[Title 31 CFR ]
[Code of Federal Regulations (annual edition) - July 1, 2005 Edition]
[From the U.S. Government Printing Office]



[[Page i]]



          31


          Parts 0 to 199

                         Revised as of July 1, 2005


          Money and Finance: Treasury
          
          


________________________

          Containing a codification of documents of general 
          applicability and future effect

          As of July 1, 2005
          With Ancillaries
                    Published by
                    Office of the Federal Register
                    National Archives and Records
                    Administration
                    A Special Edition of the Federal Register

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                            Table of Contents



                                                                    Page
  Explanation.................................................       v

  Title 31:
          Subtitle A--Office of the Secretary of the Treasury        3
    Subtitle B--Regulations Relating to Money and Finance
          Chapter I--Monetary Offices, Department of the 
          Treasury                                                 355
  Finding Aids:
      Material Approved for Incorporation by Reference........     493
      Table of CFR Titles and Chapters........................     495
      Alphabetical List of Agencies Appearing in the CFR......     513
      Redesignation Table.....................................     523
      List of CFR Sections Affected...........................     525

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                     ----------------------------

                     Cite this Code: CFR
                     To cite the regulations in 
                       this volume use title, 
                       part and section number. 
                       Thus, 31 CFR 0.101 refers 
                       to title 31, part 0, 
                       section 101.

                     ----------------------------

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                               EXPLANATION

    The Code of Federal Regulations is a codification of the general and 
permanent rules published in the Federal Register by the Executive 
departments and agencies of the Federal Government. The Code is divided 
into 50 titles which represent broad areas subject to Federal 
regulation. Each title is divided into chapters which usually bear the 
name of the issuing agency. Each chapter is further subdivided into 
parts covering specific regulatory areas.
    Each volume of the Code is revised at least once each calendar year 
and issued on a quarterly basis approximately as follows:

Title 1 through Title 16.................................as of January 1
Title 17 through Title 27..................................as of April 1
Title 28 through Title 41...................................as of July 1
Title 42 through Title 50................................as of October 1

    The appropriate revision date is printed on the cover of each 
volume.

LEGAL STATUS

    The contents of the Federal Register are required to be judicially 
noticed (44 U.S.C. 1507). The Code of Federal Regulations is prima facie 
evidence of the text of the original documents (44 U.S.C. 1510).

HOW TO USE THE CODE OF FEDERAL REGULATIONS

    The Code of Federal Regulations is kept up to date by the individual 
issues of the Federal Register. These two publications must be used 
together to determine the latest version of any given rule.
    To determine whether a Code volume has been amended since its 
revision date (in this case, July 1, 2005), consult the ``List of CFR 
Sections Affected (LSA),'' which is issued monthly, and the ``Cumulative 
List of Parts Affected,'' which appears in the Reader Aids section of 
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Register page number of the latest amendment of any given rule.

EFFECTIVE AND EXPIRATION DATES

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instances where the effective date is beyond the cut-off date for the 
Code a note has been inserted to reflect the future effective date. In 
those instances where a regulation published in the Federal Register 
states a date certain for expiration, an appropriate note will be 
inserted following the text.

OMB CONTROL NUMBERS

    The Paperwork Reduction Act of 1980 (Pub. L. 96-511) requires 
Federal agencies to display an OMB control number with their information 
collection request.

[[Page vi]]

Many agencies have begun publishing numerous OMB control numbers as 
amendments to existing regulations in the CFR. These OMB numbers are 
placed as close as possible to the applicable recordkeeping or reporting 
requirements.

OBSOLETE PROVISIONS

    Provisions that become obsolete before the revision date stated on 
the cover of each volume are not carried. Code users may find the text 
of provisions in effect on a given date in the past by using the 
appropriate numerical list of sections affected. For the period before 
January 1, 2001, consult either the List of CFR Sections Affected, 1949-
1963, 1964-1972, 1973-1985, or 1986-2000, published in 11 separate 
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INCORPORATION BY REFERENCE

    What is incorporation by reference? Incorporation by reference was 
established by statute and allows Federal agencies to meet the 
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to materials already published elsewhere. For an incorporation to be 
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This material, like any other properly issued regulation, has the force 
of law.
    What is a proper incorporation by reference? The Director of the 
Federal Register will approve an incorporation by reference only when 
the requirements of 1 CFR part 51 are met. Some of the elements on which 
approval is based are:
    (a) The incorporation will substantially reduce the volume of 
material published in the Federal Register.
    (b) The matter incorporated is in fact available to the extent 
necessary to afford fairness and uniformity in the administrative 
process.
    (c) The incorporating document is drafted and submitted for 
publication in accordance with 1 CFR part 51.
    Properly approved incorporations by reference in this volume are 
listed in the Finding Aids at the end of this volume.
    What if the material incorporated by reference cannot be found? If 
you have any problem locating or obtaining a copy of material listed in 
the Finding Aids of this volume as an approved incorporation by 
reference, please contact the agency that issued the regulation 
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the daily Federal Register.
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the revision dates of the 50 CFR titles.

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REPUBLICATION OF MATERIAL

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                              Raymond A. Mosley,
                                    Director,
                          Office of the Federal Register.

July 1, 2005.

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                               THIS TITLE

    Title 31--Money and Finance: Treasury is composed of three volumes. 
The parts in these volumes are arranged in the following order: parts 0-
199, parts 200-499, and parts 500 to end. The contents of these volumes 
represent all current regulations codified under this title of the CFR 
as of July 1, 2005.

    For this volume, Elmer Barksdale was Chief Editor. The Code of 
Federal Regulations publication program is under the direction of 
Frances D. McDonald, assisted by Alomha S. Morris.

[[Page 1]]



                  TITLE 31--MONEY AND FINANCE: TREASURY




                   (This book contains parts 0 to 199)

  --------------------------------------------------------------------
                                                                    Part

SUBTITLE A--Office of the Secretary of the Treasury.........           0

          SUBTITLE B--Regulations Relating to Money and Finance

chapter i--Monetary Offices, Department of the Treasury.....          56


Abbreviation Used in This Chapter:
    C. P. D.= Commissioner of the Public Debt.

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           Subtitle A--Office of the Secretary of the Treasury

  --------------------------------------------------------------------

Part                                                                Page
0               Department of the Treasury Employee Rules of 
                    Conduct.................................           5
1               Disclosure of records.......................          10
2               National security information...............          84
3               Claims regulations and indemnification of 
                    Department of Treasury employees........         111
4               Employees' personal property claims.........         114
5               Treasury debt collection....................         114
6               Applications for awards under the Equal 
                    Access to Justice Act...................         132
7               Employee inventions.........................         136
8               Practice before the Bureau of Alcohol, 
                    Tobacco and Firearms....................         137
9               Effects of imported articles on the national 
                    security................................         151
10              Practice before the Internal Revenue Service         154
11              Operation of vending facilities by the blind 
                    on Federal property under the control of 
                    the Department of the Treasury..........         187
12              Restriction of sale and distribution of 
                    tobacco products........................         189
13              Procedures for providing assistance to State 
                    and local governments in protecting 
                    foreign diplomatic missions.............         190
14              Right to Financial Privacy Act..............         194
15              Post employment conflict of interest........         196
16              Regulations implementing the Program Fraud 
                    Civil Remedies Act of 1986..............         202
17              Enforcement of nondiscrimination on the 
                    basis of handicap in programs or 
                    activities conducted by the Department 
                    of the Treasury.........................         218

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18              Officials designated to perform the 
                    functions and duties of certain offices 
                    in case of absence, disability, or 
                    vacancy.................................         224
19              Governmentwide debarment and suspension 
                    (nonprocurement)........................         225
20              Governmentwide requirements for drug-free 
                    workplace (financial assistance)........         247
21              New restrictions on lobbying................         253
25              Prepayment of foreign military sales loans 
                    made by the Defense Security Assistance 
                    Agency and foreign military sales loans 
                    made by the Federal Financing Bank and 
                    guaranteed by the Defense Security 
                    Assistance Agency.......................         264
26              Environmental Review of Actions by 
                    Multilateral Development Bands (MDBs)...         274
27              Civil penalty assessment for misuse of 
                    Department of the Treasury names, 
                    symbols, etc............................         277
28              Nondiscrimination on the basis of sex in 
                    education programs or activities 
                    receiving federal financial assistance..         281
29              Federal benefit payments under certain 
                    District of Columbia Programs...........         303
50              Terrorism Risk Insurance Program............         333

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PART 0_DEPARTMENT OF THE TREASURY EMPLOYEE RULES OF CONDUCT--Table of 
Contents




                      Subpart A_General Provisions

Sec.
0.101 Purpose.
0.102 Policy.
0.103 Definitions.

                            Responsibilities

0.104 Designated Agency Ethics Official and Alternate Designated Agency 
          Ethics Official.
0.105 Deputy Ethics Official.
0.106 Bureau Heads.
0.107 Employees.

                       Subpart B_Rules of Conduct

0.201 Political activity.
0.202 Strikes.
0.203 Gifts or gratuities from foreign governments.
0.204 Use of controlled substances and intoxicants.
0.205 Care of documents and data.
0.206 Disclosure of information.
0.207 Cooperation with official inquiries.
0.208 Falsification of official records.
0.209 Use of Government vehicles.
0.210 Conduct while on official duty or on Government property.
0.211 Soliciting, selling and canvassing.
0.212 Influencing legislation or petitioning Congress.
0.213 General conduct prejudicial to the Government.
0.214 Nondiscrimination.
0.215 Possession of weapons and explosives.
0.216 Privacy Act.
0.217 Personal financial interests.

                 Subpart C_Special Government Employees

0.301 Applicability of subpart B.
0.302 Service with other Federal agencies.

                  Subpart D_Advisers to the Department

0.401 Advisers to the Department.

    Authority: 5 U.S.C. 301.

    Source: 60 FR 28535, June 1, 1995, unless otherwise noted.



                      Subpart A_General Provisions



Sec. 0.101  Purpose.

    (a) The Department of the Treasury Employee Rules of Conduct (Rules) 
are separate from and additional to the Standards of Ethical Conduct for 
Employees of the Executive Branch (Executive Branch-wide Standards) (5 
CFR part 2635) and the Supplemental Standards of Ethical Conduct for 
Employees of the Department of the Treasury (Treasury Supplemental 
Standards) (to be codified at 5 CFR part 3101). The Rules prescribe 
employee rules of conduct and procedure and provide for disciplinary 
action for the violation of the Rules, the Treasury Supplemental 
Standards, the Executive Branch-wide Standards, and any other rule, 
regulation or law governing Department employees.
    (b) The Rules are not all-inclusive and may be modified by 
interpretive guidelines and procedures issued by the Department's 
bureaus. The absence of a specific published rule of conduct covering an 
action does not constitute a condonation of that action or indicate that 
the action would not result in corrective or disciplinary action.



Sec. 0.102  Policy.

    (a) All employees and officials of the Department are required to 
follow the rules of conduct and procedure contained in the Rules, the 
Treasury Supplemental Standards, the Executive Branch-wide Standards of 
Ethical Conduct, the Employee Responsibilities and Conduct (5 CFR part 
735), and any bureau issued rules.
    (b) Employees found in violation of the Rules, the Treasury 
Supplemental Standards, the Executive Branch-wide Standards or any 
applicable bureau rule may be instructed to take remedial or corrective 
action to eliminate the conflict. Remedial action may include, but is 
not limited to:
    (1) Reassignment of work duties;
    (2) Disqualification from a particular assignment;
    (3) Divestment of a conflicting interest; or
    (4) Other appropriate action.
    (c) Employees found in violation of the Rules, the Treasury 
Supplemental Standards, the Executive Branch-wide Standards or any 
applicable bureau rule may be disciplined in proportion to the gravity 
of the offense committed, including removal. Disciplinary action will be 
taken in accordance with applicable laws and regulations

[[Page 6]]

and after consideration of the employee's explanation and any mitigating 
factors. Further, disciplinary action may include any additional penalty 
prescribed by law.



Sec. 0.103  Definitions.

    The following definitions are used throughout this part:
    (a) Adviser means a person who provides advice to the Department as 
a representative of an outside group and is not an employee or special 
Government employee as those terms are defined in Sec. 0.103.
    (b) Bureau means:
    (1) Bureau of Alcohol, Tobacco and Firearms;
    (2) Bureau of Engraving and Printing;
    (3) Bureau of the Public Debt;
    (4) Departmental Offices;
    (5) Federal Law Enforcement Training Center;
    (6) Financial Management Service;
    (7) Internal Revenue Service;
    (8) Legal Division;
    (9) Office of the Comptroller of the Currency;
    (10) Office of the Inspector General;
    (11) Office of Thrift Supervision;
    (12) United States Customs Service;
    (13) United States Mint;
    (14) United States Secret Service; and
    (15) Any organization designated as a bureau by the Secretary 
pursuant to appropriate authority.
    (c) Person means an individual, corporation and subsidiaries it 
controls, company, association, firm, partnership, society, joint stock 
company, or any other organization or institution as specified in 5 CFR 
2635.102(k).
    (d) Regular employee or employee means an officer or employee of the 
Department of the Treasury but does not include a special Government 
employee.
    (e) Special Government employee means an officer or employee who is 
retained, designated, appointed, or employed to perform temporary duties 
either on a full-time or intermittent basis, with or without 
compensation, for a period not to exceed 130 days during any consecutive 
365-day period. See 18 U.S.C. 202(a).

                            Responsibilities



Sec. 0.104  Designated Agency Ethics Official and Alternate Designated 
Agency Ethics Official.

    The Deputy General Counsel is the Department's Designated Agency 
Ethics Official (DAEO). The DAEO is responsible for managing the 
Department's ethics program, including coordinating ethics counseling 
and interpreting questions of conflicts of interest and other matters 
that arise under the Executive Branch-wide Standards and Treasury 
Supplemental Standards and Rules. See 5 CFR 2638.203. The Senior Counsel 
for Ethics is the Alternate Designated Agency Ethics Official.



Sec. 0.105  Deputy Ethics Official.

    The Chief Counsel or Legal Counsel for a bureau, or a designee, is 
the Deputy Ethics Official for that bureau. The Legal Counsel for the 
Financial Crimes Enforcement Network is the Deputy Ethics Official for 
that organization. It is the responsibility of the Deputy Ethics 
Official to give authoritative advice and guidance on conflicts of 
interest and other matters arising under the Executive Branch-wide 
Standards, Treasury Supplemental Standards, and the Rules.



Sec. 0.106  Bureau Heads.

    Bureau heads or designees are required to:
    (a) Provide all employees with a copy of Executive Order 12674, as 
amended by Executive Order 12731, the Executive Branch-wide Standards, 
the Treasury Supplemental Standards and the Rules; provide all new 
employees with an explanation of the contents and application of the 
Executive Branch-wide Standards, Treasury Supplemental Standards and the 
Rules; and provide all departing employees with an explanation of the 
applicable post-employment restrictions contained in 18 U.S.C. 207 and 5 
CFR part 2641 and any other applicable law or regulation.
    (b) Provide guidance and assistance to supervisors and employees in 
implementing and adhering to the rules and procedures included in the 
Executive Branch-wide Standards and Treasury

[[Page 7]]

Supplemental Standards and Rules; obtain any necessary legal advice or 
interpretation from the Designated Agency Ethics Official or a Deputy 
Ethics Official; and inform employees as to how and from whom they may 
obtain additional clarification or interpretation of the Executive 
Branch-wide Standards, Treasury Supplemental Standards, Rules, and any 
other relevant law, rule or regulation.
    (c) Take appropriate corrective or disciplinary action against an 
employee who violates the Executive Branch-wide Standards, Treasury 
Supplemental Standards or Rules, or any other applicable law, rule or 
regulation, and against a supervisor who fails to carry out his 
responsibilities in taking or recommending corrective or disciplinary 
action when appropriate against an employee who has committed an 
offense.



Sec. 0.107  Employees.

    (a) Employees are required to:
    (1) Read and follow the rules and procedures contained in the 
Executive Branch-wide Standards, Treasury Supplemental Standards, and 
Rules;
    (2) Request clarification or interpretation from a supervisor or 
ethics official if the application of a rule contained in the Executive 
Branch-wide Standards, Treasury Supplemental Standards, or Rules is not 
clear;
    (3) Report to the Inspector General or to the appropriate internal 
affairs office of the Bureau of Alcohol, Tobacco and Firearms, Customs 
Service, Internal Revenue Service, or Secret Service, any information 
indicating that an employee, former employee, contractor, subcontractor, 
or potential contractor engaged in criminal conduct or that an employee 
or former employee violated the Executive Branch-wide Standards or the 
Treasury Supplemental Standards or Rules. Legal Division attorneys 
acquiring this type of information during the representation of a bureau 
shall report it to the appropriate Chief or Legal Counsel or the Deputy 
General Counsel, who shall report such information to the Inspector 
General or appropriate internal affairs office; and
    (4) Report to the Inspector General information defined in paragraph 
(a)(3) of this section relating to foreign intelligence or national 
security, as covered in Executive Order 12356. Legal Division attorneys 
acquiring this type of information during the representation of a bureau 
shall report it to the Deputy General Counsel, who shall report such 
information to the Inspector General.
    (b) The confidentiality of the source of the information reported to 
the Inspector General or the internal affairs office under this section 
will be maintained to the extent appropriate under the circumstances.



                       Subpart B_Rules of Conduct



Sec. 0.201  Political activity.

    (a) Employees may:
    (1) Take an active part in political management or in political 
campaigns to the extent permitted by law (5 U.S.C. 7321-7326); and
    (2) Vote as they choose and express their opinions on political 
subjects and candidates.
    (b) Employees may not use their official authority or influence to 
interfere with or affect election results.
    (c) Employees may be disqualified from employment for knowingly 
supporting or advocating the violent overthrow of our constitutional 
form of government.
    Note: The Hatch Act Reform Amendments of 1993 significantly reduced 
the statutory restrictions on the political activity of most Department 
employees. However, career members of the Senior Executive Service and 
employees of the Secret Service, the Internal Revenue Service, Office of 
Criminal Investigation, the Customs Service, Office of Investigative 
Programs, and the Bureau of Alcohol, Tobacco and Firearms, Office of Law 
Enforcement, remain subject to significant restrictions on their 
political activities.



Sec. 0.202  Strikes.

    Employees shall not strike against the Government.



Sec. 0.203  Gifts or gratuities from foreign governments.

    (a) The United States Constitution prohibits employees from 
accepting gifts, emoluments, offices, or titles from a foreign 
government without the consent of the Congress. Congress has consented 
to an employee accepting

[[Page 8]]

and retaining a gift from a foreign government that is of minimal value 
and offered as a souvenir or mark of courtesy, unless otherwise 
prohibited by bureau regulation (5 U.S.C. 7342). Minimal value is 
prescribed in 41 CFR part 101-49 and was set at $225.00 on the date that 
the Rules became effective.
    (b) All gifts exceeding minimal value, the refusal of which would 
likely cause offense or embarrassment or otherwise adversely affect the 
foreign relations of the United States, shall be accepted and deposited 
with the Department within sixty days of acceptance. If the gift is 
travel or expenses for travel taking place entirely outside the United 
States, it shall be reported within thirty days (see 5 U.S.C. 
7342(c)(1)(B)(ii)).
    (c) As used in paragraph (b) of this section, Deposit with the 
Department means delivery to the Department Gift Unit or other 
depository as authorized by the Treasury Directive on Foreign Gifts 
(Treasury Directive 61-04).
    (d) All foreign gifts must be reported as prescribed in the Treasury 
Directive on Foreign Gifts (Treasury Directive 61-04).



Sec. 0.204  Use of controlled substances and intoxicants.

    Employees shall not sell, use or possess controlled substances or 
intoxicants in violation of the law while on Department property or 
official duty, or use a controlled substance or intoxicant in a manner 
that adversely affects their work performance.



Sec. 0.205  Care of documents and data.

    (a) Employees shall not conceal, remove, alter, destroy, mutilate or 
access documents or data in the custody of the Federal Government 
without proper authority.
    (b) Employees are required to care for documents according to 
Federal law and regulation, and Department procedure (18 U.S.C. 2071, 5 
U.S.C. 552, 552a).
    (c) The term documents includes, but is not limited to, any writing, 
recording, computer tape or disk, blueprint, photograph, or other 
physical object on which information is recorded.



Sec. 0.206  Disclosure of information.

    Employees shall not disclose official information without proper 
authority, pursuant to Department or bureau regulation. Employees 
authorized to make disclosures should respond promptly and courteously 
to requests from the public for information when permitted to do so by 
law (31 CFR 1.9, 1.10, and 1.28(b)).



Sec. 0.207  Cooperation with official inquiries.

    Employees shall respond to questions truthfully and under oath when 
required, whether orally or in writing, and must provide documents and 
other materials concerning matters of official interest when directed to 
do so by competent Treasury authority.



Sec. 0.208  Falsification of official records.

    Employees shall not intentionally make false, misleading or 
ambiguous statements, orally or in writing, in connection with any 
matter of official interest. Matters of official interest include among 
other things: Transactions with the public, government agencies or 
fellow employees; application forms and other forms that serve as a 
basis for appointment, reassignment, promotion or other personnel 
action; vouchers; leave records and time and attendance records; work 
reports of any nature or accounts of any kind; affidavits; entry or 
record of any matter relating to or connected with an employee's duties; 
and reports of any moneys or securities received, held or paid to, for 
or on behalf of the United States.



