[Federal Register Volume 87, Number 15 (Monday, January 24, 2022)]
[Rules and Regulations]
[Pages 3433-3435]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-01284]


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DEPARTMENT OF THE TREASURY

Financial Crimes Enforcement Network

31 CFR Part 1010


Financial Crimes Enforcement Network; Inflation Adjustment of 
Civil Monetary Penalties

AGENCY: Financial Crimes Enforcement Network (FinCEN), Treasury.

ACTION: Final rule.

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SUMMARY: FinCEN is publishing this final rule to reflect inflation 
adjustments to its civil monetary penalties as mandated by the Federal 
Civil Penalties Inflation Adjustment Act of 1990, as amended. This rule 
adjusts certain maximum civil monetary penalties within the 
jurisdiction of FinCEN to the amounts required by that Act.

DATES: Effective January 24, 2022.

FOR FURTHER INFORMATION CONTACT: The FinCEN Regulatory Support Section 
at 1-800-767-2825, or electronically at [email protected].

SUPPLEMENTARY INFORMATION:

I. Background

    In order to improve the effectiveness of civil monetary penalties 
(CMPs) and to maintain their deterrent effect, the Federal Civil 
Penalties Inflation Adjustment Act of 1990, as amended in 2015 by 
section 701 of Public Law 114-74, codified at 28 U.S.C. 2461 note (the 
Act), requires Federal agencies to adjust for inflation each CMP 
provided by law within the jurisdiction of the agency. The Act requires 
agencies to adjust the level of CMPs with an initial ``catch-up'' 
adjustment through an interim final rulemaking. After the initial 
``catch-up''

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adjustment, agencies are required to adjust CMPs annually and to make 
the adjustments notwithstanding 5 U.S.C. 553, which requires notice-
and-comment rulemaking for certain agency actions. The Act provides 
that any increase in a CMP shall apply to CMPs that are assessed after 
the date the increase takes effect, regardless of whether the 
underlying violation predated such increase.\1\
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    \1\ The increased CMPs, however, apply only with respect to 
underlying violations occurring after November 2, 2015 the date of 
enactment of the most recent amendment to the Act.
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II. Method of Calculation

    The method of calculating CMP adjustments applied in this final 
rule is required by the Act. Under the Act and Office of Management and 
Budget (OMB) guidance, annual inflation adjustments subsequent to the 
initial catch-up adjustment are to be based on the percent change 
between the Consumer Price Index for all Urban Consumers (CPI-U) for 
the October preceding the date of the adjustment and the prior year's 
October CPI-U. As set forth in OMB Memorandum M-22-07 of December 15, 
2021, the adjustment multiplier for 2022 is 1.06222. In order to 
complete the 2022 annual adjustment, each current CMP (all of which 
were themselves last adjusted in 2021) is multiplied by the 2022 
adjustment multiplier. Under the Act, any increase in CMP must be 
rounded to the nearest multiple of $1.\2\
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    \2\ FinCEN has previously described that it applied a catch-up 
adjustment for each penalty subject to the Act, based on the year 
and corresponding amount(s) for which the maximum penalty or range 
of minimum and maximum penalties was established or last adjusted, 
whichever is later. See Civil Monetary Penalty Adjustment and Table, 
81 FR 42503, 42504 (June 30, 2016). Because the year varies for 
different penalties, penalties that were originally of the same size 
when promulgated can have different values today pursuant to the 
application of the Act.
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Procedural Matters

1. Administrative Procedure Act
    Section 4(b) of the Act requires agencies, beginning in 2017, to 
make annual adjustments for inflation to CMPs notwithstanding the 
notice and comment requirements of 5 U.S.C. 553. Additionally, the 
methodology used for adjusting CMPs for inflation, effective 2017, is 
provided by statute, with no discretion provided to agencies regarding 
the substance of the adjustments for inflation to CMPs. Accordingly, 
prior public notice and an opportunity for public comment and a delayed 
effective date are not required for this rule.
2. Regulatory Flexibility Act
    Because no notice of proposed rulemaking is required, the 
provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) do 
not apply.
3. Executive Order 12866.
    This rule is not a significant regulatory action as defined in 
section 3(f) of Executive Order 12866.
4. Paperwork Reduction Act
    The provisions of the Paperwork Reduction Act of 1995, Pub. L. 104-
13, 44 U.S.C. Chapter 35, and its implementing regulations, 5 CFR part 
1320, do not apply to this rule because there are no new or revised 
recordkeeping or reporting requirements.

