected to the mail process (see supra 
note 5).
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F. Labor Costs

    Labor costs are derived by applying hourly cost figures to the 
burden hours described above. Staff anticipates that processing of 
requests for annual file disclosures and instructions will be performed 
by clerical personnel and estimates that the processing will require 
370,884 hours at a cost of $7,013,416. [(56,667 hours for handling 
initial mail requests + 280,500 hours for handling requests redirected 
to mail + 33,717 hours for handling instructions mailed to consumers) x 
$18.91 per hour.\7\]
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    \7\ See Occupational Employment and Wages--May 2020, Table 1, 
available at https://www.bls.gov/news.release/pdf/ocwage.pdf (Office 
and administrative support workers, all others).
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    As elaborated on above, staff estimates that a total of 14,560 
labor hours will be needed to negotiate or renegotiate outsourced 
service contracts annually (or as conditions otherwise change) to 
increase internet (8,320 hours) and telephone (6,240 hours) capacity 
requirements for internet web services and the automated telephone call 
center. This will result in approximately $1,132,186 per year in labor 
costs. [14,560 hours x $77.76 per hour \8\]
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    \8\ See supra notes 2 and 4.
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    Thus, estimated cumulative labor costs are $8,145,602.

G. Capital/Non-Labor Costs

    As in the previous PRA clearance analysis, FTC staff believes it is 
likely that consumer reporting agencies will use third-party 
contractors (instead of their own employees) to increase the capacity 
of their systems. Because of the way these contracts are typically 
established, these costs will likely be incurred on a continuing basis 
and will be calculated based on the number of requests handled by the 
systems. Staff estimates that the total annual amount to be paid for 
services delivered under these contracts is $12,454,200.\9\
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    \9\ This consists of an estimated $8,323,200 for automated 
telephone cost ($1.36 per request x 6.12 million requests) and an 
estimated $4,131,000 ($0.15 per request x 27.54 million requests) 
for internet web service cost. Per unit cost estimates are based on 
staff's knowledge of the industry.
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H. Net Burden for FTC, After 50:50 Split

    After halving the updated estimates to split the PRA burden with 
the CFPB regarding the Rule, the FTC's burden totals are 192,722 hours, 
$4,072,801 in associated labor costs, and $6,227,100 in non-labor/
capital costs.
Request for Comments
    Pursuant to Section 3506(c)(2)(A) of the PRA, the FTC invites 
comments on: (1) Whether the proposed collection of information is 
necessary for the proper performance of the functions of the agency, 
including whether the information will have practical utility; (2) the 
accuracy of the agency's estimate

[[Page 63389]]

of the burden of the proposed collection of information, including the 
validity of the methodology and assumptions used; (3) ways to enhance 
the quality, utility, and clarity of the information to be collected; 
and (4) ways to minimize the burden of maintaining records and 
providing disclosures to consumers. All comments must be received on or 
before January 18, 2022.
    You can file a comment online or on paper. For the FTC to consider 
your comment, we must receive it on or before January 18, 2022. Write 
``Regulation V, subpart N; PRA Comment: FTC File No. P072108'' on your 
comment. Your comment--including your name and your state--will be 
placed on the public record of this proceeding, including the https://www.regulations.gov website.
    Due to the public health emergency in response to the COVID-19 
outbreak and the agency's heightened security screening, postal mail 
addressed to the Commission will be subject to delay. We encourage you 
to submit your comments online through the https://www.regulations.gov 
website.
    If you prefer to file your comment on paper, write ``Regulation V, 
subpart N; PRA Comment: FTC File No. P072108'' on your comment and on 
the envelope, and mail your comment to the following address: Federal 
Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue NW, 
Suite CC-5610 (Annex J), Washington, DC 20580; or deliver your comment 
to the following address: Federal Trade Commission, Office of the 
Secretary, Constitution Center, 400 7th Street SW, 5th Floor, Suite 
5610 (Annex J), Washington, DC 20024. If possible, submit your paper 
comment to the Commission by courier or overnight service.
    Because your comment will become publicly available at https://www.regulations.gov, you are solely responsible for making sure that 
your comment does not include any sensitive or confidential 
information. In particular, your comment should not include any 
sensitive personal information, such as your or anyone else's Social 
Security number; date of birth; driver's license number or other state 
identification number, or foreign country equivalent; passport number; 
financial account number; or credit or debit card number. You are also 
solely responsible for making sure that your comment does not include 
any sensitive health information, such as medical records or other 
individually identifiable health information. In addition, your comment 
should not include any ``trade secret or any commercial or financial 
information which . . . . is privileged or confidential'' --as provided 
by Section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 
4.10(a)(2), 16 CFR 4.10(a)(2) --including in particular competitively 
sensitive information such as costs, sales statistics, inventories, 
formulas, patterns, devices, manufacturing processes, or customer 
names.
    Comments containing material for which confidential treatment is 
requested must be filed in paper form, must be clearly labeled 
``Confidential,'' and must comply with FTC Rule 4.9(c). In particular, 
the written request for confidential treatment that accompanies the 
comment must include the factual and legal basis for the request and 
must identify the specific portions of the comment to be withheld from 
the public record. See FTC Rule 4.9(c). Your comment will be kept 
confidential only if the General Counsel grants your request in 
accordance with the law and the public interest. Once your comment has 
been posted publicly at www.regulations.gov, we cannot redact or remove 
your comment unless you submit a confidentiality request that meets the 
requirements for such treatment under FTC Rule 4.9(c), and the General 
Counsel grants that request.
    The FTC Act and other laws that the Commission administers permit 
the collection of public comments to consider and use in this 
proceeding, as appropriate. The Commission will consider all timely and 
responsive public comments that it receives on or before January 18, 
2022. For information on the Commission's privacy policy, including 
routine uses permitted by the Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.

Josephine Liu,
Assistant General Counsel for Legal Counsel.
[FR Doc. 2021-25012 Filed 11-15-21; 8:45 am]
BILLING CODE 6750-01-P