Sec. 0.209  Use of Government vehicles.

    Employees shall not use Government vehicles for unofficial purposes, 
including to transport unauthorized passengers. The use of Government 
vehicles for transporting employees between their domiciles and places 
of employment must be authorized by statute (See, e.g., 31 U.S.C. 1344).



Sec. 0.210  Conduct while on official duty or on Government property.

    Employees must adhere to the regulations controlling conduct when 
they are on official duty or in or on Government property, including the 
Treasury Building, Treasury Annex Building and grounds; the Bureau of 
Engraving and Printing buildings and grounds; the

[[Page 9]]

United States Mint buildings and grounds; the grounds of the Federal Law 
Enforcement Training Center; and Treasury-occupied General Services 
Administration buildings and grounds (see 31 CFR parts 91, 407, 605, 
700).



Sec. 0.211  Soliciting, selling and canvassing.

    Employees shall not solicit, make collections, canvass for the sale 
of any article, or distribute literature or advertising in any space 
occupied by the Department without appropriate authority.



Sec. 0.212  Influencing legislation or petitioning Congress.

    (a) Employees shall not use Government time, money, or property to 
petition a Member of Congress to favor or oppose any legislation. This 
prohibition does not apply to the official handling, through the proper 
channels, of matters relating to legislation in which the Department of 
the Treasury has an interest.
    (b) Employees, individually or collectively, may petition Congress 
or Members of Congress or furnish information to either House of 
Congress when not using Government time, money or property (5 U.S.C. 
7211).



Sec. 0.213  General conduct prejudicial to the Government.

    Employees shall not engage in criminal, infamous, dishonest, or 
notoriously disgraceful conduct, or any other conduct prejudicial to the 
Government.



Sec. 0.214  Nondiscrimination.

    (a) Employees shall not discriminate against or harass any other 
employee, applicant for employment or person dealing with the Department 
on official business on the basis of race, color, religion, national 
origin, sex, sexual orientation, age, or disability. Sexual harassment 
is a form of sex discrimination and is prohibited by this section.
    (b) An employee who engages in discriminatory conduct may be 
disciplined under these rules. However, this section does not create any 
enforceable legal rights in any person.



Sec. 0.215  Possession of weapons and explosives.

    (a) Employees shall not possess firearms, explosives, or other 
dangerous or deadly weapons, either openly or concealed, while on 
Government property or official duty.
    (b) The prohibition in paragraph (a) of this section does not apply 
to employees who are required to possess weapons or explosives in the 
performance of their official duties.



Sec. 0.216  Privacy Act.

    Employees involved in the design, development, operation, or 
maintenance of any system of records or in maintaining records subject 
to the Privacy Act of 1974, as amended (5 U.S.C. 552a), shall comply 
with the conduct regulations delineated in 31 CFR 1.28(b).



Sec. 0.217  Personal financial interests.

    (a) Employees may hold the following financial interests without 
violating 18 U.S.C. 208(a):
    (1) The stocks or bonds of a publicly traded corporation with a 
value of $1000 or less; and
    (2) The stocks or bonds in the investment portfolio of a diversified 
mutual fund in which an employee has invested.
    (b) The Department has found that the financial interests listed in 
paragraph (a) of this section are too remote and inconsequential to 
affect the integrity of an employee's service.



                 Subpart C_Special Government Employees



Sec. 0.301  Applicability of subpart B.

    The rules of conduct contained in subpart B of this part apply to 
special Government employees employed with the Treasury Department. The 
regulations contained in Sec. 0.201 of subpart B, concerning political 
activity, apply to special Government employees only on the days that 
they serve the Department. Treasury bureaus are responsible for 
informing special Government employees employed with them of the 
applicability of bureau specific statutes or regulations.

[[Page 10]]



Sec. 0.302  Service with other Federal agencies.

    A special Government employee serving concurrently in the Department 
and in a Federal agency other than the Department is required to inform 
the Department and the agency in which he serves of the arrangement so 
that appropriate administrative measures may be taken.



                  Subpart D_Advisers to the Department



Sec. 0.401  Advisers to the Department.

    (a) An adviser or advisory committee member includes an individual 
who provides advice to the Department as a representative of an outside 
group and is not an employee or special Government employee of the 
Department. Questions concerning whether an individual serves the 
Department in the capacity of an adviser, employee, or special 
Government employee shall be addressed to the Designated Agency Ethics 
Official or a Deputy Ethics Official.
    (b) Advisers or advisory committee members are not required to 
follow the Rules and are not generally required by the Department to 
file financial disclosure statements; nevertheless, they should be 
guided by the regulations in this part covering such issues as public 
disclosure of official information (Sec. 0.206), conduct (Sec. 0.211 
and Sec. 0.213), and gifts or gratuities from Foreign governments 
(Sec. 0.203).



PART 1_DISCLOSURE OF RECORDS--Table of Contents




                  Subpart A_Freedom of Information Act

Sec.
1.1 General.
1.2 Information made available.
1.3 Publication in the Federal Register.
1.4 Public inspection and copying.
1.5 Specific requests for other records.
1.6 Business information.
1.7 Fees for services.

Appendix A to Subpart A--Departmental Offices
Appendix B to Subpart A--Internal Revenue Service
Appendix C to Subpart A--United States Customs Service
Appendix D to Subpart A--United States Secret Service
Appendix E to Subpart A--Bureau of Alcohol, Tobacco and Firearms
Appendix F to Subpart A--Bureau of Engraving and Printing
Appendix G to Subpart A--Financial Management Service
Appendix H to Subpart A--United States Mint
Appendix I to Subpart A--Bureau of the Public Debt
Appendix J to Subpart A--Office of the Comptroller of the Currency
Appendix K to Subpart A--Federal Law Enforcement Training Center
Appendix L to Subpart A--Office of Thrift Supervision
Appendix M to Subpart A--Financial Crimes Enforcement Network

                  Subpart B_Other Disclosure Provisions

1.8 Scope.
1.9 Records not to be otherwise withdrawn or disclosed.
1.10 Oral information.
1.11 Testimony or the production of records in a court or other 
          proceeding.
1.12 Regulations not applicable to official request.

                          Subpart C_Privacy Act

1.20 Purpose and scope of regulations.
1.21 Definitions.
1.22 Requirements relating to systems of records.
1.23 Publication in the Federal Register--Notices of systems of records, 
          general exemptions, specific exemptions, review of all 
          systems.
1.24 Disclosure of records to person other than the individual to whom 
          they pertain.
1.25 Accounting of disclosures.
1.26 Procedures for notification and access to records pertaining to 
          individuals--format and fees for request for access.
1.27 Procedures for amendment of records pertaining to individuals--
          format, agency review and appeal from initial adverse agency 
          determination.
1.28 Training, rules of conduct, penalties for non-compliance.
1.29 Records transferred to Federal Records Center or National Archives 
          of the United States.
1.30 Application to system of records maintained by Government 
          contractors.
1.31 Sale or rental of mailing lists.
1.32 Use and disclosure of social security numbers.
1.34 Guardianship.
1.35 Information forms.
1.36 Systems exempt in whole or in part from provisions of 5 U.S.C. 552a 
          and this part.

[[Page 11]]


Appendix A to Subpart C--Departmental Offices
Appendix B to Subpart C--Internal Revenue Service
Appendix C to Subpart C--United States Customs Service
Appendix D to Subpart C--United States Secret Service
Appendix E to Subpart C--Bureau of Alcohol, Tobacco and Firearms
Appendix F to Subpart C--Bureau of Engraving and Printing
Appendix G to Subpart C--Financial Management Service
Appendix H to Subpart C--United States Mint
Appendix I to Subpart C--Bureau of the Public Debt
Appendix J to Subpart C--Office of the Comptroller of the Currency
Appendix K to Subpart C--Federal Law Enforcement Training Center
Appendix L to Subpart C--Office of Thrift Supervision
Appendix M to Subpart C [Reserved]
Appendix N to Subpart C--Financial Crimes Network

    Authority: 5 U.S.C. 301 and 31 U.S.C. 321. Subpart A also issued 
under 5 U.S.C. 552, as amended. Subpart C also issued under 5 U.S.C. 
552a.

    Source: 52 FR 26305, July 14, 1987, unless otherwise noted.



                  Subpart A_Freedom of Information Act

    Source: 65 FR 40504, June 30, 2000, unless otherwise noted.



Sec. 1.1  General.

    (a) Purpose and scope. (1) This subpart contains the regulations of 
the Department of the Treasury implementing the Freedom of Information 
Act (FOIA), 5 U.S.C. 552, as amended by the Electronic Freedom of 
Information Act Amendments of 1996. The regulations set forth procedures 
for requesting access to records maintained by the Department of the 
Treasury. These regulations apply to all bureaus of the Department of 
the Treasury. Any reference in this subpart to the Department or its 
officials, employees, or records shall be deemed to refer also to the 
bureaus or their officials, employees, or records. Persons interested in 
the records of a particular bureau should also consult the appendix to 
this subpart that pertains to that bureau. The head of each bureau is 
hereby authorized to substitute the officials designated and change the 
addresses specified in the appendix to this subpart applicable to the 
bureau. The bureaus of the Department of the Treasury for the purposes 
of this subpart are:
    (i) The Departmental Offices, which include the offices of:
    (A) The Secretary of the Treasury, including immediate staff;
    (B) The Deputy Secretary of the Treasury, including immediate staff;
    (C) The Chief of Staff, including immediate staff;
    (D) The Executive Secretary and all offices reporting to such 
official, including immediate staff;
    (E) The Under Secretary of the Treasury for International Affairs 
and all offices reporting to such official, including immediate staff;
    (F) The Under Secretary of the Treasury for Domestic Finance and all 
offices reporting to such official, including immediate staff;
    (G) The Under Secretary for Enforcement and all offices reporting to 
such official, including immediate staff;
    (H) The Assistant Secretary of the Treasury for Financial 
Institutions and all offices reporting to such official, including 
immediate staff;
    (I) The Assistant Secretary of the Treasury for Economic Policy and 
all offices reporting to such official, including immediate staff;
    (J) The Fiscal Assistant Secretary and all offices reporting to such 
official, including immediate staff;
    (K) The General Counsel and all offices reporting to such official, 
including immediate staff; except legal counsel to the components listed 
in paragraphs (a)(1)(i)(L), and (a)(1)(i)(S), and (a)(1)(ii) through 
(xiii) of this section;
    (L) The Inspector General and all offices reporting to such 
official, including immediate staff;
    (M) The Assistant Secretary of the Treasury for International 
Affairs and all offices reporting to such official, including immediate 
staff;
    (N) The Assistant Secretary of the Treasury for Legislative Affairs 
and Public Liaison and all offices reporting to such official, including 
immediate staff;

[[Page 12]]

    (O) The Assistant Secretary of the Treasury for Management and Chief 
Financial Officer and all offices reporting to such official, including 
immediate staff;
    (P) The Assistant Secretary of the Treasury for Public Affairs and 
all offices reporting to such official, including immediate staff;
    (Q) The Assistant Secretary of the Treasury for Tax Policy and all 
offices reporting to such official, including immediate staff;
    (R) The Treasurer of the United States, including immediate staff;
    (S) The Treasury Inspector General for Tax Administration and all 
offices reporting to such official, including immediate staff.
    (ii) The Bureau of Alcohol, Tobacco and Firearms.
    (iii) The Office of the Comptroller of the Currency.
    (iv) The United States Customs Service.
    (v) The Bureau of Engraving and Printing.
    (vi) The Federal Law Enforcement Training Center.
    (vii) The Financial Management Service.
    (viii) The Internal Revenue Service.
    (ix) The United States Mint.
    (x) The Bureau of the Public Debt.
    (xi) The United States Secret Service.
    (xii) The Office of Thrift Supervision.
    (xiii) The Financial Crimes Enforcement Network.
    (2) For purposes of this subpart, the office of the legal counsel 
for the components listed in paragraphs (a)(1)(ii) through (xiii) of 
this section are to be considered a part of their respective bureaus. 
Any office which is now in existence or may hereafter be established, 
which is not specifically listed or known to be a component of any of 
those listed in paragraphs (a)(1)(i) through (xiii) of this section, 
shall be deemed a part of the Departmental Offices for the purpose of 
making requests for records under this subpart.
    (b) Definitions. As used in this subpart, the following terms shall 
have the following meanings:
    (1) Agency has the meaning given in 5 U.S.C. 551(1) and 5 U.S.C. 
552(f).
    (2) Appeal means a request for a review of an agency's determination 
with regard to a fee waiver, category of requester, expedited 
processing, or denial in whole or in part of a request for access to a 
record or records.
    (3) Bureau means an entity of the Department of the Treasury that is 
authorized to act independently in disclosure matters.
    (4) Business information means trade secrets or other commercial or 
financial information.
    (5) Business submitter means any entity which provides business 
information to the Department of the Treasury or its bureaus and which 
has a proprietary interest in the information.
    (6) Computer software means tools by which records are created, 
stored, and retrieved. Normally, computer software, including source 
code, object code, and listings of source and object codes, regardless 
of medium, are not agency records. However, when data are embedded 
within the software and cannot be extracted without the software, the 
software may have to be treated as an agency record. Proprietary (or 
copyrighted) software is not an agency record.
    (7) Confidential commercial information means records provided to 
the government by a submitter that arguably contain material exempt from 
release under Exemption 4 of the Freedom of Information Act, 5 U.S.C. 
552(b)(4), because disclosure could reasonably be expected to cause 
substantial competitive harm.
    (8) Duplication refers to the process of making a copy of a record 
in order to respond to a FOIA request. Such copies can take the form of 
paper copy, microform, audio-visual materials, or machine readable 
documentation (e.g., magnetic tape or disk), among others.
    (9) Electronic records means those records and information which are 
created, stored, and retrievable by electronic means. This ordinarily 
does not include computer software, which is a tool by which to create, 
store, or retrieve electronic records.
    (10) Request means any request for records made pursuant to 5 U.S.C. 
552(a)(3).
    (11) Requester means any person who makes a request for access to 
records.

[[Page 13]]

    (12) Responsible official means a disclosure officer or the head of 
the organizational unit having immediate custody of the records 
requested, or an official designated by the head of the organizational 
unit.
    (13) Review, for fee purposes, refers to the process of examining 
records located in response to a commercial use request to determine 
whether any portion of any record located is permitted to be withheld. 
It also includes processing any records for disclosure; e.g., doing all 
that is necessary to excise them and otherwise prepare them for release.
    (14) Search includes all time spent looking for material that is 
responsive to a request, including page-by-page or line-by-line 
identification of material within records. Searches may be done manually 
or by automated means.

[65 FR 40504, June 30, 2000, as amended at 68 FR 55311, Sept. 25, 2003]



Sec. 1.2  Information made available.

    (a) General. The FOIA (5 U.S.C. 552) provides for access to 
information and records developed or maintained by Federal agencies. The 
provisions of section 552 are intended to assure the right of the public 
to information. Generally, this section divides agency information into 
three major categories and provides methods by which each category of 
information is to be made available to the public. The three major 
categories of information are as follows:
    (1) Information required to be published in the Federal Register 
(see Sec. 1.3);
    (2) Information required to be made available for public inspection 
and copying or, in the alternative, to be published and offered for sale 
(see Sec. 1.4); and
    (3) Information required to be made available to any member of the 
public upon specific request (see Sec. 1.5).
    (b) Subject only to the exemptions and exclusions set forth in 5 
U.S.C. 552(b) and (c), any person shall be afforded access to 
information or records in the possession of any bureau of the Department 
of the Treasury, subject to the regulations in this subpart and any 
regulations of a bureau implementing or supplementing them.
    (c) Exemptions. (1) The disclosure requirements of 5 U.S.C. 552(a) 
do not apply to certain matters which are exempt under 5 U.S.C. 552(b); 
nor do the disclosure requirements apply to certain matters which are 
excluded under 5 U.S.C. 552(c).
    (2) Even though an exemption described in 5 U.S.C. 552(b) may be 
applicable to the information or records requested, a Treasury bureau 
may, if not precluded by law, elect under the circumstances of that 
request not to apply the exemption. The fact that the exemption is not 
applied by a bureau in response to a particular request shall have no 
precedential significance in processing other requests, but is merely an 
indication that, in the processing of the particular request, the bureau 
finds no necessity for applying the exemption.



Sec. 1.3  Publication in the Federal Register.

    (a) Requirement. Subject to the application of the exemptions and 
exclusions in 5 U.S.C. 552(b) and (c) and subject to the limitations 
provided in 5 U.S.C. 552(a)(1), each Treasury bureau shall, in 
conformance with 5 U.S.C. 552(a)(1), separately state, publish and 
maintain current in the Federal Register for the guidance of the public 
the following information with respect to that bureau:
    (1) Descriptions of its central and field organization and the 
established places at which, the persons from whom, and the methods 
whereby, the public may obtain information, make submittals or requests, 
or obtain decisions;
    (2) Statements of the general course and method by which its 
functions are channeled and determined, including the nature and 
requirements of all formal and informal procedures available;
    (3) Rules of procedure, descriptions of forms available or the 
places at which forms may be obtained, and instructions as to the scope 
and contents of all papers, reports, or examinations;
    (4) Substantive rules of general applicability adopted as authorized 
by law, and statements of general policy or interpretations of general 
applicability formulated and adopted by the bureau; and

[[Page 14]]

    (5) Each amendment, revision, or repeal of matters referred to in 
paragraphs (a)(1) through (4) of this section.
    (b) The United States Government Manual. The functions of each 
bureau are summarized in the description of the Department and its 
bureaus in the United States Government Manual, which is issued annually 
by the Office of the Federal Register.



Sec. 1.4  Public inspection and copying.

    (a) In general. Subject to the application of the exemptions and 
exclusions described in 5 U.S.C. 552(b) and (c), each Treasury bureau 
shall, in conformance with 5 U.S.C. 552(a)(2), make available for public 
inspection and copying, or, in the alternative, promptly publish and 
offer for sale the following information with respect to the bureau:
    (1) Final opinions, including concurring and dissenting opinions, 
and orders, made in the adjudication of cases;
    (2) Those statements of policy and interpretations which have been 
adopted by the bureau but are not published in the Federal Register;
    (3) Its administrative staff manuals and instructions to staff that 
affect a member of the public;
    (4) Copies of all records, regardless of form or format, which have 
been released to any person under 5 U.S.C. 552(a)(3), and which the 
bureau determines have become or are likely to become the subject of 
subsequent requests for substantially the same records because they are 
clearly of interest to the public at large. The determination that 
records have become or may become the subject of subsequent requests 
shall be made by the Responsible Official (as defined at Sec. 
1.1(b)(12)).
    (5) A general index of the records referred to in paragraph (a)(4) 
of this section.
    (b) Information made available by computer telecommunications. For 
records required to be made available for public inspection and copying 
pursuant to 5 U.S.C. 552(a)(2) (paragraphs (a)(1) through (4) of this 
section) which are created on or after November 1, 1996, as soon as 
practicable but no later than one year after such records are created, 
each bureau shall make such records available on the Internet.
    (c) Deletion of identifying details. To prevent a clearly 
unwarranted invasion of personal privacy, or pursuant to an exemption in 
5 U.S.C. 552(b), a Treasury bureau may delete information contained in 
any matter described in paragraphs (a)(1) through (4) of this section 
before making such matters available for inspection or publishing it. 
The justification for the deletion shall be explained fully in writing, 
and the extent of such deletion shall be indicated on the portion of the 
record which is made available or published, unless including that 
indication would harm an interest protected by the exemption in 5 U.S.C. 
552(b) under which the deletion is made. If technically feasible, the 
extent of the deletion shall be indicated at the place in the record 
where the deletion was made.
    (d) Public reading rooms. Each bureau of the Department of the 
Treasury shall make available for public inspection and copying, in a 
reading room or otherwise, the material described in paragraphs (a)(1) 
through (5) of this section. Fees for duplication shall be charged in 
accordance with Sec. 1.7. See the appendices to this subpart for the 
location of established bureau reading rooms.
    (e) Indexes. (1) Each bureau of the Department of the Treasury shall 
maintain and make available for public inspection and copying current 
indexes identifying any material described in paragraphs (a)(1) through 
(3) of this section. In addition, each bureau shall promptly publish, 
quarterly or more frequently, and distribute (by sale or otherwise) 
copies of each index or supplement unless the head of each bureau (or a 
delegate) determines by order published in the Federal Register that the 
publication would be unnecessary and impractical, in which case the 
bureau shall nonetheless provide copies of the index on request at a 
cost not to exceed the direct cost of duplication.
    (2) Each bureau shall make the index referred to in paragraph (a)(5) 
of this section available on the Internet by December 31, 1999.



Sec. 1.5  Specific requests for other records.