List of Subjects in 31 CFR Part 1010

    Authority delegations (Government agencies), Administrative 
practice and procedure, Banks, banking, Brokers, Currency, Foreign 
banking, Foreign currencies, Gambling, Investigations, Penalties, 
Reporting and recordkeeping requirements, Securities, Terrorism.

Authority and Issuance

    For the reasons set forth in the preamble, part 1010 of chapter X 
of title 31 of the Code of Federal Regulations is amended as follows:

PART 1010--GENERAL PROVISIONS

0
1. The authority citation for part 1010 is revised to read as follows:

    Authority:  12 U.S.C. 1829b and 1951-1959; 31 U.S.C. 5311-5314 
and 5316-5336; title III, sec. 314, Pub. L. 107-56, 115 Stat. 307; 
sec. 2006, Pub. L. 114-41, 129 Stat. 458-459; sec. 701, Pub. L. 114-
74, 129 Stat. 599.


0
2. Amend Sec.  1010.821 by revising Table 1 of paragraph (b) to read as 
follows:


Sec.  1010.821   Penalty adjustment and table.

* * * * *
    (b) * * *

                              Table 1 of Sec.   1010.821--Penalty Adjustment Table
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                                                                                                Maximum penalty
                                                                                               amounts or range
                                                                                                of minimum and
                                               Civil monetary penalty      Penalties as last    maximum penalty
            U.S. Code citation                       description          amended by statute      amounts for
                                                                                              penalties assessed
                                                                                               on or after 1/24/
                                                                                                     2022
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12 U.S.C. 1829b(j)........................  Relating to Recordkeeping                $10,000             $23,011
                                             Violations For Funds
                                             Transfers.
12 U.S.C. 1955............................  Willful or Grossly Negligent              10,000              23,011
                                             Recordkeeping Violations.
31 U.S.C. 5318(k)(3)(C)...................  Failure to Terminate                      10,000              15,565
                                             Correspondent Relationship
                                             with Foreign Bank.
31 U.S.C. 5321(a)(1)......................  General Civil Penalty             25,000-100,000      62,689-250,759
                                             Provision for Willful
                                             Violations of Bank Secrecy
                                             Act Requirements.
31 U.S.C..................................  Foreign Financial Agency                  10,000              14,489
5321(a)(5)(B)(i)..........................   Transaction--Non-Willful
                                             Violation of Transaction.
31 U.S.C..................................  Foreign Financial Agency                 100,000             144,886
5321(a)(5)(C)(i)(I).......................   Transaction--Willful
                                             Violation of Transaction.
31 U.S.C..................................  Negligent Violation by                       500               1,253
5321(a)(6)(A).............................   Financial Institution or
                                             Non-Financial Trade or
                                             Business.
31 U.S.C..................................  Pattern of Negligent                      50,000              97,529
5321(a)(6)(B).............................   Activity by Financial
                                             Institution or Non-
                                             Financial Trade or Business.
31 U.S.C. 5321(a)(7)......................  Violation of Certain Due               1,000,000           1,556,481
                                             Diligence Requirements,
                                             Prohibition on
                                             Correspondent Accounts for
                                             Shell Banks, and Special
                                             Measures.

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31 U.S.C. 5330(e).........................  Civil Penalty for Failure to               5,000               9,250
                                             Register as Money
                                             Transmitting Business.
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Himamauli Das,
Acting Director, Financial Crimes Enforcement Network.
[FR Doc. 2022-01284 Filed 1-21-22; 8:45 am]
BILLING CODE 4810-02-P