[Federal Register Volume 87, Number 173 (Thursday, September 8, 2022)]
[Notices]
[Pages 55003-55005]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-19356]


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FEDERAL DEPOSIT INSURANCE CORPORATION

[OMB No. 3064-NEW]


Agency Information Collection Activities: Proposed Collection 
Renewal; Comment Request

AGENCY: Federal Deposit Insurance Corporation (FDIC).

ACTION: Notice and request for comment.

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SUMMARY: The FDIC, as part of its obligations under the Paperwork 
Reduction Act of 1995 (PRA), invites the general public and other 
Federal agencies to take this opportunity to comment on the new 
information collection described below.

DATES: Comments must be submitted on or before November 7, 2022.

ADDRESSES: Interested parties are invited to submit written comments to 
the FDIC by any of the following methods:
     Agency Website: https://www.fdic.gov/resources/regulations/federal-register-publications/.
     Email: [email protected]. Include the name and number of 
the collection in the subject line of the message.
     Mail: Manny Cabeza (202-898-3767), Regulatory Counsel, MB-
3128, Federal Deposit Insurance Corporation, 550 17th Street NW, 
Washington, DC 20429.
     Hand Delivery: Comments may be hand-delivered to the guard 
station at the rear of the 17th Street NW building (located on F Street 
NW), on business days between 7:00 a.m. and 5:00 p.m.
    All comments should refer to ``False Advertising, Misrepresentation 
of Insured Status, and Misuse of the FDIC's Name or Logo.'' A copy of 
the comments may also be submitted to the OMB desk officer for the 
FDIC: Office of Information and Regulatory Affairs, Office of 
Management and Budget, New Executive Office Building, Washington, DC 
20503.

FOR FURTHER INFORMATION, CONTACT: Manny Cabeza, Regulatory Counsel, 
202-898-3767, [email protected], MB-3128, Federal Deposit Insurance 
Corporation, 550 17th Street NW, Washington, DC 20429.

SUPPLEMENTARY INFORMATION: Proposal to establish a new collection of 
information:
    1. Title: False Advertising, Misrepresentation of Insured Status, 
and Misuse of the FDIC's Name or Logo.
    2. OMB Number: 3064-NEW
    Affected Public: Non-bank entities that make statements regarding 
the extent or manner of deposit insurance provided.
    Burden Estimate:

                                       Summary of Estimated Annual Burden
                                               [OMB No. 3064-NEW]
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                                 Type of burden                      Number of       Time per
    Information collection        (frequency of      Number of     responses per     response      Annual burden
    (obligation to respond)         response)       respondents     respondent        (HH:MM)         (hours)
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                                                 Implementation
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Insured Depository Institution  Disclosure                   500               1           02:00           1,000
 Relationships (12 CFR part      (Occasional).
 328.102(b)(5)) (Mandatory).    (Annual)........
                                                 ---------------------------------------------------------------
    Implementation Total......  ................  ..............  ..............  ..............           1,000
----------------------------------------------------------------------------------------------------------------
                                                     Ongoing
----------------------------------------------------------------------------------------------------------------
Insured Depository Institution  Disclosure                 1,500               1           00:30             750
 Relationships (12 CFR part      (Occasional).
 328.102(b)(5)) (Mandatory).    (Annual)........
                                                 ---------------------------------------------------------------
    Ongoing Total.............  ................  ..............  ..............             750
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Source: FDIC.

[[Page 55004]]

 
Note: Annual burden estimates for a given collection are calculated first by multiplying the number of
  respondents by the number of responses per respondent and rounded to the nearest whole number, which
  represents the total number of annual responses. This number is then multiplied by the time per response to
  obtain the estimated annual burden for that collection.