    (a) In general. (1) Except for records made available under 5 U.S.C. 
552(a)(1)

[[Page 15]]

and (a)(2), but subject to the application of the exemptions and 
exclusions described in 5 U.S.C. 552(b) and (c), each bureau of the 
Department of the Treasury shall promptly make the requested records 
available to any person in conformance with 5 U.S.C. 552(a)(3). The 
request must conform in every respect with the rules and procedures of 
this subpart and the applicable bureau's appendix to this subpart. Any 
request or appeal from the initial denial of a request that does not 
comply with the requirements in this subpart will not be considered 
subject to the time constraints of paragraphs (h), (i), and (j) of this 
section, unless and until the request is amended to comply. Bureaus 
shall promptly advise the requester in what respect the request or 
appeal is deficient so that it may be amended and resubmitted for 
consideration in accordance with this subpart. If a requester does not 
respond within 30 days to a communication from a bureau to amend the 
request in order for it to be in conformance with this subpart, the 
request file will be considered closed. When the request conforms with 
the requirements of this subpart, bureaus shall make every reasonable 
effort to comply with the request within the time constraints. If the 
description of the record requested is of a type that is not maintained 
by the bureau, the requester shall be so advised and the request shall 
be returned to the requester.
    (2) This subpart applies only to records in the possession or 
control of the bureau at the time of the request. Records considered to 
be responsive to the request are those in existence on or before the 
date of receipt of the request by the appropriate bureau official. 
Requests for the continuing production of records created after the date 
of the appropriate bureau official's receipt of the request shall not be 
honored. Bureaus shall provide the responsive record or records in the 
form or format requested if the record or records are readily 
reproducible by the bureau in that form or format. Bureaus shall make 
reasonable efforts to maintain their records in forms or formats that 
are reproducible for the purpose of disclosure. For purposes of this 
section, readily reproducible means, with respect to electronic format, 
a record or records that can be downloaded or transferred intact to a 
floppy disk, compact disk (CD), tape, or other electronic medium using 
equipment currently in use by the office or offices processing the 
request. Even though some records may initially be readily reproducible, 
the need to segregate exempt from nonexempt records may cause the 
releasable material to not be readily reproducible.
    (3) Requests for information classified pursuant to Executive Order 
12958, ``Classified National Security Information,'' require the 
responsible bureau to review the information to determine whether it 
continues to warrant classification. Information which no longer 
warrants classification under the Executive Order's criteria shall be 
declassified and made available to the requester, unless the information 
is otherwise exempt from disclosure.
    (4) When a bureau receives five or more requests for substantially 
the same records, it shall place those requests in front of an existing 
request backlog that the responsible official may have. Upon completion 
of processing, the released records shall be made available in the 
bureau's public reading room, and if created on or after November 1, 
1996, shall be made available in the electronic reading room of the 
bureau's web site.
    (b) Form of request. In order to be subject to the provisions of 
this section, the following must be satisfied.
    (1) The request for records shall be made in writing, signed by the 
person making the request, and state that it is made pursuant to the 
Freedom of Information Act, 5 U.S.C. 552, or this subpart.
    (2) The request shall indicate whether the requester is a commercial 
user, an educational institution, non-commercial scientific institution, 
representative of the news media, or ``other'' requester, subject to the 
fee provisions described in Sec. 1.7. In order for the Department to 
determine the proper category for fee purposes as defined in this 
section, a request for records shall also state how the records released 
will be used. This information shall not be used to determine the 
releasibility of any record or records. A

[[Page 16]]

determination of the proper category of requester shall be based upon a 
review of the requester's submission and the bureau's own records. Where 
a bureau has reasonable cause to doubt the use to which a requester will 
put the records sought, or where that use is not clear from the request 
itself, bureaus should seek additional clarification before assigning 
the request to a specific category. The categories of requesters are 
defined as follows:
    (i) Commercial. A commercial use request refers to a request from or 
on behalf of one who seeks information for a use or purpose that 
furthers the commercial, trade, or profit interests of the requester or 
the person on whose behalf the request is made, which can include 
furthering those interests through litigation. The bureaus may determine 
from the use specified in the request that the requester is a commercial 
user.
    (ii) Educational institution. This refers to a preschool, a public 
or private elementary or secondary school, an institution of graduate 
higher education, an institution of undergraduate higher education, an 
institution of professional education, and an institution of vocational 
education, which operates a program or programs of scholarly research. 
This category does not include requesters wanting records for use in 
meeting individual academic research or study requirements.
    (iii) Non-commercial scientific institution. This refers to an 
institution that is not operated on a ``commercial'' basis as that term 
is defined in paragraph (b)(2)(i) of this section, and which is operated 
solely for the purpose of conducting scientific research, the results of 
which are not intended to promote any particular product or industry.
    (iv) Representative of the news media. This refers to any person 
actively gathering news for an entity that is organized and operated to 
publish or broadcast news to the public. The term news means information 
that is about current events or that would be of current interest to the 
public. Examples of news media entities include television or radio 
stations broadcasting to the public at large, and publishers of 
periodicals (but only in those instances when they can qualify as 
disseminators of ``news'') who make their products available for 
purchase or subscription by the general public. These examples are not 
intended to be all-inclusive. In the case of ``freelance'' journalists, 
they may be regarded as working for a news organization if they can 
demonstrate a solid basis for expecting publication through that 
organization, even though not actually employed by it. A publication 
contract would be the clearest proof, but bureaus may also look to the 
past publication record of a requester in making this determination.
    (v) ``Other'' Requester. This refers to a requester who does not 
fall within any of the previously described categories.
    (3) The request must be properly addressed to the bureau that 
maintains the record. The functions of each bureau are summarized in The 
United States Government Manual which is issued annually and is 
available from the Superintendent of Documents. Both the envelope and 
the request itself should be clearly marked ``Freedom of Information Act 
Request.'' See the appendices to this subpart for the office or officer 
to which requests shall be addressed for each bureau. A requester in 
need of guidance in defining a request or determining the proper bureau 
to which a request should be sent may contact Disclosure Services at 
202/622-0930, or may write to Disclosure Services, Department of the 
Treasury, 1500 Pennsylvania Avenue, NW, Washington, DC 20220. Requesters 
may access the ``FOIA Home Page'' at the Department of the Treasury 
World Wide Web site at: http://www.treas.gov.
    (4) The request must reasonably describe the records in accordance 
with paragraph (d) of this section.
    (5) The request must set forth the address where the person making 
the request wants to be notified about whether or not the request will 
be granted.
    (6) The request must state whether the requester wishes to inspect 
the records or desires to have a copy made and furnished without first 
inspecting them.
    (7) The request must state the firm agreement of the requester to 
pay the fees for search, duplication, and review

[[Page 17]]

as may ultimately be determined in accordance with Sec. 1.7. The 
agreement may state the upper limit (but not less than $25) that the 
requester is willing to pay for processing the request. A request that 
fees be waived or reduced may accompany the agreement to pay fees and 
shall be considered to the extent that such request is made in 
accordance with Sec. 1.7(d) and provides supporting information to be 
measured against the fee waiver standard set forth in Sec. 1.7(d)(1). 
The requester shall be notified in writing of the decision to grant or 
deny the fee waiver. A requester shall be asked to provide an agreement 
to pay fees when the request for a fee waiver or reduction is denied and 
the initial request for records does not include such agreement. If a 
requester has an outstanding balance of search, review, or duplication 
fees due for FOIA request processing, the requirements of this paragraph 
are not met until the requester has remitted the outstanding balance 
due.
    (c) Requests for records not in control of bureau; referrals; 
consultations. (1) When a requested record is in the possession or under 
the control of a bureau of the Department other than the office to which 
the request is addressed, the request for the record shall be 
transferred to the appropriate bureau and the requester notified. This 
referral shall not be considered a denial of access within the meaning 
of these regulations. The bureau of the Department to which this 
referral is made shall treat this request as a new request addressed to 
it and the time limits for response set forth by paragraph (h)(1) of 
this section shall begin when the referral is received by the designated 
office or officer of the bureau.
    (2) When a requested record has been created by an agency or 
Treasury bureau other than the Treasury bureau possessing the record, 
the bureau having custody of the record shall refer the record to the 
originating agency or Treasury bureau for a direct response to the 
requester. The requester shall be informed of the referral unless 
otherwise instructed by the originating agency. This is not a denial of 
a FOIA request; thus no appeal rights accrue to the requester.
    (3) When a FOIA request is received for a record created by a 
Treasury bureau that includes information originated by another bureau 
of the Department of the Treasury or another agency, the record shall be 
referred to the originating agency or bureau for review and 
recommendation on disclosure. The agency or bureau shall respond to the 
referring office. The Treasury bureau shall not release any such records 
without prior consultation with the originating bureau or agency.
    (4) In certain instances and at the discretion of the Departmental 
Offices, requests having impact on two or more bureaus of the Department 
may be coordinated by the Departmental Offices.
    (d) Reasonable description of records. The request for records must 
describe the records in reasonably sufficient detail to enable employees 
who are familiar with the subject area of the request to locate the 
records without placing an unreasonable burden upon the Department. 
Whenever possible, a request should include specific information about 
each record sought, such as the date, title or name, author, recipients, 
and subject matter of the record. If the Department determines that the 
request does not reasonably describe the records sought, the requester 
shall be given an opportunity to provide additional information. Such 
opportunity may, when necessary, involve a discussion with knowledgeable 
Department of the Treasury personnel. The reasonable description 
requirement shall not be used by officers or employees of the Department 
of the Treasury to improperly withhold records from the public.
    (e) Requests for expedited processing. (1) When a request for 
records includes a request for expedited processing, both the envelope 
and the request itself must be clearly marked, ``Expedited Processing 
Requested.''
    (2) Records will be processed as soon as practicable when a 
requester asks for expedited processing in writing and is granted such 
expedited treatment by the Department. The requester must demonstrate a 
compelling need for expedited processing of the requested records. A 
compelling need is defined as follows:

[[Page 18]]

    (i) Failure to obtain the requested records on an expedited basis 
could reasonably be expected to pose an imminent threat to the life or 
physical safety of an individual. The requester shall fully explain the 
circumstances warranting such an expected threat so that the Department 
may make a reasoned determination that a delay in obtaining the 
requested records could pose such a threat; or
    (ii) With respect to a request made by a person primarily engaged in 
disseminating information, urgency to inform the public concerning 
actual or alleged Federal Government activity. A person ``primarily 
engaged in disseminating information'' does not include individuals who 
are engaged only incidentally in the dissemination of information. The 
standard of ``urgency to inform'' requires that the records requested 
pertain to a matter of current exigency to the American public and that 
delaying a response to a request for records would compromise a 
significant recognized interest to and throughout the American general 
public. The requester must adequately explain the matter or activity and 
why the records sought are necessary to be provided on an expedited 
basis.
    (3) A demonstration of a compelling need by a person making a 
request for expedited processing shall be made by a statement certified 
by the requester to be true and correct to the best of his or her 
knowledge and belief. The statement must be in the form prescribed by 28 
U.S.C. 1746, ``I declare under penalty of perjury that the foregoing is 
true and correct to the best of my knowledge and belief. Executed on 
[date].''
    (4) Upon receipt by the appropriate bureau official, a request for 
expedited processing shall be considered and a determination as to 
whether to grant or deny the request for expedited processing shall be 
made, and the requester notified, within 10 calendar days of the date of 
the request. However, in no event shall the bureau have fewer than five 
days (excluding Saturdays, Sundays, and legal public holidays) from the 
date of receipt of the request for such processing. The determination to 
grant or deny a request for expedited processing may be made solely on 
the information contained in the initial letter requesting expedited 
treatment.
    (5) Appeals of initial determinations to deny expedited processing 
must be made within 10 calendar days of the date of the initial letter 
of determination denying expedited processing. Both the envelope and the 
appeal itself shall be clearly marked, ``Appeal for Expedited 
Processing.''
    (6) An appeal determination regarding expedited processing shall be 
made, and the requester notified, within 10 days (excluding Saturdays, 
Sundays, and legal public holidays) from the date of receipt of the 
appeal.
    (f) Date of receipt of request. A request for records shall be 
considered to have been received on the date on which a complete request 
containing the information required by paragraph (b) of this section has 
been received. A determination that a request is deficient in any 
respect is not a denial of access, and such determinations are not 
subject to administrative appeal. Requests shall be stamped with the 
date of receipt by the office prescribed in the appropriate appendix. As 
soon as the date of receipt has been established, the requester shall be 
so informed and shall also be advised when to expect a response. The 
acknowledgment of receipt requirement shall not apply if a disclosure 
determination will be issued prior to the end of the 20-day time limit.
    (g) Search for record requested. Department of the Treasury 
employees shall search to identify and locate requested records, 
including records stored at Federal Records Centers. Searches for 
records maintained in electronic form or format may require the 
application of codes, queries, or other minor forms of programming to 
retrieve the requested records. Wherever reasonable, searches shall be 
done by electronic means. However, searches of electronic records are 
not required when such searches would significantly interfere with the 
operation of a Treasury automated information system or would require 
unreasonable effort to conduct. The Department of the Treasury is not 
required under 5 U.S.C. 552 to tabulate or compile information for the 
purpose of creating a record or records that do not exist.

[[Page 19]]

    (h) Initial determination. (1) In general. The officers designated 
in the appendices to this part shall make initial determinations either 
to grant or to deny in whole or in part requests for records. Such 
officers shall respond in the approximate order of receipt of the 
requests, to the extent consistent with sound administrative practice. 
These determinations shall be made and the requester notified within 20 
days (excepting Saturdays, Sundays, and legal public holidays) after the 
date of receipt of the request, as determined in accordance with 
paragraph (f) of this section, unless the designated officer invokes an 
extension pursuant to paragraph (j)(1) of this section or the requester 
otherwise agrees to an extension of the 20-day time limitation.
    (2) Granting of request. If the request is granted in full or in 
part, and if the requester wants a copy of the records, a copy of the 
records shall be mailed to the requester, together with a statement of 
the applicable fees, either at the time of the determination or shortly 
thereafter.
    (3) Inspection of records. In the case of a request for inspection, 
the requester shall be notified in writing of the determination, when 
and where the requested records may be inspected, and of the fees 
incurred in complying with the request. The records shall then promptly 
be made available for inspection at the time and place stated, in a 
manner that will not interfere with Department of the Treasury 
operations and will not exclude other persons from making inspections. 
The requester shall not be permitted to remove the records from the room 
where inspection is made. If, after making inspection, the requester 
desires copies of all or a portion of the requested records, copies 
shall be furnished upon payment of the established fees prescribed by 
Sec. 1.7. Fees may be charged for search and review time as stated in 
Sec. 1.7.
    (4) Denial of request. If it is determined that the request for 
records should be denied in whole or in part, the requester shall be 
notified by mail. The letter of notification shall:
    (i) State the exemptions relied on in not granting the request;
    (ii) If technically feasible, indicate the amount of information 
deleted at the place in the record where such deletion is made (unless 
providing such indication would harm an interest protected by the 
exemption relied upon to deny such material);
    (iii) Set forth the name and title or position of the responsible 
official;
    (iv) Advise the requester of the right to administrative appeal in 
accordance with paragraph (i) of this section; and
    (v) Specify the official or office to which such appeal shall be 
submitted.
    (5) No records found. If it is determined, after a thorough search 
for records by the responsible official or his delegate, that no records 
have been found to exist, the responsible official will so notify the 
requester in writing. The letter of notification will advise the 
requester of the right to administratively appeal the Department's 
determination that no records exist (i.e., to challenge the adequacy of 
the Department's search for responsive records) in accordance with 
paragraph (i) of this section. The response shall specify the official 
or office to which the appeal shall be submitted for review.
    (i) Administrative appeal. (1)(i) A requester may appeal a 
Department of the Treasury initial determination when:
    (A) Access to records has been denied in whole or in part;
    (B) There has been an adverse determination of the requester's 
category as provided in Sec. 1.7(d)(4);
    (C) A request for fee waiver or reduction has been denied;
    (D) It has been determined that no responsive records exist; or
    (E) A request for expedited processing has been denied.
    (ii) An appeal, other than an appeal for expedited processing, must 
be submitted within 35 days of the date of the initial determination or 
the date of the letter transmitting the last records released, whichever 
is later, except in the case of a denial for expedited processing. An 
appeal of a denial for expedited processing must be made within 10 days 
of the date of the initial determination to deny expedited processing 
(see Sec. 1.5(e)(5)). All appeals must be submitted to the official 
specified in the appropriate appendix to this subpart whose title and 
address should also

[[Page 20]]

have been included in the initial determination. An appeal that is 
improperly addressed shall be considered not to have been received by 
the Department until the office specified in the appropriate appendix 
receives the appeal.
    (2) The appeal shall--
    (i) Be made in writing and signed by the requester or his or her 
representative;
    (ii) Be addressed to and mailed or hand delivered within 35 days (or 
within 10 days when expedited processing has been denied) of the date of 
the initial determination, or the date of the letter transmitting the 
last records released, whichever is later, to the office or officer 
specified in the appropriate appendix to this subpart and also in the 
initial determination. (See the appendices to this subpart for the 
address to which appeals made by mail should be addressed);
    (iii) Set forth the address where the requester desires to be 
notified of the determination on appeal;
    (iv) Specify the date of the initial request and date of the letter 
of initial determination, and, where possible, enclose a copy of the 
initial request and the initial determination being appealed.
    (3)(i) Appeals shall be stamped with the date of their receipt by 
the office to which addressed, and shall be processed in the approximate 
order of their receipt. The receipt of the appeal shall be acknowledged 
by the office or officer specified in the appropriate appendix to this 
subpart and the requester advised of the date the appeal was received 
and the expected date of response. The decision to affirm the initial 
determination (in whole or in part) or to grant the request for records 
shall be made and notification of the determination mailed within 20 
days (exclusive of Saturdays, Sundays, and legal public holidays) after 
the date of receipt of the appeal, unless extended pursuant to paragraph 
(j)(1) of this section. If it is decided that the initial determination 
is to be upheld (in whole or in part) the requester shall be--
    (A) Notified in writing of the denial;
    (B) Notified of the reasons for the denial, including the FOIA 
exemptions relied upon;
    (C) Notified of the name and title or position of the official 
responsible for the determination on appeal; and
    (D) Provided with a statement that judicial review of the denial is 
available in the United States District Court for the judicial district 
in which the requester resides or has a principal place of business, the 
judicial district in which the requested records are located, or the 
District of Columbia in accordance with 5 U.S.C. 552(a)(4)(B).
    (ii) If the initial determination is reversed on appeal, the 
requester shall be so notified and the request shall be processed 
promptly in accordance with the decision on appeal.
    (4) If a determination cannot be made within the 20-day period (or 
within a period of extension pursuant to paragraph (j)(1) of this 
section), the requester may be invited to agree to a voluntary extension 
of the 20-day appeal period. This voluntary extension shall not 
constitute a waiver of the right of the requester ultimately to commence 
an action in a United States district court.
    (j) Time extensions; unusual circumstances. (1) In unusual 
circumstances, the time limitations specified in paragraphs (h) and (i) 
of this section may be extended by written notice from the official 
charged with the duty of making the determination to the person making 
the request or appeal setting forth the reasons for this extension and 
the date on which the determination is expected to be sent. As used in 
this paragraph, unusual circumstances means, but only to the extent 
reasonably necessary to the proper processing of the particular 
requests:
    (i) The need to search for and collect the requested records from 
field facilities or other establishments that are separate from the 
office processing the request;
    (ii) The need to search for, collect, and appropriately examine a 
voluminous amount of separate and distinct records which are demanded in 
a single request; or
    (iii) The need for consultation, which shall be conducted with all 
practicable speed, with another agency having a substantial interest in 
the determination of the request, or among two or

[[Page 21]]

more bureaus or components of bureaus of the Department of the Treasury 
having substantial subject matter interest therein.
    (2) Any extension or extensions of time shall not cumulatively total 
more than 10 days (exclusive of Saturdays, Sundays, and legal public 
holidays). However, if additional time is needed to process the request, 
the bureau shall notify the requester and provide the requester an 
opportunity to limit the scope of the request or arrange for an 
alternative time frame for processing the request or a modified request. 
The requester shall retain the right to define the desired scope of the 
request, as long as it meets the requirements contained in this subpart.
    (3) Bureaus may establish multitrack processing of requests based on 
the amount of work or time, or both, involved in processing requests.
    (4) If more than one request is received from the same requester, or 
from a group of requesters acting in concert, and the Department 
believes that such requests constitute a single request which would 
otherwise satisfy the unusual circumstances specified in paragraph 
(j)(1) of this section, and the requests involve clearly related 
matters, the Department may aggregate these requests for processing 
purposes.
    (k) Failure to comply. If a bureau of the Department of the Treasury 
fails to comply with the time limits specified in paragraphs (h) or (i) 
of this section , or the time extensions of paragraph (j) of this 
section, any person making a request for records in accordance with 
Sec. 1.5 shall be considered to have exhausted administrative remedies 
with respect to the request. Accordingly, the person making the request 
may initiate suit as set forth in paragraph (l) of this section.
    (l) Judicial review. If an adverse determination is made upon appeal 
pursuant to paragraph (i) of this section, or if no determination is 
made within the time limits specified in paragraphs (h) and (i) of this 
section, together with any extension pursuant to paragraph (j)(1) of 
this section or within the time otherwise agreed to by the requester, 
the requester may commence an action in a United States district court 
in the district in which he resides, in which his principal place of 
business is located, in which the records are situated, or in the 
District of Columbia, pursuant to 5 U.S.C. 552(a)(4).
    (m) Preservation of records. Under no circumstances shall records be 
destroyed while they are the subject of a pending request, appeal, or 
lawsuit under the FOIA.
    (n) Processing requests that are not properly addressed. A request 
that is not properly addressed as specified in the appropriate appendix 
to this subpart shall be forwarded to the appropriate bureau or bureaus 
for processing. If the recipient of the request does not know the 
appropriate bureau to forward it to, the request shall be forwarded to 
the Departmental Disclosure Officer (Disclosure Services, DO), who will 
determine the appropriate bureau. A request not addressed to the 
appropriate bureau will be considered to have been received for purposes 
of paragraph (f) of this section when the request has been received by 
the appropriate bureau office as designated in the appropriate appendix 
to this subpart. An improperly addressed request, when received by the 
appropriate bureau office, shall be acknowledged by that bureau.



Sec. 1.6  Business information.

    (a) In general. Business information provided to the Department of 
the Treasury by a business submitter shall not be disclosed pursuant to 
a Freedom of Information Act request except in accordance with this 
section.
    (b) Notice to business submitters. A bureau shall provide a business 
submitter with prompt written notice of receipt of a request or appeal 
encompassing its business information whenever required in accordance 
with paragraph (c) of this section, and except as is provided in 
paragraph (g) of this section. Such written notice shall either describe 
the exact nature of the business information requested or provide copies 
of the records or portions of records containing the business 
information.
    (c) When notice is required. The bureau shall provide a business 
submitter with notice of receipt of a request or appeal whenever:
    (1) The business submitter has in good faith designated the 
information

[[Page 22]]

as commercially or financially sensitive information, or
    (2) The bureau has reason to believe that disclosure of the 
information could reasonably be expected to cause substantial 
competitive harm.
    (3) Notice of a request for business information falling within 
paragraph (c)(1) or (2) of this section shall be required for a period 
of not more than ten years after the date of submission unless the 
business submitter requests, and provides acceptable justification for, 
a specific notice period of greater duration.
    (4) The submitter's claim of confidentiality should be supported by 
a statement by an authorized representative of the company providing 
specific justification that the information in question is in fact 
confidential commercial or financial information and has not been 
disclosed to the public.
    (d) Opportunity to object to disclosure. (1) Through the notice 
described in paragraph (b) of this section, a bureau shall afford a 
business submitter ten days from the date of the notice (exclusive of 
Saturdays, Sundays, and legal public holidays) to provide the bureau 
with a detailed statement of any objection to disclosure. Such statement 
shall specify all grounds for withholding any of the information under 
any exemption of the Freedom of Information Act and, in the case of 
Exemption 4, shall demonstrate why the information is considered to be a 
trade secret or commercial or financial information that is privileged 
or confidential. Information provided by a business submitter pursuant 
to this paragraph may itself be subject to disclosure under the FOIA.
    (2) When notice is given to a submitter under this section, the 
requester shall be advised that such notice has been given to the 
submitter. The requester shall be further advised that a delay in 
responding to the request may be considered a denial of access to 
records and that the requester may proceed with an administrative appeal 
or seek judicial review, if appropriate. However, the requester will be 
invited to agree to a voluntary extension of time so that the bureau may 
review the business submitter's objection to disclose.
    (e) Notice of intent to disclose. A bureau shall consider carefully 
a business submitter's objections and specific grounds for nondisclosure 
prior to determining whether to disclose business information. Whenever 
a bureau decides to disclose business information over the objection of 
a business submitter, the bureau shall forward to the business submitter 
a written notice which shall include:
    (1) A statement of the reasons for which the business submitter's 
disclosure objections were not sustained;
    (2) A description of the business information to be disclosed; and
    (3) A specified disclosure date which is not less than ten days 
(exclusive of Saturdays, Sundays, and legal public holidays) after the 
notice of the final decision to release the requested information has 
been mailed to the submitter. Except as otherwise prohibited by law, a 
copy of the disclosure notice shall be forwarded to the requester at the 
same time.
    (f) Notice of FOIA lawsuit. Whenever a requester brings suit seeking 
to compel disclosure of business information covered by paragraph (c) of 
this section, the bureau shall promptly notify the business submitter.
    (g) Exception to notice requirement. The notice requirements of this 
section shall not apply if:
    (1) The bureau determines that the information shall not be 
disclosed;
    (2) The information lawfully has been published or otherwise made 
available to the public; or
    (3) Disclosure of the information is required by law (other than 5 
U.S.C. 552).



Sec. 1.7  Fees for services.

    (a) In general. This fee schedule is applicable uniformly throughout 
the Department of the Treasury and pertains to requests processed under 
the Freedom of Information Act. Specific levels of fees are prescribed 
for each of the following categories of requesters. Requesters are asked 
to identify the applicable fee category they belong to in their initial 
request in accordance with Sec. 1.5(b).
    (1) Commercial use requesters. These requesters are assessed charges 
which

[[Page 23]]

recover the full direct costs of searching for, reviewing, and 
duplicating the records sought. Commercial use requesters are not 
entitled to two hours of free search time or 100 free pages of 
duplication of documents. Moreover, when a request is received for 
disclosure that is primarily in the commercial interest of the 
requester, the Department is not required to consider a request for a 
waiver or reduction of fees based upon the assertion that disclosure 
would be in the public interest. The Department may recover the cost of 
searching for and reviewing records even if there is ultimately no 
disclosure of records, or no records are located.
    (2) Educational and Non-Commercial Scientific Institution 
Requesters. Records shall be provided to requesters in these categories 
for the cost of duplication alone, excluding charges for the first 100 
pages. To be eligible, requesters must show that the request is made 
under the auspices of a qualifying institution and that the records are 
not sought for a commercial use, but are sought in furtherance of 
scholarly (if the request is from an educational institution) or 
scientific (if the request is from a non-commercial scientific 
institution) research. These categories do not include requesters who 
want records for use in meeting individual academic research or study 
requirements.
    (3) Requesters who are Representatives of the News Media. Records 
shall be provided to requesters in this category for the cost of 
duplication alone, excluding charges for the first 100 pages.
    (4) All Other Requesters. Requesters who do not fit any of the 
categories described above shall be charged fees that will recover the 
full direct cost of searching for and duplicating records that are 
responsive to the request, except that the first 100 pages of 
duplication and the first two hours of search time shall be furnished 
without charge. The Department may recover the cost of searching for 
records even if there is ultimately no disclosure of records, or no 
records are located. Requests from persons for records about themselves 
filed in the Department's systems of records shall continue to be 
treated under the fee provisions of the Privacy Act of 1974 which permit 
fees only for duplication, after the first 100 pages are furnished free 
of charge.
    (b) Fee waiver determination. Where the initial request includes a 
request for reduction or waiver of fees, the responsible official shall 
determine whether to grant the request for reduction or waiver before 
processing the request and notify the requester of this decision. If the 
decision does not waive all fees, the responsible official shall advise 
the requester of the fact that fees shall be assessed and, if 
applicable, payment must be made in advance pursuant to Sec. 1.7(e)(2).
    (c) When fees are not charged. (1) No fee shall be charged for 
monitoring a requester's inspection of records.
    (2) Fees shall be charged in accordance with the schedule contained 
in paragraph (g) of this section for services rendered in responding to 
requests for records, unless any one of the following applies:
    (i) Services were performed without charge;
    (ii) The cost of collecting a fee would be equal to or greater than 
the fee itself; or,
    (iii) The fees were waived or reduced in accordance with paragraph 
(d) of this section.
    (d) Waiver or reduction of fees. (1) Fees may be waived or reduced 
on a case-by-case basis in accordance with this paragraph by the 
official who determines the availability of the records, provided such 
waiver or reduction has been requested in writing. Fees shall be waived 
or reduced by this official when it is determined, based upon the 
submission of the requester, that a waiver or reduction of the fees is 
in the public interest because furnishing the information is likely to 
contribute significantly to public understanding of the operations or 
activities of the government and is not primarily in the commercial 
interest of the requester. Fee waiver/reduction requests shall be 
evaluated against the fee waiver policy guidance issued by the 
Department of Justice on April 2, 1987.
    (2) Normally no charge shall be made for providing records to state 
or foreign governments, international governmental organizations, or 
local government agencies or offices.

[[Page 24]]

    (3) Appeals from denials of requests for waiver or reduction of fees 
shall be decided in accordance with the criteria set forth in paragraph 
(d)(1) of this section by the official authorized to decide appeals from 
denials of access to records. Appeals shall be addressed in writing to 
the office or officer specified in the appropriate appendix to this 
subpart within 35 days of the denial of the initial request for waiver 
or reduction and shall be decided within 20 days (excluding Saturdays, 
Sundays, and legal public holidays).
    (4) Appeals from an adverse determination of the requester's 
category as described in Sec. 1.5(b)(2) and provided in Sec. 1.5(i)(1) 
shall be decided by the official authorized to decide appeals from 
denials of access to records and shall be based upon a review of the 
requester's submission and the bureau's own records. Appeals shall be 
addressed in writing to the office or officer specified in the 
appropriate appendix to this subpart within 35 days of the date of the 
bureau's determination of the requester's category and shall be decided 
within 20 days (excluding Saturdays, Sundays, and legal public 
holidays).
    (e) Advance notice of fees. (1) When the fees for processing the 
request are estimated to exceed the limit set by the requester, and that 
amount is less than $250, the requester shall be notified of the 
estimated costs. The requester must provide an agreement to pay the 
estimated costs; however, the requester shall also be given an 
opportunity to reformulate the request in an attempt to reduce fees.
    (2) If the requester has failed to state a limit and the costs are 
estimated to exceed $250.00, the requester shall be notified of the 
estimated costs and must pre-pay such amount prior to the processing of 
the request, or provide satisfactory assurance of full payment if the 
requester has a history of prompt payment of FOIA fees. The requester 
shall also be given an opportunity to reformulate the request in such a 
way as to constitute a request for responsive records at a reduced fee.
    (3) When the Department or a bureau of the Department acts under 
paragraphs (e)(1) or (2) of this section, the administrative time limits 
of 20 days (excluding Saturdays, Sundays, and legal public holidays) 
from receipt of initial requests or appeals, plus extensions of these 
time limits, shall begin only after fees have been paid, a written 
agreement to pay fees has been provided, or a request has been 
reformulated.
    (f) Form of payment. (1) Payment may be made by check or money order 
payable to the Treasury of the United States or the relevant bureau of 
the Department of the Treasury.
    (2) The Department of the Treasury reserves the right to request 
prepayment after a request is processed and before documents are 
released.
    (3) When costs are estimated or determined to exceed $250, the 
Department shall either obtain satisfactory assurance of full payment of 
the estimated cost where the requester has a history of prompt payment 
of FOIA fees or require a requester to make an advance payment of the 
entire estimated or determined fee before continuing to process the 
request.
    (4) If a requester has previously failed to pay a fee within 30 days 
of the date of the billing, the requester shall be required to pay the 
full amount owed plus any applicable interest, and to make an advance 
payment of the full amount of the estimated fee before the Department 
begins to process a new request or the pending request. Whenever 
interest is charged, the Department shall begin assessing interest on 
the 31st day following the day on which billing was sent. Interest shall 
be at the rate prescribed in 31 U.S.C. 3717. In addition, the Department 
shall take all steps authorized by the Debt Collection Act of 1982, as 
amended by the Debt Collection Improvement Act of 1996, including 
administrative offset pursuant to 31 CFR Part 5, disclosure to consumer 
reporting agencies and use of collection agencies, to effect payment.
    (g) Amounts to be charged for specific services. The fees for 
services performed by a bureau of the Department of the Treasury shall 
be imposed and collected as set forth in this paragraph.
    (1) Duplicating records. All requesters, except commercial 
requesters, shall receive the first 100 pages duplicated without charge. 
Absent a determination to waive fees, a bureau shall charge requesters 
as follows:

[[Page 25]]

    (i) $.20 per page, up to 8\1/2\x14, made by photocopy or 
similar process.
    (ii) Photographs, films, and other materials--actual cost of 
duplication.
    (iii) Other types of duplication services not mentioned above--
actual cost.
    (iv) Material provided to a private contractor for copying shall be 
charged to the requester at the actual cost charged by the private 
contractor.
    (2) Search services. Bureaus shall charge for search services 
consistent with the following:
    (i) Searches for other than electronic records. The Department shall 
charge for search time at the salary rate(s) (basic pay plus 16 percent) 
of the employee(s) making the search. However, where a single class of 
personnel is used exclusively (e.g., all administrative/clerical, or all 
professional/executive), an average rate for the range of grades 
typically involved may be established. This charge shall include 
transportation of personnel and records necessary to the search at 
actual cost. Fees may be charged for search time as prescribed in Sec. 
1.7, even if the search does not yield any responsive records, or if 
records are denied.
    (ii) Searches for electronic records. The Department shall charge 
for actual direct cost of the search, including computer search time, 
runs, and the operator's salary. The fee for computer output shall be 
actual direct costs. For requesters in the ``all other'' category, when 
the cost of the search (including the operator time and the cost of 
operating the computer to process a request) equals the equivalent 
dollar amount of two hours of the salary of the person performing the 
search (i.e., the operator), the charge for the computer search will 
begin.
    (3) Review of records. The Department shall charge commercial use 
requesters for review of records at the salary rate(s) (i.e., basic pay 
plus 16 percent) of the employee(s) making the review. However, when a 
single class of personnel is used exclusively (e.g., all administrative/
clerical, or all professional/executive), an average rate for the range 
of grades typically involved may be established. Fees may be charged for 
review time as prescribed in Sec. 1.7, even if records ultimately are 
not disclosed.
    (4) Inspection of records. Fees for all services provided shall be 
charged whether or not copies are made available to the requester for 
inspection.
    (5) Other services. Other services and materials requested which are 
not covered by this part nor required by the FOIA are chargeable at the 
actual cost to the Department. This includes, but is not limited to:
    (i) Certifying that records are true copies;
    (ii) Sending records by special methods such as express mail, etc.
    (h) Aggregating requests. When the Department or a bureau of the 
Department reasonably believes that a requester or group of requesters 
is attempting to break a request down into a series of requests for the 
purpose of evading the assessment of fees, the agency shall aggregate 
any such requests and charge accordingly.

         Appendix A to Subpart A of Part 1--Departmental Offices

    1. In general. This appendix applies to the Departmental Offices as 
defined in 31 CFR 1.1(a)(1).
    2. Public reading room. The public reading room for the Departmental 
Offices is the Treasury Library. The Library is located in the Main 
Treasury Building, 1500 Pennsylvania Avenue, NW., Washington, DC 20220. 
For building security purposes, visitors are required to make an 
appointment by calling 202-622-0990.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of the Departmental Offices 
will be made by the head of the organizational unit having immediate 
custody of the records requested or the delegate of such official. 
Requests for records should be addressed to: Freedom of Information 
Request, DO, Assistant Director, Disclosure Services, Department of the 
Treasury, 1500 Pennsylvania Avenue, NW, Washington, DC 20220.
    4. Administrative appeal of initial determination to deny records.
    (i) Appellate determinations under 31 CFR 1.5(i) with respect to 
records of the Departmental Offices will be made by the Secretary, 
Deputy Secretary, Under Secretary, General Counsel, Inspector General, 
Treasury Inspector General for Tax Administration, Treasurer of the 
United States, or Assistant Secretary having jurisdiction over the 
organizational unit which has immediate custody of the records 
requested, or the delegate of such officer.

[[Page 26]]

    (ii) Appellate determinations with respect to requests for expedited 
processing shall be made by the Deputy Assistant Secretary 
(Administration).
    (iii) Appeals should be addressed to:

Freedom of Information Appeal, DO, Assistant Director, Disclosure 
Services, Department of the Treasury, 1500 Pennsylvania Avenue, NW., 
Washington, DC 20220.

    5. Delivery of process. Service of process will be received by the 
General Counsel of the Department of the Treasury or the delegate of 
such officer and shall be delivered to the following location: General 
Counsel, Department of the Treasury, Room 3000, Main Treasury Building, 
1500 Pennsylvania Avenue, NW., Washington, DC 20220.

       Appendix B to Subpart A of Part 1--Internal Revenue Service

    1. In general. This appendix applies to the Internal Revenue 
Service. See also 26 CFR 601.702.
    2. Public reading room. The public reading rooms for the Internal 
Revenue Service are maintained at the following location:

                             National Office

                             Mailing Address

Freedom of Information Reading Room, PO Box 795, Ben Franklin Station, 
Washington, DC 20044

                             Walk-In Address

Room 1621, 1111 Constitution Avenue, NW., Washington, DC

                            Northeast Region

                             Mailing Address

Freedom of Information Reading Room, PO Box 5138, E:QMS:D, New York, NY 
10163

                             Walk-In Address

11th Floor, 110 W. 44th Street, New York, NY

                            Midstates Region

                             Mailing Address

Freedom of Information Reading Room, Mail Code 7000 DAL, 1100 Commerce 
Street, Dallas, TX 75242

                             Walk-In Address

10th Floor, Rm. 10B37, 1100 Commerce Street, Dallas, TX

                            Southeast Region

                             Mailing Address

401 W. Peachtree Street, NW., Stop 601D, Room 868, Atlanta, GA 30365

                             Walk-In Address

Same as mailing address

                             Western Region

                             Mailing Address

1301 Clay Street, Stop 800-S, Oakland, CA 94612

                             Walk-In Address

8th Floor, 1301 Clay Street, Oakland, CA

    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of the Internal Revenue 
Service, grant expedited processing, grant a fee waiver, or determine 
requester category will be made by those officials specified in 26 CFR 
601.702.
    4. Administrative appeal of initial determination to deny records. 
Appellate eterminations under 31 CFR 1.5(i) with respect to records of 
the Internal Revenue Service will be made by the Commissioner of 
Internal Revenue or the delegate of such officer. Appeals made by mail 
should be addressed to:

Freedom of Information Appeal, Commissioner of Internal Revenue Service, 
c/o Ben Franklin Station, PO Box 929, Washington, DC 20044.

    Appeals may be delivered personally to the Assistant Chief Counsel 
(Disclosure Litigation) CC:EL:D, Office of the Chief Counsel, Internal 
Revenue Building, 1111 Constitution Avenue NW., Washington, D.C.
    5. Delivery of process. Service of process shall be effected 
consistent with Rule 4 of the Federal Rule of Civil Procedure, and 
directed to the Commissioner of Internal Revenue at the following 
address:

Commissioner, Internal Revenue Service, 1111 Constitution Avenue NW., 
Washington, DC 20224. Attention: CC:EL:D.

    Appendix C to Subpart A of Part 1--United States Customs Service

    1. In general. This appendix applies to the United States Customs 
Service.
    2. Public reading room. The public reading room for the United 
States Customs Service is maintained at the following location:

United States Customs Service, 1300 Pennsylvania Avenue NW., Washington, 
DC 20229.

    3. Requests for records.
    (a) Headquarters--Initial determinations under 31 CFR 1.5(h) as to 
whether to grant requests for records will be made by the appropriate 
Division Director at Customs Service Headquarters having custody of or 
functional jurisdiction over the subject matter of the requested 
records. If the request relates to records maintained in an office which 
is

[[Page 27]]

not within a division, the initial determination shall be made by the 
individual designated for that purpose by the Assistant Commissioner 
having responsibility for that office. Requests may be mailed or 
delivered in person to:

Freedom of Information Act, Chief, Disclosure Law Branch, U.S. Customs 
Service, 1300 Pennsylvania Avenue, NW., Washington, DC 20229.