    General Description of Collection:
    The FDIC recently issued a final rule entitled ``False Advertising, 
Misrepresentation of Insured Status, and Misuse of the FDIC's Name or 
Logo'' (The Final Rule) \1\ that established the process by which the 
Federal Deposit Insurance Corporation (FDIC) will identify and 
investigate conduct that may violate section 18(a)(4) of the Federal 
Deposit Insurance Act, the standards under which such conduct will be 
evaluated, and the procedures which the Federal Deposit Insurance 
Corporation will follow when formally and informally enforcing the 
provisions of section 18(a)(4) of the Federal Deposit Insurance Act. 
The Final Rule amended FDIC regulations under 12 CFR part 328 (part 
328). In particular, certain amendments to part 328 impose disclosure 
requirements for non-bank entities that make certain types of 
statements regarding deposit insurance.\2\
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    \1\ 87 FR 33415 (June 2, 2022).
    \2\ 12 CFR 328.102(b)(5).
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    Section 18(a)(4) of the Federal Deposit Insurance Act (FDI Act), 12 
U.S.C. 1828(a)(4) (Section 18(a)(4)), prohibits any person from 
engaging in false advertising by misusing the name or logo of the FDIC 
or from making knowing misrepresentations about the existence of or the 
extent or manner of deposit insurance.\3\ Section 18(a)(4) provides the 
FDIC independent authority to investigate and take administrative 
enforcement actions, including the power to issue cease and desist 
orders and impose civil money penalties, against any person who misuses 
the FDIC name or logo or makes misrepresentations about deposit 
insurance. Part 328 sets out the FDIC's signage and advertising rules.
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    \3\ Under Federal law, it is also criminal offense to misuse the 
FDIC name or make false representations regarding deposit insurance. 
See 18 U.S.C. 709.
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    The Final Rule established a new subpart B to part 328, entitled 
``False Advertising, Misrepresentation of Insured Status, and Misuse of 
the FDIC's Name or Logo'' containing the new regulations. Section 
328.102 of subpart B sets forth the conduct that is prohibited by 
Section 18(a)(4). It further provides transparency by setting forth the 
FDIC's interpretation of the scope of prohibited conduct, including 
specific examples of conduct that the FDIC deems to violate Section 
18(a)(4). The section further sets forth certain standards that the 
FDIC will use to determine if a statement violates Section 18(a)(4). 
Section 328.102 establishes that a statement regarding deposit 
insurance will be deemed to omit material information if it does not 
identify the insured depository institution(s) with which the 
representing party has a direct or indirect business relationship for 
the placement of deposits and into which the consumer's deposits may be 
placed. Thereby, the Final Rule establishes third-party disclosure 
requirements for non-bank entities that make statements regarding the 
extent or manner of deposit insurance provided. These disclosure 
requirements constitute an information collection under the Paperwork 
Reduction Act (PRA) of 1995. As such, the FDIC is required to obtain 
OMB approval of this new information collection. The PRA burdens 
imposed by Sec.  328.102 can be categorized into two distinct burdens: 
(1) implementation burdens that are incurred once by each respondent to 
set up policies and procedures to ensure that its statements regarding 
deposit insurance comply with the requirements in Sec.  328.102; and 
(2) ongoing burdens that are incurred every year by each respondent to 
maintain compliance with these requirements. Since these burdens have 
separate frequencies and times per response, the FDIC is listing and 
estimating these two burdens separately.
    Potential respondents to this new information collection are non-
bank entities that make statements regarding the extent or manner of 
deposit insurance provided. The FDIC does not have direct data on the 
number of non-bank entities that would be affected by this requirement 
upon implementation. FDIC believes that the non-bank entities affected 
by the requirement would generally be classified in the following North 
American Industry Classification System (NAICS) industries: 
Miscellaneous Financial Investment Activities (NAICS Code 523999), 
Financial Transaction Processing, Reserve & Clearinghouse Activities 
(NAICS Code 522320), Computer System Design and Related Services (NAICS 
Code 5415), and Investment Advice (NAICS Code 523930). According to 
recent Census data, there were 144,556 firms in these NAICS industries 
in 2019, the most recent year for which such data is available.\4\ 
However, FDIC believes that the requirement will only affect 
approximately one percent of firms in these industries. Therefore, the 
FDIC estimates that approximately 1,500 non-bank entities will be 
affected by the third-party disclosure requirement.\5\
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    \4\ (1,110 + 3,163 + 120,070 + 20,213 = 144,556) 2019 County 
Business Patterns. See number of firms at https://www.census.gov/data/tables/2019/econ/susb/2019-susb-annual.html, last retrieved on 
June 30, 2022.
    \5\ 0.01 * 144,556 [ap] 1,500.
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    The 1,500 firms affected by this ICR are expected to implement 
policies and procedures to ensure that its statements regarding deposit 
insurance identify its partner insured depository institution(s), as 
described in Sec.  328.102, in the year in which the adopted regulation 
becomes effective. Annualized over a 3-year approval period, the 
average annual number of affected firms is 370. FDIC is conservatively 
assuming approximately 500 annual respondents to the implementation 
burden.
    In order to maintain compliance with the requirements of part 328, 
each of the 1,500 firms described above must regularly update its 
statements regarding deposit insurance to ensure that the statements 
continually identify the insured depository institution(s) described in 
Sec.  328.102. As such, FDIC estimates 1,500 annual respondents to the 
ongoing burden.
    The activities that respondents undergo to implement policies and 
procedures to comply with part 328 can all be considered part of a 
single response to the implementation requirement. Therefore, FDIC uses 
one as the number of annual responses per respondent for 
implementation. Similarly, activities throughout the year that are 
performed by respondents to maintain compliance with part 328 can all 
be considered as parts of a single annual response on an ongoing basis. 
FDIC uses one as the number of annual responses per respondent for the 
ongoing burden. Based on supervisory experience, FDIC estimates that 
the annual burden for each non-bank entities to disclose the Insured 
Depository Institution(s) with which the representing party has a 
direct or indirect business relationship for the placement of deposits 
and into which the consumer's deposits may be placed to be 2 hours per 
response for implementation and 0.5 hours per response on an ongoing 
basis.

[[Page 55005]]

Request for Comment

    Comments are invited on: (a) Whether the collections of information 
are necessary for the proper performance of the FDIC's functions, 
including whether the information has practical utility; (b) the 
accuracy of the estimates of the burden of the information collections, 
including the validity of the methodology and assumptions used; (c) 
ways to enhance the quality, utility, and clarity of the information to 
be collected; and (d) ways to minimize the burden of the collections of 
information on respondents, including through the use of automated 
collection techniques or other forms of information technology. All 
comments will become a matter of public record.


Federal Deposit Insurance Corporation.
    Dated at Washington, DC, on September 1, 2022.
James P. Sheesley,
Assistant Executive Secretary.
[FR Doc. 2022-19356 Filed 9-7-22; 8:45 am]
BILLING CODE 6714-01-P