    (b) Field Offices--Initial determinations under 31 CFR 1.5(h) as to 
whether to grant requests for records maintained by the Office of 
Investigations will be made by the Special Agent in Charge in whose 
office the records are maintained. Initial determinations of records 
maintained in Customs Ports of Entry as to whether or not to grant 
requests for records will be made by the Port Director of the Customs 
Service Port having jurisdiction over the Port of Entry in which the 
records are maintained. Requests may be mailed or faxed to or delivered 
personally to the respective Special Agents in Charge or Port Directors 
of the Customs Service Ports at the following locations:

               Offices of Special Agents in Charge (SACS)

                              Atlanta--SAC

1691 Phoenix Blvd., Suite 250, Atlanta, Georgia 30349, Phone (770) 994-
2230, FAX (770) 994-2262

                              Detroit--SAC

McNamara Federal Building, 477 Michigan Avenue, Room 350, Detroit, 
Michigan 8226-2568, Phone (313) 226-3166, FAX (313) 226-6282

                             Baltimore--SAC

40 South Gay Street, 3rd Floor Baltimore, Maryland 21202, Phone (410) 
962-2620, FAX (410) 962-3469

                              El Paso--SAC

9400 Viscount Blvd., Suite 200, El Paso, Texas 79925, Phone (915) 540-
5700, FAX (915) 540-5754

                               Boston--SAC

10 Causeway Street, Room 722, Boston, MA 02222-1054, Phone (617) 565-
7400, FAX (617) 565-7422

                              Houston--SAC

4141 N. Sam Houston Pkwy, E., Houston, Texas 77032, Phone (281) 985-
0500, FAX (281) 985-0505

                              Buffalo--SAC

111 West Huron Street, Room 416, Buffalo, New York 14202, Phone (716) 
551-4375, FAX (716) 551-4379

                            Los Angeles--SAC

300 South Ferry St., Room 2037, Terminal Island, CA 90731, Phone (310) 
514-6231, FAX (310) 514-6280

                              Chicago--SAC

610 South Canal Street, Room 1001, Chicago, Illinois 60607, Phone (312) 
353-8450, FAX (312) 353-8455

                               Miami--SAC

8075 NW 53rd Street, Scranton Building, Miami, Florida 33166, Phone 
(305) 597-6030, FAX (305) 597-6227

                               Denver--SAC

115 Inverness Drive, East, Suite 300, Englewood, CO 80112-5131, Phone 
(303) 84-6480, FAX (303) 784-6490

                            New Orleans--SAC

423 Canal Street, Room 207, New Orleans, LA 70130, Phone (504) 670-2416, 
FAX (504) 589-2059

                              New York--SAC

6 World Trade Center, New York, New York 10048-0945, Phone (212) 466-
2900, FAX (212) 466-2903

                              San Juan--SAC

1, La Puntilla Street, Room 110, San Juan, PR 00901, Phone 
(787) 729-6975 FAX (787) 729-6646

                            San Antonio--SAC

10127 Morocco, Suite 180, San Antonio, Texas 78216, Phone (210) 229-
4561, FAX (210) 229-4582

                              Seattle--SAC

1000--2nd Avenue, Suite 2300, Seattle, Washington, 98104, Phone (206) 
553-7531, FAX (206) 553-0826

                             San Diego--SAC

185 West ``F'' Street, Suite 600, San Diego, CA 92101, Phone (619) 57-
6850, FAX (619) 557-5109

                               Tampa--SAC

2203 North Lois Avenue, Suite 600, Tampa, Florida 33607, Phone (813) 
348-1881, FAX (813) 348-1871

                           San Francisco--SAC

1700 Montgomery Street, Suite 445, San Francisco, CA 94111, Phone (415) 
705-4070, FAX (415) 705-4065

                               Tucson--SAC

555 East River Road, Tucson, Arizona 85704, Phone (520) 670-6026, FAX 
(520) 70-6233

[[Page 28]]

                          Customs Service Ports

Anchorage: 605 West Fourth Avenue Anchorage, AK 99501. Phone: (907) 271-
2675; FAX: (907) 271-2684.
Minneapolis: 110 South Street Minneapolis, MN 55401. Phone: (612) 348-
1690; FAX: (612) 348-1630.
Baltimore: 200 St. Paul Place Baltimore, MD 21202. Phone: (410) 962-
2666; FAX: (410) 962-9335.
Mobile: 150 North Royal Street Mobile, AL 36602. Phone: (205) 441-5106; 
FAX: (205) 441-6061.
Blaine: 9901 Pacific Highway Blaine, WA 98230. Phone: (360) 332-5771; 
FAX: (360) 332-4701.
New Orleans: 423 Canal Street New Orleans, LA 70130. Phone: (504) 589-
6353; FAX: (504) 589-7305.
Boston: 10 Causeway Street Boston, MA 02222-1059. Phone: (617) 565-6147; 
FAX: (617) 565-6137.
New York: 6 World Trade Center New York, NY 10048. Phone: (212) 466-
4444; FAX: (212) 455-2097.
Buffalo: 111 West Huron Street Buffalo, NY 14202-22378. Phone: (716) 
551-4373; FAX: (716) 551-5011.
New York-JFK Area: Building 77 Jamaica, NY 11430. Phone: (718) 
553-1542; FAX: (718) 553-0077.
Champlain: 35 West Service Road Rts. 1 & 9 South Champlain, NY 12919. 
Phone: (518) 298-8347; FAX: (518) 298-8314.
New York-NY/Newark Area: Hemisphere Center, Newark, NJ 07114. Phone: 
(201) 645-3760; FAX: (201) 645-6634.
Charleston: 200 East Bay Street Charleston, SC 29401. Phone: (803) 727-
4296; FAX: (803) 727-4043.
Nogales: 9 North Grand Avenue Nogales, AZ 85621. Phone: (520) 287-1410; 
FAX: (520) 287-1421.
Charlotte: 1801-K Cross Beam Drive Charlotte, NC 28217. Phone: (704) 
329-6101; FAX: (704) 329-6103.
Norfolk: 200 Granby Street Norfolk, VA 23510. Phone: (804) 441-3400; 
FAX: (804) 441-6630.
Charlotte/Amalie: Main Post OFC-Sugar Estate St. Thomas, VI 00801. 
Phone: (809) 774-2511; FAX: (809) 776-3489.
Pembina: PO Box 610 Pembina, ND 58271. Phone: (701) 825-6201; FAX: (701) 
825-6473.
Chicago: 610 South Canal Street Chicago, IL 60607. Phone: (312) 353-
6100; FAX: (312) 353-2337.
Philadelphia: 2nd & Chestnut Streets Philadelphia, PA 19106. Phone: 
(215) 597-4605; FAX: (215) 597-2103.
Cleveland: 56 Erieview Plaza Cleveland, OH 44114. Phone: (216) 891-3804; 
FAX: (216) 891-3836.
Portland, Oregon: 511 NW Broadway Portland, OR 97209. Phone: (503) 326-
2865; FAX: (503) 326-3511.
Dallas/Fort Worth: PO Box 61905 Dallas/Fort Worth Airport, TX 75261. 
Phone: (972) 574-2170; FAX: (972) 574-4818.
Providence: 49 Pavilion Avenue Providence, RI 02905. Phone: (401) 941-
6326; FAX: (401) 941-6628.
Denver: 4735 Oakland Street Denver, CO 80239. Phone: (303) 361-0715; 
FAX: (303) 361-0722.
San Diego: 610 West Ash Street San Diego, CA 92188. Phone: (619) 557-
6758; FAX: (619) 557-5314.
Detroit: 477 Michigan Avenue Detroit, MI 48226. Phone: (313) 226-3178; 
FAX: (313) 226-3179.
San Francisco: 555 Battery Avenue San Francisco, CA 94111. Phone: (415) 
744-7700; FAX: (415) 744-7710.
Duluth: 515 West 1st Street Duluth, MN 55802-1390. Phone: (218) 720-
5201; FAX: (218) 720-5216.
San Juan: 1 La Puntilla San Juan, PR 00901. Phone: (809) 729-
6965; FAX: (809) 729-6978.
El Paso: 9400 Viscount Boulevard El Paso, TX 79925. Phone: (915) 540-
5800; FAX: (915) 540-3011.
Savannah: 1 East Bay Street Savannah, GA 31401. Phone: (912) 652-4256; 
FAX: (912) 652-4435.
Great Falls: 300 2nd Avenue South Great Falls, MT 59403. Phone: (406) 
453-7631; FAX: (406) 453-7069.
Seattle: 1000 2nd Avenue Seattle, WA 98104-1049. Phone: (206) 553-0770; 
FAX: (206) 553-2970.
Honolulu: 335 Merchant Street Honolulu, HI 96813. Phone: (808) 522-8060; 
FAX: (808) 522-8060.
St. Albans: P.O. Box 1490 St. Albans, VT 05478. Phone: (802) 524-7352; 
FAX: (802) 527-1338.
Houston/Galveston: 1717 East Loop Houston, TX 77029. Phone: (713) 985-
6712; FAX: (713) 985-6705.
St. Louis: 4477 Woodson Road St. Louis, MO 63134-3716. Phone: (314) 428-
2662; FAX: (314) 428-2889.
Laredo/Colombia: P.O. Box 3130 Laredo, TX 78044. Phone: (210) 726-2267; 
FAX: (210) 726-2948.
Tacoma: 2202 Port of Tacoma Road, Tacoma, WA 98421. Phone: (206) 593-
6336; FAX: (206) 593-6351.
Los Angeles: 300 South Ferry Street Terminal Island, CA 90731. Phone: 
(310) 514-6001; FAX: (310) 514-6769.
Tampa: 4430 East Adamo Drive Tampa, FL 33605. Phone: (813) 228-2381; 
FAX: (813) 225-7309.
Miami Airport: 6601 West 25th Street Miami, FL 33102-5280. Phone: (305) 
869-2800; FAX: (305) 869-2822.
Washington, DC: P.O. Box 17423 Washington, DC. 20041. Phone: (703) 318-
5900; FAX: (703) 318-6706.

[[Page 29]]

Milwaukee: P.O. Box 37260 Milwaukee, WI 53237-0260. Phone: (414) 571-
2860; FAX: (414) 762-0253.

    (c) All such requests should be conspicuously labeled on the face of 
the envelope, ``Freedom of Information Act Request'' or ``FOIA 
Request''.
    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) will be made by the 
Assistant Commissioner of Customs (Office of Regulations and Rulings), 
or his designee, and all such appeals should be mailed, faxed (202/927-
1873) or personally delivered to the United States Customs Service, 1300 
Pennsylvania Avenue, NW., Washington, DC 20229. If possible, a copy of 
the initial letter of determination should be attached to the appeal.
    5. Delivery of process. Service of process will be received by the 
Chief Counsel, United States Customs Service, 1300 Pennsylvania Avenue, 
NW., Washington, DC 20229.

     Appendix D to Subpart A of Part 1--United States Secret Service

    1. In general. This appendix applies to the United States Secret 
Service.
    2. Public reading room. The United States Secret Service will 
provide a room on an ad hoc basis when necessary. Contact the Disclosure 
Officer, Room 720, 1800 G Street, NW., Washington, DC 20223 to make 
appointments.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of the United States Secret 
Service will be made by the Freedom of Information and Privacy Acts 
Officer, United States Secret Service. Requests may be mailed or 
delivered in person to:

Freedom of Information Act Request, FOIA and Privacy Acts Officer, U.S. 
Secret Service, oom 720, 1800 G Street, NW., Washington, DC 20223.

    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to records of 
the United States Secret Service will be made by the Deputy Director, 
United States Secret Service. Appeals should be addressed to:

Freedom of Information Appeal, Deputy Director, U.S. Secret Service, 
Room 800, 1800 G Street, NW., Washington, DC 20223.

    5. Delivery of Process. Service of process will be received by the 
United States Secret Service Chief Counsel at the following address:

Chief Counsel, U.S. Secret Service, Room 842, 1800 G Street, NW., 
Washington, DC 20223.

   Appendix E to Subpart A of Part 1--Bureau of Alcohol, Tobacco and 
                                Firearms

    1. In general. This appendix applies to the Bureau of Alcohol, 
Tobacco and Firearms.
    2. Public reading room. The Bureau of Alcohol, Tobacco and Firearms 
will make materials available for review on an ad hoc basis when 
necessary. Contact the Chief, Disclosure Division, Bureau of Alcohol, 
Tobacco, and Firearms, 650 Massachusetts Avenue, NW., Washington, DC 
20226.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of the Bureau of Alcohol, 
Tobacco, and Firearms will be made by the Chief, Disclosure Division, 
Office of Assistant Director (Liaison and Public Information) or the 
delegate of such officer. Requests may be mailed or delivered in person 
to:

Freedom of Information Act Request, Chief, Disclosure Division, Bureau 
of Alcohol, Tobacco, and Firearms, 650 Massachusetts Avenue, NW., 
Washington, DC 20226.

    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to records of 
the Bureau of Alcohol, Tobacco and Firearms will be made by the 
Assistant Director, Liaison and Public Information, Bureau of Alcohol, 
Tobacco, and Firearms or the delegate of such officer.
    Appeals may be mailed or delivered in person to:

Freedom of Information Appeal, Assistant Director, Liaison and Public 
Information, Bureau of Alcohol, Tobacco, and Firearms, 650 Massachusetts 
Avenue, NW., Washington, DC 20226.

    5. Delivery of process. Service of process will be received by the 
Director of the Bureau of Alcohol, Tobacco, and Firearms at the 
following location:

Bureau of Alcohol, Tobacco, and Firearms, 650 Massachusetts Avenue, NW., 
Washington, DC 20226, Attention: Chief Counsel.

   Appendix F to Subpart A of Part 1--Bureau of Engraving and Printing

    1. In general. This appendix applies to the Bureau of Engraving and 
Printing.
    2. Public reading room. Contact the Disclosure Officer, 14th and C 
Streets, SW., Washington, DC 20228, to make an appointment.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of the Bureau of Engraving 
and Printing will be made by the Assistant to the Director. Requests may 
be mailed or delivered in person to:

Freedom of Information Act Request, Disclosure Officer, (Assistant to 
the Director),

[[Page 30]]

Room 112-M, Bureau of Engraving and Printing, Washington, DC 20228.

    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to records of 
the Bureau of Engraving and Printing will be made by the Director of the 
Bureau of Engraving and Printing or the delegate of the Director. 
Appeals may be mailed or delivered in person to:

Freedom of Information Appeal, Director, Bureau of Engraving and 
Printing, 14th and C Streets, SW., Room 119-M, Washington, DC 20228.

    5. Delivery of process. Service of process will be received by the 
Chief Counsel or the delegate of such officer at the following location:

Chief Counsel, Bureau of Engraving and Printing, 14th and C Streets, 
SW., Room 04-24 M, Washington, DC 20228.

     Appendix G to Subpart A of Part 1--Financial Management Service

    1. In general. This appendix applies to the Financial Management 
Service.
    2. Public reading room. The public reading room for the Financial 
Management Service is maintained at the following location:

Library, Main Treasury Building, 1500 Pennsylvania Avenue NW., 
Washington, DC 20220.

    For building security purposes, visitors are required to make an 
appointment by calling 202/622-0990.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
whether to grant requests for records will be made by the Disclosure 
Officer, Financial Management Service. Requests may be mailed or 
delivered in person to:

Freedom of Information Request, Disclosure Officer, Financial Management 
Service, 401 14th Street, SW., Washington, DC 20227.

    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) will be made by the 
Commissioner, Financial Management Service. Appeals may be mailed to:

Freedom of Information Appeal (FOIA), Commissioner, Financial Management 
Service, 401 14th Street, SW., Washington, DC 20227.

    Appeals may be delivered personally to the Office of the 
Commissioner, Financial Management Service, 401 14th Street, SW., 
Washington, DC.
    5. Delivery of process. Service of process will be received by the 
Commissioner, Financial Management Service, and shall be delivered to:

Commissioner, Financial Management Service, Department of the Treasury, 
401 14th Street, SW., Washington, DC 20227.

          Appendix H to Subpart A of Part 1--United States Mint

    1. In general. This appendix applies to the United States Mint.
    2. Public reading room. The U.S. Mint will provide a room on an ad 
hoc basis when necessary. Contact the Freedom of Information/Privacy Act 
Officer, United States Mint, Judiciary Square Building, 7th floor, 633 
3rd Street, NW., Washington, DC 20220.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of the United States Mint 
will be made by the Freedom of Information/Privacy Act Officer, United 
States Mint. Requests may be mailed or delivered in person to:

Freedom of Information Act Request, Freedom of Information/Privacy Act 
Officer, United States Mint, Judiciary Square Building, 7th Floor, 633 
3rd Street, NW., Washington, DC 20220.

    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to records of 
the United States Mint will be made by the Director of the Mint. Appeals 
made by mail should be addressed to:

Freedom of Information Appeal, Director, United States Mint, Judiciary 
Square Building, 7th Floor, 633 3rd Street, NW., Washington, DC 20220.

    5. Delivery of process. Service of process will be received by the 
Director of the Mint and shall be delivered to:

Chief Counsel, United States Mint, Judiciary Square Building, 7th Floor, 
633 3rd Street, NW., Washington, D.C. 20220.

      Appendix I to Subpart A of Part 1--Bureau of the Public Debt

    1. In general. This appendix applies to the Bureau of the Public 
Debt.
    2. Public reading room. The public reading room for the Bureau of 
the Public Debt is maintained at the following location:

Library, Main Treasury Building, 1500 Pennsylvania Avenue, NW, 
Washington, DC 20220.

    For building security purposes, visitors are required to make an 
appointment by calling 202/622-0990.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
whether to grant requests for records will be made by the Disclosure 
Officer of the Bureau of the Public Debt. Requests may be sent to:

    Freedom of Information Act Request, Disclosure Officer, 
Administrative Resource Center, Bureau of the Public Debt, Department of 
the Treasury, 200 Third Street, Room 211, Parkersburg, WV 26101-5312.


[[Page 31]]


    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to records of 
the Bureau of the Public Debt will be made by the Executive Director, 
Administrative Resource Center, Bureau of the Public Debt. Appeals may 
be sent to:

Freedom of Information Act Appeal, Executive Director, Administrative 
Resource Center, Bureau of the Public Debt, Department of the Treasury, 
200 Third Street, Room 211, Parkersburg, WV 26101-5312.

    5. Delivery of process. Service of process will be received by the 
Chief Counsel, Bureau of the Public Debt, or the delegate of such 
officer, and shall be delivered to the following location:

Chief Counsel's Office, Bureau of the Public Debt, 200 Third Street, 
Room G-15, Parkersburg, WV 26106-1328.

[65 FR 40504, June 30, 2000, as amended at 67 FR 34402, May 14, 2002]

  Appendix J to Subpart A of Part 1--Office of the Comptroller of the 
                                Currency

    1. In general. This appendix applies to the Office of the 
Comptroller of the Currency.
    2. Public reading room. The Office of the Comptroller of the 
Currency will make materials available through its Public Information 
Room at 250 E Street, SW., Washington, DC 20219.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of the Office of the 
Comptroller of the Currency will be made by the Disclosure Officer or 
the official so designated. Requests may be mailed or delivered in 
person to:

Freedom of Information Act Request, Disclosure Officer, Communications 
Division, 3rd Floor, Comptroller of the Currency, 250 E Street, SW., 
Washington, DC 20219.

    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to records of 
the Office of the Comptroller of the Currency will be made by the Chief 
Counsel or delegates of such person. Appeals made by mail should be 
addressed to:

Communications Division, Comptroller of the Currency, 250 E Street, SW., 
Washington, DC 20219.

    Appeals may be delivered personally to the Communications Division, 
Comptroller of the Currency, 250 E Street, SW., Washington, DC.
    5. Delivery of process. Service of process will be received by the 
Director, Litigation Division, Comptroller of the Currency, and shall be 
delivered to such officer at the following location:

Litigation Division, Comptroller of the Currency, 250 E Street, SW., 
Washington, DC 20219.

  Appendix K to Subpart A of Part 1--Federal Law Enforcement Training 
                                 Center

    1. In general. This apppendix applies to the Federal Law Enforcement 
Training Center.
    2. Public reading room. The public reading room for the Federal Law 
Enforcement Training Center is maintained at the following location:

Library, Building 262, Federal Law Enforcement Training Center, Glynco, 
GA 31524.

    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records will be made by the Chief, 
Management Analysis Division, Federal Law Enforcement Training Center. 
Requests made by mail should be addressed to:

Freedom of Information Act Request, Freedom of Information Act Officer, 
Federal Law Enforcement Training Center, Department of the Treasury, 
Building 94, Glynco, GA 31524.

    Requests may be delivered personally to the Management Analysis 
Division, Federal Law Enforcement Training Center, Building 94, Glynco, 
GA.
    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to records of 
the consolidated Federal Law Enforcement Training Center will be made by 
the Director, Federal Law Enforcement Training Center. Appeals may be 
mailed to:

Freedom of Information Appeal, Federal Law Enforcement Training Center, 
Department of the Treasury, Building 94, Glynco, GA 31524.

    5. Delivery of process. Service of process will be received by the 
Legal Counsel of the Federal Law Enforcement Training Center, or his 
delegate, and shall be delivered to such officer at the following 
location:

Legal Counsel, Federal Law Enforcement Training Center, Department of 
the Treasury, Building 94, Glynco, GA 31524.

     Appendix L to Subpart A of Part 1--Office of Thrift Supervision

    1. In general. This appendix applies to the Office of Thrift 
Supervision (OTS). OTS regulatory handbooks and other publications are 
available for sale. Information may be obtained by calling the OTS Order 
Department at 301/645-6264. OTS regulatory handbooks and other 
publications may be purchased by forwarding a request, along with a 
check to: OTS Order Department, PO Box

[[Page 32]]

753, Waldorf, MD 20604 or by calling 301/645-6264 to pay by VISA or 
MASTERCARD.
    2. Public reading room. The public reading room for the Office of 
Thrift Supervision is maintained at the following location:

1700 G Street, NW., Washington, DC 20552.

    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of the Office of Thrift 
Supervision will be made by the Director, OTS Dissemination Branch. 
Requests for records should be addressed to: Freedom of Information 
Request, Manager, Dissemination Branch, Records Management & Information 
Policy Division, Office of Thrift Supervision, 1700 G Street, NW., 
Washington, DC 20552.
    Requests for records may be delivered in person to:

Public Reference Room, Office of Thrift Supervision, 1700 G Street, NW., 
Washington, DC.

    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to records of 
the Office of Thrift Supervision will be made by the Director, Records 
Management & Information Policy, Office of Thrift Supervision, or their 
designee. Appeals made by mail should be addressed to: Freedom of 
Information Appeal, Director, Records Management & Information Policy 
Division, Office of Thrift Supervision, 1700 G Street, NW., Washington, 
DC 20552.
    Appeals may be delivered in person to:

Public Reference Room, Office of Thrift Supervision, 1700 G Street, NW., 
Washington, DC.

    5. Delivery of process. Service of process will be received by the 
Corporate Secretary of the Office of Thrift Supervision or their 
designee and shall be delivered to the following location:

Corporate Secretary, Office of Thrift Supervision, 1700 G Street, NW., 
Washington, DC 20552.

      Appendix M to Subpart A--Financial Crimes Enforcement Network

    1. In general. This appendix applies to the Financial Crimes 
Enforcement Network (FinCEN).
    2. Public Reading Room. FinCEN will provide a room on an ad hoc 
basis when necessary. Contact Office of Regulatory Programs, FinCEN, 
(202) 354-6400.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of FinCEN will be made by 
the Freedom of Information Act/Privacy Act Officer, FinCEN. Requests for 
records may be mailed to: Freedom of Information Act/Privacy Act 
Request, Financial Crimes Enforcement Network, Post Office Box 39, 
Vienna, VA 22183.
    4. Administrative appeal of initial determinations to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to the records 
of FinCEN will be made by the Director of FinCEN or the delegate of the 
Director. Appeals should be mailed to: Freedom of Information Appeal, 
Post Office Box 39, Vienna, VA 22183.
    5. Delivery of process. Service of process will be received by the 
Chief Counsel of FinCEN and shall be delivered to: Chief Counsel, 
Financial Crimes Enforcement Network, Post Office Box 39, Vienna, VA 
22183.

[68 FR 55310, Sept. 25, 2003]



                  Subpart B_Other Disclosure Provisions



Sec. 1.8  Scope.

    The regulations in this subpart concern access to information and 
records other than under 5 U.S.C. 552. This subpart is applicable to the 
Departmental Offices and to the bureaus of the Department as defined in 
Sec. 1.1(a) of this part, except to the extent that bureaus of the 
Department have adopted separate guidance governing the subject matter 
of a provision of this subpart.

[69 FR 54003, Sept. 7, 2004]



Sec. 1.9  Records not to be otherwise withdrawn or disclosed.

    Except in accordance with this part, or as otherwise authorized, 
Treasury Department officers and employees are prohibited from making 
records or duplicates available to any person who is not an officer or 
employee of the Department, and are prohibited from withdrawing any such 
records or duplicates from the files, possession or control of the 
Department.

[69 FR 54003, Sept. 7, 2004]



Sec. 1.10  Oral information.

    (a) Officers and employees of the Department may, in response to 
requests, orally provide information contained in records of the 
Department that are determined to be available to the public. If the 
obtaining of such information requires a search of records, a written 
request and the payment of the fee for a record search set forth in 
Sec. 1.6 will be required.

[[Page 33]]

    (b) Information with respect to activities of the Department not a 
matter of record shall not be disclosed if the information involves 
matters exempt from disclosure under 5 U.S.C. 552 or the regulations in 
this part, or if the disclosure of such information would give the 
person requesting the information advantages not accorded to other 
citizens.

[69 FR 54003, Sept. 7, 2004]



Sec. 1.11  Testimony or the production of records in a court or other 
proceeding.

    (a) Applicability. (1) This section sets forth the policies and 
procedures of the Department regarding the testimony of employees and 
former employees as witnesses in legal proceedings and the production or 
disclosure of information contained in Department documents for use in 
legal proceedings pursuant to a request, order, or subpoena 
(collectively referred to in this subpart as a demand).
    (2) This section does not apply to any legal proceeding in which an 
employee is to testify while on leave status regarding facts or events 
that are unrelated to the official business of the Department.
    (3)(i) Nothing in this section affects the rights and procedures 
governing public access to records pursuant to the Freedom of 
Information Act (5 U.S.C. 552) or the Privacy Act (5 U.S.C. 552a).
    (ii) Demands in legal proceedings for the production of records, or 
for the testimony of Department employees regarding information 
protected by the Privacy Act (5 U.S.C. 552a), the Trade Secrets Act (18 
U.S.C. 1905) or other confidentiality statutes, must satisfy the 
requirements for disclosure set forth in those statutes and the 
applicable regulations of this part before the records may be provided 
or testimony given.
    (4) This section is intended only to provide guidance for the 
internal operations of the Department and to inform the public about 
Department procedures concerning the service of process and responses to 
demands or requests, and the procedures specified in this section, or 
the failure of any Treasury employee to follow the procedures specified 
in this section, are not intended to, do not, and may not be relied upon 
to create a right or benefit, substantive or procedural, enforceable at 
law by a party against the United States.
    (b) Definitions. For purposes of this section:
    (1) Agency counsel means:
    (i) With respect to the Departmental Offices, the General Counsel or 
his or her designee; or
    (ii) With respect to a bureau or office of the Department, the Chief 
Counsel or Legal Counsel (or his or her designee) of such bureau or 
office.
    (2) Demand means a request, order, or subpoena for testimony or 
documents related to or for possible use in a legal proceeding.
    (3) Department means the United States Department of the Treasury.
    (4) Document means any record or other property, no matter what 
media and including copies thereof, held by the Department, including 
without limitation, official letters, telegrams, memoranda, reports, 
studies, calendar and diary entries, maps, graphs, pamphlets, notes, 
charts, tabulations, analyses, statistical or informational 
accumulations, any kind of summaries of meetings and conversations, film 
impressions, magnetic tapes and sound or mechanical reproductions.
    (5) Employee means all employees or officers of the Department, 
including contractors and any other individuals who have been appointed 
by, or are subject to the supervision, jurisdiction or control of the 
Secretary, as well as the Secretary of the Treasury. The procedures 
established within this subpart also apply to former employees of the 
Department where specifically noted.
    (6) General Counsel means the General Counsel of the Department or 
other Department employee to whom the General Counsel has delegated 
authority to act under this subpart.
    (7) Legal proceeding means all pretrial, trial and post trial stages 
of all existing or reasonably anticipated judicial or administrative 
actions, hearings, investigations, or similar proceedings before courts, 
commissions, boards, grand juries, or other tribunals, foreign or 
domestic. This phrase includes all phases of discovery as well as

[[Page 34]]

responses to formal or informal requests by attorneys or others involved 
in legal proceedings.
    (8) Official business means the authorized business of the 
Department.
    (9) Secretary means the Secretary of the Treasury.
    (10) Testimony means a statement in any form, including personal 
appearances before a court or other legal tribunal, interviews, 
depositions, telephonic, televised, or videotaped statements or any 
responses given during discovery or similar proceedings, which response 
would involve more than the production of documents.
    (c) Department policy. No current or former employee shall, in 
response to a demand, produce any Department documents, provide 
testimony regarding any information relating to or based upon Department 
documents, or disclose any information or produce materials acquired as 
part of the performance of that employee's official duties or official 
status, without the prior authorization of the General Counsel or the 
appropriate agency counsel.
    (d) Procedures for demand for testimony or production of documents. 
(1) A demand directed to the Department for the testimony of a 
Department employee or for the production of documents shall be served 
in accordance with the Federal Rules of Civil Procedure, Federal Rules 
of Criminal Procedure, or applicable state procedures and shall be 
directed to the General Counsel, Department of the Treasury, 1500 
Pennsylvania Avenue, NW., Washington, DC 20220, or to the Chief or Legal 
Counsel of the concerned Department component. Acceptance of a demand 
shall not constitute an admission or waiver with respect to 
jurisdiction, propriety of service, improper venue, or any other defense 
in law or equity available under the applicable laws or rules.
    (2) A subpoena or other demand for testimony directed to an employee 
or former employee shall be served in accordance with the Federal Rules 
of Civil or Criminal Procedure or applicable State procedure and a copy 
of the subpoena shall be sent to agency counsel.
    (3)(i) In court cases in which the United States or the Department 
is not a party, where the giving of testimony or the production of 
documents by the Department, or a current or former employee is desired, 
an affidavit (or if that is not feasible, a statement) by the litigant 
or the litigant's attorney, setting forth the information with respect 
to which the testimony or production is desired, must be submitted in 
order to obtain a decision concerning whether such testimony or 
production will be authorized. Such information shall include: the title 
of the legal proceeding, the forum, the requesting party's interest in 
the legal proceeding, the reason for the demand, a showing that other 
evidence reasonably suited to the requester's needs is not available 
from any other source and, if testimony is requested, the intended use 
of the testimony, a general summary of the desired testimony, and a 
showing that no document could be provided and used in lieu of 
testimony. The purpose of this requirement is to assist agency counsel 
in making an informed decision regarding whether testimony or the 
production of document should be authorized. Permission to testify or 
produce documents will, in all cases, be limited to the information set 
forth in the affidavit or statement, or to such portions thereof as may 
be deemed proper.
    (ii) Agency counsel may consult or negotiate with an attorney for a 
party, or the party if not represented by an attorney, to refine or 
limit a demand so that compliance is less burdensome or obtain 
information necessary to make the determination required by paragraph 
(e) of this section. Failure of the attorney or party to cooperate in 
good faith to enable agency counsel to make an informed determination 
under this subpart may serve, where appropriate, as a basis for a 
determination not to comply with the demand.
    (iii) A determination under this subpart to comply or not to comply 
with a demand is without prejudice as to any formal assertion or waiver 
of privilege, lack of relevance, technical deficiency or any other 
ground for noncompliance.
    (4)(i) Employees shall immediately refer all inquiries and demands 
made on the Department to agency counsel.

[[Page 35]]

    (ii) An employee who receives a subpoena shall immediately forward 
the subpoena to agency counsel. Agency counsel will determine the manner 
in which to respond to the subpoena.
    (e) Factors to be considered by agency counsel. (1) In deciding 
whether to authorize the release of official information or the 
testimony of personnel concerning official information (hereafter 
referred to as ``the disclosure'') agency counsel shall consider the 
following factors:
    (i) Whether the request or demand is unduly burdensome;
    (ii) Whether the request would involve the Department in 
controversial issues unrelated to the Department's mission;
    (iii) Whether the time and money of the United States would be used 
for private purposes;
    (iv) The extent to which the time of employees for conducting 
official business would be compromised;
    (v) Whether the public might misconstrue variances between personal 
opinions of employees and Department policy;
    (vi) Whether the request demonstrates that the information requested 
is relevant and material to the action pending, genuinely necessary to 
the proceeding, unavailable from other sources, and reasonable in its 
scope;
    (vii) Whether the number of similar requests would have a cumulative 
effect on the expenditure of agency resources;
    (viii) Whether disclosure otherwise would be inappropriate under the 
circumstances; and
    (ix) Any other factor that is appropriate.
    (2) Among those demands and requests in response to which compliance 
will not ordinarily be authorized are those with respect to which any of 
the following factors exists:
    (i) The disclosure would violate a statute, Executive order, or 
regulation;
    (ii) The integrity of the administrative and deliberative processes 
of the Department would be compromised;
    (iii) The disclosure would not be appropriate under the rules of 
procedure governing the case or matter in which the demand arose;
    (iv) The disclosure, including release in camera, is not appropriate 
or necessary under the relevant substantive law concerning privilege;
    (v) The disclosure, except when in camera and necessary to assert a 
claim of privilege, would reveal information properly classified or 
other matters exempt from unrestricted disclosure; or
    (vi) The disclosure would interfere with ongoing enforcement 
proceedings, compromise constitutional rights, reveal the identity of an 
intelligence source or confidential informant, or disclose trade secrets 
or similarly confidential commercial or financial information.
    (f) Requests for opinion or expert testimony. (1) Subject to 5 CFR 
2635.805, an employee or former employee shall not provide, with or 
without compensation, opinion or expert testimony concerning official 
information, subjects, or activities, except on behalf of the United 
States or a party represented by the Department of Justice, without 
written approval of agency counsel.
    (2) Upon a showing by the requestor of exceptional need or unique 
circumstances and that the anticipated testimony will not be adverse to 
the interests of the Department or the United States, agency counsel 
may, in writing, grant authorization for an employee, or former 
employee, to appear and testify at no expense to the United States.
    (3) Any expert or opinion testimony by a former employee of the 
Department shall be excepted from Sec. 1.11(f)(1) where the testimony 
involves only general expertise gained while employed at the Department.
    (g) Procedures when agency counsel directs an employee not to 
testify or provide documents. (1) If agency counsel determines that an 
employee or former employee should not comply with a subpoena or other 
request for testimony or the production of documents, agency counsel 
will so inform the employee and the party who submitted the subpoena or 
made the request.
    (2) If, despite the determination of the agency counsel that 
testimony should not be given and/or documents not be produced, a court 
of competent jurisdiction or other appropriate authority orders the 
employee or former

[[Page 36]]

employee to testify and/or produce documents, the employee shall notify 
agency counsel of such order.
    (i) If agency counsel determines that no further legal review of, or 
challenge to, the order will be sought, the employee or former employee 
shall comply with the order.
    (ii) If agency counsel determines to challenge the order, or that 
further legal review is necessary, the employee or former employee 
should not comply with the order. Where necessary, the employee should 
appear at the time and place set forth in the subpoena. If legal counsel 
cannot appear on behalf of the employee, the employee should produce a 
copy of this subpart and respectfully inform the legal tribunal that he/
she has been advised by counsel not to provide the requested testimony 
and/or produce documents. If the legal tribunal rules that the subpoena 
must be complied with, the employee shall respectfully decline to 
comply, citing this section and United States ex rel. Touhy v. Ragen, 
340 U.S. 462 (1951).

[69 FR 54003, Sept. 7, 2004]



Sec. 1.12  Regulations not applicable to official request.

    The regulations in this part shall not be applicable to official 
requests of other governmental agencies or officers thereof acting in 
their official capacities, unless it appears that granting a particular 
request would be in violation of law or inimical to the public interest. 
Cases of doubt should be referred for decision to agency counsel (as 
defined in Sec. 1.11(b)(1)).

[69 FR 54003, Sept. 7, 2004]



                          Subpart C_Privacy Act



Sec. 1.20  Purpose and scope of regulations.

    The regulations in this subpart are issued to implement the 
provisions of the Privacy Act of 1974 (5 U.S.C. 552a). The regulations 
apply to all records which are contained in systems of records 
maintained by the Department of the Treasury and which are retrieved by 
an individual's name or personal identifier. They do not relate to those 
personnel records of Government employees, which are under the 
jurisdiction of the Office of Personnel Management to the extent such 
records are subject to regulations issued by such OPM. The regulations 
apply to all components of the Department of the Treasury. Any reference 
in this subpart to the Department or its officials, employees, or 
records shall be deemed to refer also to the components or their 
officials, employees, or records. The regulations set forth the 
requirements applicable to Department of the Treasury employees 
maintaining, collecting, using or disseminating records pertaining to 
individuals. They also set forth the procedures by which individuals may 
request notification of whether the Department of the Treasury maintains 
or has disclosed a record pertaining to them or may seek access to such 
records maintained in any nonexempt system of records, request 
correction of such records, appeal any initial adverse determination of 
any request for amendment, or may seek an accounting of disclosures of 
such records. For the convenience of interested persons, the components 
of the Department of the Treasury may reprint these regulations in their 
entirety (less any appendices not applicable to the component in 
question) in those titles of the Code of Federal Regulations which 
normally contain regulations applicable to such components. In 
connection with such republication, and at other appropriate times, 
components may issue supplementary regulations applicable only to the 
component in question, which are consistent with these regulations. In 
the event of any actual or apparent inconsistency, these Departmental 
regulations shall govern. Persons interested in the records of a 
particular component should, therefore, also consult the Code of Federal 
Regulations for any rules or regulations promulgated specifically with 
respect to that component (see Appendices to this subpart for cross 
references). The head of each component is hereby also authorized to 
substitute other appropriate officials for those designated and correct 
addresses specified in the appendix to this subpart applicable to the 
component. The components of the Department of the Treasury for the 
purposes of this subpart are:

[[Page 37]]

    (a) The Departmental Offices, which include the offices of:
    (1) The Secretary of the Treasury, including immediate staff;
    (2) The Deputy Secretary of the Treasury, including immediate staff;
    (3) The Chief of Staff, including immediate staff;
    (4) The Executive Secretary and all offices reporting to such 
official, including immediate staff;
    (5) The Under Secretary of the Treasury for International Affairs 
and all offices reporting to such official, including immediate staff;
    (6) The Under Secretary of the Treasury for Domestic Finance and all 
offices reporting to such official, including immediate staff;
    (7) The Under Secretary for Enforcement and all offices reporting to 
such official, including immediate staff;
    (8) The Assistant Secretary of the Treasury for Financial 
Institutions and all offices reporting to such official, including 
immediate staff;
    (9) The Assistant Secretary of the Treasury for Economic Policy and 
all offices reporting to such official, including immediate staff;
    (10) The Fiscal Assistant Secretary and all offices reporting to 
such official, including immediate staff;
    (11) The General Counsel and all offices reporting to such official, 
including immediate staff; except legal counsel to the components listed 
in paragraphs (a)(17) and (b) through (m) of this section;
    (12) The Inspector General and all offices reporting to such 
official, including immediate staff;
    (13) The Assistant Secretary of the Treasury for International 
Affairs and all offices reporting to such official, including immediate 
staff;
    (14) The Assistant Secretary of the Treasury for Legislative Affairs 
and Public Liaison and all offices reporting to such official, including 
immediate staff;
    (15) The Assistant Secretary of the Treasury for Management and 
Chief Financial Officer and all offices reporting to such official, 
including immediate staff;
    (16) The Assistant Secretary of the Treasury for Public Affairs and 
all offices reporting to such official, including immediate staff;
    (17) The Assistant Secretary of the Treasury for Tax Policy and all 
offices reporting to such official, including immediate staff;
    (18) The Treasurer of the United States, including immediate staff;
    (19) The Treasury Inspector General for Tax Administration and all 
offices reporting to such official, including immediate staff.
    (b) The Bureau of Alcohol, Tobacco and Firearms.
    (c) The Office of the Comptroller of the Currency.
    (d) The United States Customs Service.
    (e) The Bureau of Engraving and Printing.
    (f) The Federal Law Enforcement Training Center.
    (g) The Financial Management Service.
    (h) The Internal Revenue Service.
    (i) The United States Mint.
    (j) The Bureau of the Public Debt.
    (k) The United States Secret Service.
    (l) The Office of Thrift Supervision.
    (m) The Financial Crimes Enforcement Network.

For purposes of this subpart, the office of the legal counsel for the 
components listed in paragraphs (b), (c), (d), (e), (f), (g), (h), (i), 
(j), (k), (l), and (m) of this section are to be considered a part of 
such components. Any office, which is now in existence or may hereafter 
be established, which is not specifically listed or known to be a 
component of any of those listed above, shall be deemed a part of the 
Departmental Offices for the purpose of these regulations.

[52 FR 26305, July 14, 1987, as amended at 60 FR 31633, June 16, 1995; 
65 FR 2333, Jan. 14, 2000; 68 FR 55311, Sept. 25, 2003]



Sec. 1.21  Definitions.

    (a) The term agency means agency as defined in 5 U.S.C. 552(e);
    (b) The term individual means a citizen of the United States or an 
alien lawfully admitted for permanent residence;
    (c) The term maintain includes maintain, collect, use, or 
disseminate;
    (d) The term record means any item, collection, or grouping of 
information

[[Page 38]]

about an individual that is maintained by the Department of the Treasury 
or component of the Department. This includes, but is not limited to, 
the individual's education, financial transactions, medical history, and 
criminal or employment history and that contains the name, or an 
identifying number, symbol, or other identifying particular assigned to 
the individual, such as a finger or voice print or a photograph;
    (e) The term system of records means a group of any records under 
the control of the Department of the Treasury or any component from 
which information is retrieved by the name of the individual or by some 
identifying number, symbol, or other identifying particular assigned to 
the individual;
    (f) The term statistical record means a record in a system of 
records maintained for statistical research or reporting purposes only 
and not used in whole or part in making any determination about an 
identifiable individual, except as provided by 13 U.S.C. 8.
    (g) The term routine use means the disclosure of a record that is 
compatible with the purpose for which the record was collected;
    (h) The term component means a bureau or office of the Department of 
the Treasury as set forth in Sec. 1.20 and in the appendices to these 
regulations. (See 5 U.S.C. 552a(a).)
    (i) The term request for access means a request made pursuant to 5 
U.S.C. 552a(d)(1).
    (j) The term request for amendment means a request made pursuant to 
5 U.S.C. 552a(d)(2).
    (k) The term request for accounting means a request made pursuant to 
5 U.S.C. 552a(c)(3).



Sec. 1.22  Requirements relating to systems of records.

    (a) In general. Subject to 5 U.S.C. 552a (j) and (k) and Sec. 
1.23(c), each component shall, in conformance with 5 U.S.C. 552a:
    (1) Maintain in its records only such information about an 
individual as is relevant and necessary to accomplish a purpose of the 
agency required to be accomplished by the statute or by Executive order 
of the President (See 5 U.S.C. 552a(e)(1)).
    (2) Collect information to the greatest extent practicable directly 
from the subject individual when the information may result in adverse 
determinations about an individual's rights, benefits, and privileges 
under Federal programs. (See 5 U.S.C. 552a(e)(2)).
    (b) Requests for information from individuals. Subject to 5 U.S.C. 
552a(j) and Sec. 1.23(c)(1), each component of the Treasury shall 
inform each individual whom it asks to supply information, on the form 
which it uses to collect the information or on a separate form that can 
be retained by the individual:
    (1) The authority (whether granted by statute, or by Executive order 
of the President) which authorizes the solicitation of the information 
and whether disclosure of such information is mandatory or voluntary;
    (2) The principal purpose or purposes for which the information is 
intended to be used;
    (3) The routine uses which may be made of the information, as 
published pursuant to 5 U.S.C. 552a(e)(4)(D); and
    (4) The effects on such individual, if any, of not providing all or 
any part of the requested information. (See 5 U.S.C. 552a(e)(3)).
    (c) Report on new systems. Each component of the Treasury shall 
provide adequate advance notice to Congress and the Office of Management 
and Budget through the Disclosure Branch and Administration Section of 
the Office of the General Counsel of any proposal to establish or alter 
any system of records in order to permit an evaluation of the probable 
or potential effect of such proposal on the privacy and other personal 
or property rights of individuals or the disclosure of information 
relating to such individuals, and its effect on the preservation of the 
constitutional principles of federalism and separation of powers. (See 5 
U.S.C. 552a(o)).
    (d) Accurate and secure maintenance of records. Each component 
shall:
    (1) Subject to 5 U.S.C. 552a(j) and Sec. 1.23(c)(1), maintain all 
records which are used in making any determination about any individual 
with such accuracy, relevance, timeliness, and completeness as is 
reasonably necessary to

[[Page 39]]

assure fairness to the individual in the determination (see 5 U.S.C. 
552a(e)(5);
    (2) Prior to disseminating any record about an individual to any 
person other than an agency, unless the dissemination is made pursuant 
to 5 U.S.C. 552 (see 31 CFR part 1, subpart A), make reasonable efforts 
to assure that such records are accurate, complete, timely, and relevant 
for Department of the Treasury purposes (see 5 U.S.C. 552a(e)(6)) and
    (3) Establish appropriate administrative, technical, and physical 
safeguards to insure the security and confidentiality of records and to 
protect against any anticipated threats or hazards to their security or 
integrity which could result in substantial harm, embarrassment, 
inconvenience, or unfairness to any individual on whom information is 
maintained. (See 5 U.S.C. 552a(e)(10)).
    (i) System managers, with the approval of the head of their offices 
within a component, shall establish administrative and physical 
controls, consistent with Department regulations, to insure the 
protection of records systems from unauthorized access or disclosure and 
from physical damage or destruction. The controls instituted shall be 
proportional to the degree of sensitivity of the records but at a 
minimum must insure that records other than those available to the 
general public under the Freedom of Information Act (5 U.S.C. 552), are 
protected from public view, that the area in which the records are 
stored is supervised during all business hours and physically secure 
during nonbusiness hours to prevent unauthorized personnel from 
obtaining access to the records. Automated systems shall comply with the 
security standards promulgated by the National Bureau of Standards.
    (ii) System managers, with the approval of the head of their offices 
within a component, shall adopt access restrictions to insure that only 
those individuals within the agency who have a need to have access to 
the records for the performance of their duties have access to them. 
Procedures shall also be adopted to prevent accidental access to, or 
dissemination of, records.
    (e) Prohibition against maintenance of records concerning First 
Amendment rights. No component shall maintain a record describing how 
any individual exercises rights guaranteed by the First Amendment (e.g. 
speech), unless the maintenance of such record is:
    (1) Expressly authorized by statute, or
    (2) Expressly authorized by the individual about whom the record is 
maintained, or
    (3) Pertinent to and within the scope of an authorized law 
enforcement activity. (See 5 U.S.C. 552a (e)(7))
    (f) Notification of disclosure under compulsory legal process. 
Subject to 5 U.S.C. 552a(j) and Sec. 1.23(c)(1), when records 
concerning an individual are subpoenaed by a Grand Jury, Court, or 
quasi-judicial agency, or disclosed in accordance with an ex parte court 
order pursuant to 26 U.S.C. 6103(i), the official served with the 
subpoena or court order shall make reasonable efforts to assure that 
notice of any disclosure is provided to the individual. Notice shall be 
provided within five working days of making the records available under 
compulsory legal process or, in the case of a Grand Jury subpoena or an 
ex parte order, within five days of its becoming a matter of public 
record. Notice shall be mailed to the last known address of the 
individual and shall contain the following information: the date and 
authority to which the subpoena is, or was returnable, or the date of 
and court issuing the ex parte order, the name and number of the case or 
proceeding, and the nature of the information sought and provided. 
Notice of the issuance of a subpoena or an ex parte order is not 
required if the system of records has been exempted from the notice 
requirement of 5 U.S.C. 552a (e)(8) and this section, pursuant to 5 
U.S.C. 552a (j) and Sec. 1.23 (c)(1), by a Notice of Exemption 
published in the Federal Register. (See 5 U.S.C. 552a (e)(8)).
    (g) Emergency disclosure. If information concerning an individual 
has been disclosed to any person under compelling circumstances 
affecting health or safety, the individual shall be notified at the last 
known address within 5 days of the disclosure (excluding Saturdays, 
Sundays, and legal public holidays).

[[Page 40]]

Notification shall include the following information: The nature of the 
information disclosed, the person or agency to whom it was disclosed, 
the date of disclosure, and the compelling circumstances justifying the 
disclosure. Notification shall be given by the officer who made or 
authorized the disclosure. (See 5 U.S.C. 552a (b)(8)).



Sec. 1.23  Publication in the Federal Register--Notices of systems of 
records, general exemptions, specific exemptions, review of all systems.

    (a) Notices of systems of records to be published in the Federal 
Register. (1) The Department shall publish a notice of the existence and 
character of all systems of records every 3 years in the Federal 
Register. An annual notice of systems of records is required to be 
published by the Office of the Federal Register in the publication 
entitled ``Privacy Act Issuances'', as specified in 5 U.S.C. 552a(f).
    (2) Minor changes to systems of records shall be published annually. 
(See paragraph (d)(8) of this section)
    (3) In addition, the Department shall publish in the Federal 
Register upon establishment or revision a notice of the existence and 
character of any new or revised systems of records. Unless otherwise 
instructed, each notice shall include:
    (i) The name and location of the system;
    (ii) The categories of individuals on whom records are maintained in 
the system;
    (iii) The categories of records maintained in the system;
    (iv) Each routine use of the records contained in the system, 
including the categories of users and the purpose of such use;
    (v) The policies and practices of the component regarding storage, 
retrievability, access controls, retention, and disposal of the records;
    (vi) The title and business address of the Treasury official who is 
responsible for the system of records;
    (vii) The procedures of the component whereby an individual can be 
notified if the system of records contain a record pertaining to the 
individual, including reasonable times, places, and identification 
requirements.
    (viii) The procedures of the component whereby an individual can be 
notified on how to gain access to any record pertaining to such 
individual that may be contained in the system of records, and how to 
contest its content; and
    (ix) The categories of sources of records in the system. (See 5 
U.S.C. 552a(e)(4))
    (b) Notice of new or modified routine uses to be published in the 
Federal Register. At least 30 days prior to a new use or modification of 
a routine use, as published under paragraph (a)(3)(iv) of this section, 
each component shall publish in the Federal Register notice of such new 
or modified use of the information in the system and provide an 
opportunity for interested persons to submit written data, views, or 
arguments to the components. (See 5 U.S.C. 552a(e)(11))
    (c) Promulgation of rules exempting systems from certain 
requirements--(1) General exemptions. In accordance with existing 
procedures applicable to a Treasury component's issuance of regulations, 
the head of each such component may adopt rules, in accordance with the 
requirements (including general notice) of 5 U.S.C. 553 (b) (1), (2), 
and (3), (c) and (e), to exempt any system of records within the 
component from any part of 5 U.S.C. 552a and these regulations except 
subsections (b) (sec. 1.24, conditions of disclosure), (c)(1) (sec. 
1.25, keep accurate accounting of disclosures), (c)(2) (sec. 1.25, 
retain accounting for five years or life of record), (e)(4) (A) through 
(F) (paragraph (a) of this section, publication of annual notice of 
systems of records), (e)(6) (sec. 1.22(d), accuracy of records prior to 
dissemination), (e)(7) (sec. 1.22(e), maintenance of records on First 
Amendment rights), (e)(9) (sec. 1.28, establish rules of conduct), 
(e)(10) (sec. 1.22(d)(3), establish safeguards for records), (e)(11) 
(paragraph (c) of this section, publish new intended use), and (i) (sec. 
1.28(c), criminal penalties) if the systems of records maintained by the 
component which performs as its principal function any activity 
pertaining to the enforcement of criminal laws, including police efforts 
to prevent, control, or reduce crime or to apprehend criminals, and the 
activities of

[[Page 41]]

prosecutors, courts, correctional, probation, pardon, or parole 
authorities, and which consists of:
    (i) Information compiled for the purpose of identifying individual 
criminal offenders and alleged offenders and consisting only of 
identifying data and notations of arrests, the nature and disposition of 
criminal charges, sentencing, confinement, release, and parole, and 
probation status;
    (ii) Information compiled for the purpose of a criminal 
investigation, including reports of informants and investigators, and 
associated with an identifiable individual; or
    (iii) Reports identifiable to an individual compiled at any stage of 
the process of enforcement of the criminal laws from arrest or 
indictment through release from supervision. (See 5 U.S.C. 552a(j))
    (2) Specific exemptions. In accordance with existing procedures 
applicable to a Treasury component's issuance of regulations, the head 
of each such component may adopt rules, in accordance with the 
requirements (including general notice) of 5 U.S.C. 553 (b) (1), (2), 
and (3), (c), and (e), to exempt any system of records within the 
component from 5 U.S.C. 552a(c)(3) (sec. 1.25(c)(2), accounting of 
certain disclosures available to the individual), (d) (sec. 1.26(a), 
access to records), (e)(1) (sec. 1.22(a)(1), maintenance of information 
to accomplish purposes authorized by statute or executive order only), 
(e)(4)(G) (paragraph (a)(7) of this section, publication of procedures 
for notification), (e)(4)(H) (paragraph (a)(8) of this section, 
publication of procedures for access and contest), (e)(4)(I) (paragraph 
(a)(9) of this section, publication of sources of records), and (f) 
(sec. 1.26, promulgate rules for notification, access and contest), if 
the system of records is:
    (i) Subject to the provisions of 5 U.S.C. 552(b)(1);
    (ii) Investigatory material compiled for law enforcement purposes, 
other than material within the scope of subsection (j)(2) of 5 U.S.C. 
552a and paragraph (a)(1) of this section. If any individual is denied 
any right, privilege, or benefit that such individual would otherwise be 
entitled to by Federal law, or for which such individual would otherwise 
be eligible, as a result of the maintenance of this material, such 
material shall be provided to the individual, except to the extent that 
the disclosure of the material would reveal the identity of a source who 
furnished information to the Government under an express promise that 
the identity of the source would be held in confidence, or prior to 
September 27, 1975, under an implied promise that the identity of the 
source would be held in confidence;
    (iii) Maintained in connection with providing protective services to 
the President of the United States or other individuals pursuant to 18 
U.S.C. 3056;
    (iv) Required by statute to be maintained and used solely as 
statistical records;
    (v) Investigatory material compiled solely for the purpose of 
determining suitability, eligibility, or qualifications for Federal 
civilian employment, military service, Federal contracts, or access to 
classified information, but only to the extent that the disclosure of 
such material would reveal the identity of a source who furnished 
information to the Government under an express promise that the identity 
of the source would be held in confidence, or, prior to September 27, 
1975, under an implied promise that the identity of the source would be 
held in confidence;
    (vi) Testing or examination material used solely to determine 
individual qualifications for appointment or promotion in the Federal 
service the disclosure of which would compromise the objectivity or 
fairness of the testing or examination process; or
    (vii) Evaluation material used to determine potential for promotion 
in the armed services, but only to the extent that the disclosure of 
such material would reveal the identity of a source who furnished 
information to the Government under an express promise that the identity 
of the source would be held in confidence, or, prior to September 27, 
1975, under an implied promise that the identity of the source would be 
held in confidence.
    (3) At the time that rules under this subsection are adopted, the 
head of the component shall include in the statement required under 5 
U.S.C. 553(c) the reasons why the system of records is to be exempted 
from a provision of 5

[[Page 42]]

U.S.C. 552a and this part. (See 5 U.S.C. 552a (j) and (k))
    (d) Review and report to OMB. The Department shall ensure that the 
following reviews are conducted as often as specified below by each of 
the components who shall be prepared to report to the Departmental 
Disclosure Branch upon request the results of such reviews and any 
corrective action taken to resolve problems uncovered. Each component 
shall:
    (1) Review every two years a random sample of the component's 
contracts that provide for the maintenance of a system of records on 
behalf of the component to accomplish a function of the component, in 
order to ensure that the working of each contract makes the provisions 
of the Act apply. (5 U.S.C. 552a(m)(1))
    (2) Review annually component's recordkeeping and disposal policies 
and practices in order to assure compliance with the Act.
    (3) Review routine use disclosures every 3 years, that are 
associated with each system of records in order to ensure that the 
recipient's use of such records continues to be compatible with the 
purpose for which the disclosing agency originally collected the 
information.
    (4) Review every three years each system of records for which the 
component has issued exemption rules pursuant to section (j) or (k) of 
the Privacy Act in order to determine whether the exemption is needed.
    (5) Review annually each ongoing matching program in which the 
component has participated during the year, either as a source or as a 
matching agency in order to assure that the requirements of the Act, the 
OMB Matching Guidelines, and the OMB Model Control System and checklist 
have been met.
    (6) Review component's training practices annually to ensure that 
all component personnel are familiar with the requirements of the Act, 
these regulations and Departmental directives.
    (7) Review annually the actions of component personnel that have 
resulted either in the agency being found civilly liable under section 
(g) of the Act, or an employee being found criminally liable under the 
provisions of section (i) of the Act, in order to determine the extent 
of the problem and to prevent future recurrences.
    (8) Review annually each system of records notice to ensure that it 
accurately describes the system. Where minor changes are needed, publish 
an amended notice in the Federal Register. Minor changes shall be 
consolidated in one annual comprehensive publication. The term ``minor 
change to a system of records'' means a change that does not 
significantly change the system. More specifically, a minor change does 
not affect the character or purpose of the system and does not affect 
the ability of an individual to gain access to a record about the 
individual or to any information pertaining to such individual which is 
contained in the system; for example, changing the title of the system 
manager or the location of the system.



Sec. 1.24  Disclosure of records to person other than the individual 
to whom they pertain.

    (a) Conditions of disclosure. No component of Treasury shall 
disclose any record which is contained in a system of records maintained 
by it by any means of communication to any person, or to another agency, 
except pursuant to a written request by, or with the prior written 
consent of, the individual to whom the record pertains, or the parent, 
if a minor, or legal guardian, if incompetent, of such individual, 
unless disclosure of the record would be:
    (1) To those offices and employees of the Department of the Treasury 
who have a need for the record in the performance of their duties;
    (2) Retired under 5 U.S.C. 552 (subpart A of this part);
    (3) For a routine use as defined in 5 U.S.C. 552a(a)(7) and Sec. 
1.21(g) and as described under 5 U.S.C. 552a(e)(4)(D) and Sec. 
1.23(a)(4);
    (4) To the Bureau of the Census for purposes of planning or carrying 
out a census or survey or related activity pursuant to the provisions of 
title 13 of the U.S. Code;
    (5) To a recipient who has provided the component with advance 
adequate written assurance that the record will be used solely as a 
statistical research

[[Page 43]]

or reporting record, and the record is to be transferred in a form that 
is not individually identifiable;
    (6) To the National Archives of the United States as a record which 
has sufficient historical or other value to warrant its continued 
preservation by the United States Government, or for evaluation by the 
Administrator of General Services or the designee of such official to 
determine whether the record has such value;
    (7) To another agency or to an instrumentality of any governmental 
jurisdiction within or under the control of the United States for a 
civil or criminal law enforcement activity.
    (i) If the activity is authorized by law; and
    (ii) If the head of the agency or instrumentality has made a written 
request to the Department of the Treasury specifying the particular 
portion desired and the law enforcement activities for which the record 
is sought;
    (8) To a person pursuant to a showing of compelling circumstances 
affecting the health or safety of an individual, if upon such 
disclosure, notification is transmitted to the last known address of 
such individual;
    (9) To either House of Congress, or, to the extent of matter within 
its jurisdiction, any committee or subcommittee thereof, any joint 
committee of Congress or subcommittee of any such joint committee.
    (10) To the Comptroller General, or the authorized representatives 
of such official, in the course of the performance of the duties of the 
General Accounting Office; or
    (11) Pursuant to the order of a court of competent jurisdiction. 
(See 5 U.S.C. 552a(b))



Sec. 1.25  Accounting of disclosures.

    (a) Accounting of certain disclosures. Each component, with respect 
to each system of records under its control, shall:
    (1) Keep an accurate accounting of: (i) The date, nature, and 
purpose of each disclosure of a record to any person or to an agency 
made under 5 U.S.C. 552a (b) and Sec. 1.24; and (ii) the name and 
address of the person or agency to whom the disclosure is made;
    (2) Retain the accounting made under paragraph (a)(1) of this 
section for at least five years or the life of the record, whichever is 
longer, after the disclosure for which the accounting is made; and
    (3) Inform any person or other agency about any correction or 
notation of dispute made by the constitutent unit in accordance with 5 
U.S.C. 552a (d) and Sec. 1.28 of any record that has been disclosed to 
the person or agency if an accounting of the disclosure was made. (See 5 
U.S.C. 552(c).)
    (b) Accounting systems. To permit the accounting required by 
paragraph (a) of this section, system managers, with the approval of the 
head of their offices within a component, shall establish or implement, 
a system of accounting for all disclosures of records, either orally or 
in writing, made outside the Department of the Treasury. Accounting 
records shall:
    (1) Be established in the least expensive and most convenient form 
that will permit the system manager to advise individuals, promptly upon 
request, what records concerning them have been disclosed and to whom:
    (2) Provide, as a minimum, the identification of the particular 
record disclosed, the name and address of the person or agency to whom 
or to whom or to which disclosed, and the date, nature and purpose of 
the disclosure; and
    (3) Be maintained for 5 years or until the record is destroyed or 
transferred to the National Archives and Records Service for storage in 
records centers, in which event, the accounting pertaining to those 
records, unless maintained separately, shall be transferred with the 
records themselves.
    (c) Exemptions from accounting requirements. No accounting is 
required for disclosure of records:
    (1) To those officers and employees of the Department of the 
Treasury who have a need for the record in the performance of their 
duties; or
    (2) If disclosure would be required under 5 U.S.C. 552 and Subpart A 
of this part.
    (d) Access to accounting by individual. (1) Subject to paragraphs 
(c) and (d)(2) of this section, each component shall establish and set 
forth in the appendix

[[Page 44]]

to this subpart applicable to the component, procedures for making the 
accounting required under paragraph (a) of this section available to the 
individual to whom the record pertains and shall thereafter make such 
accounting available in accordance therewith at the request of the 
individual. The procedures may require the requester to provide 
reasonable identification.
    (2) Access accountings of disclosure may be withheld from the 
individual named in the record only if the disclosures were (i) made 
under 5 U.S.C. 552a (b)(7) and Sec. 1.24 (a)(7), or (ii) under a system 
of records exempted from the requirements of 5 U.S.C. 552a(c)(3) in 
accordance with 5 U.S.C. 552 (j) or (k) and Sec. 1.23(c). (See 5 U.S.C. 
552a(c))



Sec. 1.26  Procedures for notification and access to records pertaining 
to individuals--format and fees for request for access.

    (a) Procedures for notification and access. Each component shall 
establish, in accordance with the requirements of 5 U.S.C. 553, and set 
forth in the appendix to this subpart applicable to such component 
procedures whereby an individual can be notified, in response to a 
request, if any system of records named by the individual contains a 
record pertaining to that individual. In addition, such procedures shall 
set forth the requirements for access to such records. As a minimum such 
procedures shall specify the times during, and the places at which 
access will be accorded, together with such identification as may be 
required of the individual before access. (See 5 U.S.C. 552a(f) (1), (2) 
and (3))
    (b) Access. Each component in accordance with the procedures 
prescribed under paragraph (a) of this section, shall allow an 
individual to gain access to records or to any information pertaining to 
such individual which is contained in the system of records upon 
request. The individual shall be permitted to review the record and have 
a copy made of all or any portion of the record in a form that is 
comprehensible. The individual will also be permitted to be accompanied 
by any person of the individual's choosing to review the record, except 
that the agency may require the individual to furnish a written 
statement authorizing discussion of that individual's record in the 
accompanying person's presence. (See 5 U.S.C. 552a(d)(1))
    (c) Exceptions. Neither the procedures prescribed under paragraph 
(a) of this section nor the requirements for access under paragraph (b) 
of this section shall be applicable to--(1) systems of records exempted 
pursuant to 5 U.S.C. 552a (j) and (k) and Sec. 1.23(c); (2) information 
compiled in reasonable anticipation of a civil action or proceeding (See 
5 U.S.C. 552(d)(5)); or (3) information pertaining to an individual 
which is contained in, and inseparable from, another individual's 
record.
    (d) Format of request. (1) A record for notification of whether a 
record exists shall:
    (i) Be made in writing and signed by the person making the request, 
who must be the individual about whom the record is maintained, or such 
individual's duly authorized representative (See Sec. 1.34);
    (ii) State that it is made pursuant to the Privacy Act, 5 U.S.C. 
552a or these regulations, have marked ``Privacy Act Request'' on the 
request and on the envelope;
    (iii) Give the name of the system or subsystem or categories of 
records to which access is sought, as specified in ``Privacy Act 
Issuances'' published by the Office of the Federal Register and 
referenced in the appendices to this subpart;
    (iv) Describe the nature of the record(s) sought in sufficient 
detail to enable Department personnel to locate the system of records 
containing the record with a reasonable amount of effort. Whenever 
possible, a request for access should describe the nature of the record 
sought, the date of the record or the period in which the record was 
compiled.
    (v) Provide such identification of the requester as may be specified 
in the appropriate appendix to this subpart; and
    (vi) Be addressed or delivered in person to the office or officer of 
the component indicated for the particular system or subsystem or 
categories of records the individual wishes access to, as specified in 
``Privacy Act Issuances'' published by the Office of the Federal

[[Page 45]]

Register and referenced in the appendices to this subpart. Assistance in 
ascertaining the appropriate component or in preparing a request for 
notification may be obtained by a written request to this effect 
addressed as specified in Appendix A of this part, as the address for 
the Departmental Offices for ``Request for notification and access to 
records and accountings of disclosures''.
    (2) A request for access to records shall, in addition to complying 
with paragraph (a)(1)(i) through (vi) of this section:
    (i) State whether the requester wishes to inspect the records or 
desires to have a copy made and furnished without first inspecting them;
    (ii) If the requester desires to have a copy made, state the firm 
agreement of the requester to pay the fees for duplication ultimately 
determined in accordance with (31 CFR 1.6) Subpart A of this title, 
unless such fees are waived pursuant to that section by the system 
manager or other appropriate official as indicated in the appropriate 
appendix to these regulations; and
    (iii) Comply with any other requirement set forth in the applicable 
appendix to this subpart or the ``Notice of Records Systems'' applicable 
to the system in question. Requesters are hereby advised that any 
request for access which does not comply with the foregoing requirements 
and those set forth elsewhere in this Subpart C, will not be deemed 
subject to the time constraints of this section, unless and until 
amended so as to comply. However, components shall advise the requester 
in what respect the request is deficient so that it may be processed. 
This section applies only to records which are contained in a system of 
records and which are in the possession or control of the component. 
(See 5 U.S.C. 552a (d) and (f))
    (e) Requests for records not in control of component. (1) Treasury 
employees shall make reasonable efforts to assist an oral requester to 
ascertain to which office or officer a written request should be sent. 
When the request is for a record which is not in the possession or 
control of any component of the Department of the Treasury, the 
requester shall be so advised.
    (2) Where the record requested was created by a Department or agency 
other than the Department of the Treasury or a component of the 
Department and has been classified (e.g. National Defense or 
Intelligence Information) or otherwise restrictively endorsed (e.g. 
Office of Personnel Management records of FBI reports) by such other 
Department or agency, and a copy is in the possession of a component of 
the Department of the Treasury, that portion of the request shall be 
referred to the originating agency for determination as to all issues in 
accordance with the Privacy Act. In the case of a referral to another 
agency under this paragraph, the requester shall be notified that such 
portion of the request has been so referred and that the requester may 
expect to hear from that agency.
    (3) When information sought from a system manager or other 
appropriate official in the Department of the Treasury includes 
information furnished by other Federal agencies not classified or 
otherwise restrictively endorsed, the system manager or other 
appropriate official receiving the request shall consult with the 
appropriate agency prior to making a decision to disclose or not to 
disclose the record. The decision as to whether the record shall be 
disclosed shall be made, in the first instance by the system manager or 
other appropriate official maintaining the record. (See 5 U.S.C. 552a 
(d) and (f))
    (f) Date of receipt of request. A request for notification or access 
to records shall be considered to have been received for purposes of 
this subpart on the date on which the requirements of paragraph (d) of 
this section have been satisfied. Requests for notification or access to 
records and any separate agreement to pay shall be stamped or endorsed 
with the date of receipt by the receiving office. The latest of such 
stamped dates will be deemed to be the date of receipt of the request 
for the purposes of this subpart. (See 5 U.S.C. 552a (d) and (f))
    (g) Notification of determination--(1) In general. Notification of 
determinations as to notification of whether a record exists or as to 
whether to grant access to records requested will be made by

[[Page 46]]

the officers designated in the appendices to this subpart. The 
notification of the determination shall be mailed within 30 days 
(excluding Saturdays, Sundays and legal public holidays) after the date 
of receipt of the request, as determined in accordance with paragraph 
(f) of this section. If it is not possible to respond within 30 days, 
the designated officer shall inform the requester, stating the reason 
for the delay (e.g. volume of records requested, scattered location of 
the records, need to consult other agencies, or the difficulty of the 
legal issues involved) and when a response will be dispatched. (See 5 
U.S.C. 552a (d) and (f))
    (2) Granting of access. When it has been determined that the request 
for access will be granted--(i) and a copy requested; such copy in a 
form comprehensible to the requester shall be furnished promptly, 
together with a statement of the applicable fees for duplication; and 
(ii) and the right to inspect has been requested, the requester shall be 
promptly notified in writing of the determination, and when and where 
the requested records may be inspected. An individual seeking to inspect 
such records may be accompanied by another person of such individual's 
choosing. The individual seeking access shall be required to sign the 
required form indicating that the Department of the Treasury is 
authorized to discuss the contents of the subject record in the 
accompanying person's presence. If, after making the inspection, the 
individual making the request desires a copy of all or a portion of the 
requested records, such copy in a form comprehensible to the individual 
shall be furnished upon payment of the applicable fees for duplication. 
Fees to be charged are as prescribed by 31 CFR part 1, Subpart A, Sec. 
1.6 Fees shall not be charged where they would amount, in the aggregate, 
to less than $3.00. (See 5 U.S.C. 552a (d) and (f))
    (3) Requirements for access to medical records. When access is 
requested to medical records, including psychological records, the 
responsible official may determine that such release could have an 
adverse effect on the individual and that release will be made only to a 
physician authorized in writing to have access to such records by the 
individual making the request. Upon receipt of the authorization the 
physician will be permitted to review the records or to receive copies 
of the records by mail, upon proper verification of identity. (See 5 
U.S.C. 552a (f) (3))
    (4) Denial of request. When it is determined that the request for 
notification of whether a record exists or access to records will be 
denied (whether in whole or part or subject to conditions or 
exceptions), the person making the request shall be so notified by mail 
in accordance with paragraph (g)(1) of this section. The letter of 
notification shall specify the city or other location where the 
requested records are situated (if known), contain a statement of the 
reasons for not granting the request as made, set forth the name and 
title or position of the responsible official and advise the individual 
making the request of the right to file suit in accordance with 5 U.S.C. 
552a (g)(1)(B).
    (5) Prohibition against the use of 5 U.S.C. 552 (b) exemptions. 
Exemptions from disclosure under 5 U.S.C. 552 (b) (31 CFR part 1, 
Subpart A, Sec. 1.2 (c)), may not be invoked for the purpose of 
withholding from an individual any record which is otherwise accessible 
to such individual under the Privacy Act, 5 U.S.C. 552a and this 
subpart. (See 5 U.S.C. 552a (q))
    (6) Records exempt in whole or in part. (i) When an individual 
requests notification as to whether a record exists or access to records 
concerning the individual which have been exempted from individual 
access pursuant to 5 U.S.C. 552a (j) or which have been compiled in 
reasonable anticipation of a civil action or proceeding in either a 
court or before an administrative tribunal and the assertion of the 
exemption is deemed necessary, the Department of the Treasury will 
neither confirm nor deny the existence of the record but shall advise 
the individual only that no record available to the individual pursuant 
to the Privacy Act of 1974 has been identified.
    (ii) Requests from individuals for access to records which have been 
exempted from access pursuant to 5 U.S.C. 552a (k) shall be processed as 
follows:

[[Page 47]]

    (A) Requests for information classified pursuant to Executive Order 
11652 require the responsible component of the Department to review the 
information to determine whether it continues to warrant classification 
under the criteria of sections 1 and 5 (B), (C), (D) and (E) of the 
Executive order. Information which no longer warrants classification 
under these criteria shall be declassified and made available to the 
individual. If the information continues to warrant classification, the 
individual shall be advised that the information sought is classified, 
that it has been reviewed and continues to warrant classification, and 
that it has been exempted from access pursuant to 5 U.S.C. 552 (b)(1) 
and 5 U.S.C. 552a (k)(1). Information which has been exempted pursuant 
to 5 U.S.C. 552a (j) and which is also classified shall be reviewed as 
required by this paragraph but the response to the individual shall be 
in the form prescribed by paragraph (g)(6)(i) of this section.
    (B) Requests for information which has been exempted from disclosure 
pursuant to 5 U.S.C. 552a (k)(2) shall be responded to in the manner 
provided in paragraph (g)(6)(i) of this section unless the requester 
shows that the information has been used or is being used to deny the 
individual any right, privilege or benefit for which he is eligible or 
to which he would otherwise be entitled under federal law. In that 
event, the individual shall be advised of the existence of the 
information but such information as would identify a confidential source 
shall be extracted or summarized in a manner which protects the source 
to the maximum degree possible and the summary extract shall be provided 
to the requesting individual.
    (C) Information compiled as part of an employee background 
investigation which has been exempted pursuant to 5 U.S.C. 552a (k)(5) 
shall be made available to an individual upon request except to the 
extent that it identifies the confidential source. Material identifying 
the confidential sources shall be extracted or summarized in a manner 
which protects the source to the maximum degree possible and the summary 
or extract shall be provided to the requesting individual.
    (D) Testing or examination material which has been exempted pursuant 
to 5 U.S.C. 552a (k)(6) shall not be made available to an individual if 
disclosure would compromise the objectivity or fairness of the testing 
or examination process; but may be made available if no such compromise 
possibility exists. (See 5 U.S.C. 552a (d)(5), (j) and (k)).



Sec. 1.27  Procedures for amendment of records pertaining to 

individuals--format, agency review and appeal from initial 
adverse agency determination.

    (a) In general. Subject to the application of exemptions promulgated 
by the head of each component, in accordance with Sec. 1.23(c), and 
subject to Sec. 1.27(f), each component of the Department of the 
Treasury, shall in conformance with 5 U.S.C. 552a(d)(2), permit an 
individual to request amendment of a record pertaining to such 
individual. Any request for amendment of records or any appeal that does 
not fully comply with the requirements of this section and any 
additional specific requirements imposed by the component in the 
applicable appendix to this subpart will not be deemed subject to the 
time constraints of paragraph (e) of this section, unless and until 
amended so as to comply. However, components shall advise the requester 
in what respect the request or appeal is deficient so that it may be 
resubmitted or amended. (See 5 U.S.C. 552a (d) and (f))
    (b) Form of request to amend records. In order to be subject to the 
provisions of this section, a request to amend records shall:
    (1) Be made in writing and signed by the person making the request, 
who must be the individual about whom the record is maintained, or the 
duly authorized representative of such individual;
    (2) State that it is made pursuant to the Privacy Act, 5 U.S.C. 552a 
or these regulations, have marked ``Privacy Act Amendment Request'' on 
the request and on the envelope;
    (3) Be addressed to the office or officer of the component specified 
for such purposes in ``Privacy Act Issuances'' published by the Office 
of the Federal Register and referenced in the appendices to this subpart 
for that purpose; and

[[Page 48]]

    (4) Reasonably describe the records which the individual desires to 
have amended, including, to the best of the requester's knowledge, dates 
of letters requesting access to such records previously and dates of 
letters in which notification concerning access was made, if any, and 
the individual's documentation justifying the correction. (See U.S.C. 
552a (d) and (f))
    (c) Date of receipt of request. A request for amendment of records 
pertaining to an individual shall be deemed to have been received for 
purposes of this subpart when the requirements of paragraph (b) of this 
section have been satisfied. The receiving office or officer shall stamp 
or otherwise endorse the date of receipt of the request. (See 5 U.S.C. 
552a (d) and (f))
    (d) Review of requests to amend records. Officials responsible for 
review of requests to amend records pertaining to an individual, as 
specified in the appropriate appendix to this subpart, shall:
    (1) Not later than 10 days (excluding Saturdays, Sundays, and legal 
public holidays) after the date of receipt of such request, acknowledge 
in writing such receipt; and
    (2) Promptly, either--(i) Make any correction of any portion which 
the individual believes and the official agrees is not accurate, 
relevant, timely, or complete; or
    (ii) Inform the individual of the refusal to amend the record in 
accordance with the individual's request, the reason for the refusal, 
and the name and business address of the officer designated in the 
applicable appendix to this subpart, as the person who is to review such 
refusal. (See 5 U.S.C. 552a (d) and (f))
    (e) Administrative appeal--(1) In general. Each component shall 
permit individuals to request a review of initial decisions made under 
paragraph (d) of this section, when an individual disagrees with a 
refusal to amend this record. (See 5 U.S.C. 552a (d), (f), and (g)(1))
    (2) Form of request for administrative review of refusal to amend 
record. At any time within 35 days after the date of the notification of 
the initial decision described in paragraph (d)(2)(ii) of this section, 
the requester may submit an administrative appeal from such refusal to 
the official specified in the notification of the initial decision and 
the appropriate appendix to this subpart. The appeal shall:
    (i) Be made in writing stating any arguments in support thereof and 
be signed by the person to whom the record pertains, or the duly 
authorized representative of such official;
    (ii) Be addressed to and mailed or hand delivered within 35 days of 
the date of the initial decision, to the office or officer specified in 
the appropriate appendix to this subpart and in the notification. (See 
the appendices to this subpart for the address to which appeals made by 
mail should be addressed);
    (iii) Have clearly marked on the appeal and on the envelope, 
``Privacy Act Amendment Appeal'';
    (iv) Reasonably describe the records requested to be amended; and
    (v) Specify the date of the initial request, to amend records, and 
the date of the letter giving notification that the request was denied. 
(See 5 U.S.C. 552a (d) and (f))
    (3) Date of receipt. Appeals shall be promptly stamped with the date 
of their receipt by the office to which addressed and such stamped date 
will be deemed to be the date of receipt for all purposes of this 
subpart. The receipt of the appeal shall be acknowledged within 10 days 
(excluding Saturdays, Sundays, and legal public holidays) from the date 
of the receipt (unless the determination on appeal is dispatched in 10 
days, in which case, no acknowledgement is required) by the responsible 
official and the requester advised of the date of receipt established by 
the foregoing and when a response is due in accordance with this 
paragraph. (See 5 U.S.C. 552a (d) and (f))
    (4) Review of administrative appeals from denial of requests to 
amend records. Officials responsible for deciding administrative appeals 
from denials of requests to amend records pertaining to an individual, 
as specified in the appendices to this subpart shall: Complete the 
review, and notify the requester of the final agency decision within 30 
days (exclusive of Saturdays, Sundays and legal public holidays) after 
the date of receipt of such appeal, unless the time is extended by the 
head of the

[[Page 49]]

agency or the delegate of such official, for good cause shown. If such 
final agency decision is to refuse to amend the record, in whole or in 
part, the requester shall also be advised of the right--(i) to file a 
concise ``Statement of Disagreement'' setting forth the reasons for his 
disagreement with the decision which shall be filed within 35 days of 
the date of the notification of the final agency decision and (ii) to 
judicial review of the final agency decision under 5 U.S.C. 
552a(g)(1)(A). (See 5 U.S.C. 552a (d), (f) and (g)(1))
    (5) Notation on record and distribution of statements of 
disagreement. The system manager is responsible, in any disclosure 
containing information about which an individual has filed a ``Statement 
of Disagreement'', occurring after the filing of the statement under 
paragraph (e)(4) of this section, for clearly noting any portion of the 
record which is disputed and providing copies of the statement and, if 
deemed appropriate, a concise statement of the component's reasons for 
not making the amendments requested to persons or other agencies to whom 
the disputed record has been disclosed. (See 5 U.S.C. 552a(d)(4))
    (f) Records not subject to correction under the Privacy Act. The 
following records are not subject to correction or amendment by 
individuals:
    (1) Transcripts or written statements made under oath; and
    (2) Transcripts of Grand Jury proceedings, judicial or quasi-
judicial proceedings which form the official record of those 
proceedings; and
    (3) Pre-sentence reports comprising the property of the courts but 
maintained in agency files; and
    (4) Records pertaining to the determination, the collection and the 
payment of the Federal taxes; and
    (5) Records duly exempted from correction by notice published in the 
Federal Register; and
    (6) Records compiled in reasonable anticipation of a civil action or 
proceeding.



Sec. 1.28  Training, rules of conduct, penalties for non-compliance.

    (a) Training. Subject to policy guidance and regulations issued by 
the Deputy Secretary, who has Departmentwide responsibility therefor, 
each component shall institute a training program to instruct employees 
and employees of Government contractors covered by 5 U.S.C. 552a(m), who 
are involved in the design, development, operation or maintenance of any 
system of records, on a continuing basis with respect to the duties and 
responsibilities imposed on them and the rights conferred on individuals 
by the Privacy Act, the regulations in this subpart, including the 
appendices thereto, and any other related regulations. Such training 
shall provide suitable emphasis on the civil and criminal penalties 
imposed on the Department and the individual employees by the Privacy 
Act for non-compliance with specified requirements of the Act as 
implemented by the regulations in this subpart. (See 5 U.S.C. 
552a(e)(9))
    (b) Rules of conduct. In addition, to the Standards of Conduct 
published in part O of this title, particularly 31 CFR 0.735-44, the 
following are applicable to employees of the Department of the Treasury 
(including, to the extent required by the contract or 5 U.S.C. 552a(m), 
Government contractors and employees of such contractors), who are 
involved in the design, development, operation or maintenance of any 
system of records, or in maintaining any records, for or on behalf of 
the Department, including any component thereof.
    (1) The head of each office of a component of the Department shall 
be responsible for assuring that employees subject to such official's 
supervision are advised of the provisions of the Privacy Act, including 
the criminal penalties and civil liabilities provided therein, and the 
regulations in this subpart, and that such employees are made aware of 
their individual and collective responsibilities to protect the security 
of personal information, to assure its accuracy, relevance, timeliness 
and completeness, to avoid unauthorized disclosure either orally or in 
writing, and to insure that no information system concerning 
individuals, no matter how small or specialized is maintained without 
public notice.
    (2) Employees of the Department of the Treasury involved in the 
design,

[[Page 50]]

development, operation, or maintenance of any system of records, or in 
maintaining any record shall:
    (i) Collect no information of a personal nature from individuals 
unless authorized to collect it to achieve a function or carry out a 
responsibility of the Department;
    (ii) Collect from individuals only that information which is 
necessary to Department functions or responsibilities, unless related to 
a system exempted under 5 U.S.C. 552a (j) or (k):
    (iii) Collect information, wherever possible, directly from the 
individual to whom it relates, unless related to a system exempted under 
5 U.S.C. 552a(j);
    (iv) Inform individuals from whom information is collected about 
themselves of the authority for collection, the purposes thereof, the 
use that will be made of the information, and the effects, both legal 
and practical, of not furnishing the information. (While this provision 
does not explicitly require it, where feasible, third party sources 
should be informed of the purposes for which information they are asked 
to provide will be used.);
    (v) Neither collect, maintain, use nor disseminate information 
concerning an individual's religious or political beliefs or activities 
or membership in associations or organizations, unless (A) the 
individual has volunteered such information for the individual's own 
benefits; (B) the information is expressly authorized by statute to be 
collected, maintained, used or disseminated; or (C) the activities 
involved are pertinent to and within the scope of an authorized 
investigation, adjudication or correctional activity;
    (vi) Advise their supervisors of the existence or contemplated 
development of any record system which is capable of retrieving 
information about individuals by individual identifier;
    (vii) Disseminate no information concerning individuals outside the 
Department except when authorized by 5 U.S.C. 552a or pursuant to a 
routine use published in the Federal Register;
    (viii) Assure that an accounting is kept in the prescribed form, of 
all dissemination of personal information outside the Department, 
whether made orally or in writing, unless disclosed under 5 U.S.C. 552 
and subpart A of this part;
    (ix) Maintain and process information concerning individuals with 
care in order to insure that no inadvertent disclosure of the 
information is made either within or without the Department; and
    (x) Assure that the proper Department authorities are aware of any 
information in a system maintained by the Department which is not 
authorized to be maintained under the provisions of the Privacy Act of 
1974, including information on First Amendment Activities, information 
that is inaccurate, irrelevant or so incomplete as to risk unfairness to 
the individual concerned.
    (3) Heads of components within the Department or their delegates 
shall, at least annually, review the record systems subject to their 
supervision to insure compliance with the provisions of the Privacy Act 
of 1974 and the regulations in this subpart. (See 5 U.S.C. 552a (e)(9), 
(i) and (m))
    (c) Criminal penalties. (1) The Privacy Act imposes criminal 
penalties on the conduct of Government officers or employees as follows: 
Any officer or employee of an agency (which term includes the Department 
of the Treasury):
    (i) Who by virtue of the official's employment or official position, 
has possession of, or access to, agency records which contain 
individually identifiable information the disclosure of which is 
prohibited by this section (5 U.S.C. 552a) or regulations established 
thereunder, and who knowing that disclosure of the specific material is 
so prohibited, willfully discloses the material in any manner to any 
person or agency not entitled to receive it, or
    (ii) Who willfully maintains a system of records without meeting the 
notice requirements of paragraph (e)(4) of this section (5 U.S.C. 
552a)--shall be guilty of a misdemeanor and fined not more than $5,000.
    (2) The Act also imposes a collateral criminal penalty on the 
conduct of any person as follows:

    ``Any person who knowingly and willfully requests or obtains any 
record concerning an

[[Page 51]]

individual from an agency under false pretenses shall be guilty of a 
misdemeanor and fined not more than $5,000.''

    (3) For the purposes of 5 U.S.C. 552a (i), the provisions of 
paragraph (c)(1) of this section are applicable to Government 
contractors and employees of such contractors who by contract, operate 
by or on behalf of the Department of the Treasury a system of records to 
accomplish a Departmental function. Such contractor and employees are 
considered employees of the Department of the Treasury for the purposes 
of 5 U.S.C. 552a(i). (See 5 U.S.C. 552a (i) and (m).)



Sec. 1.29  Records transferred to Federal Records Center or National 
Archives of the United States.

    (a) Records transferred to the Administrator of General Services for 
storage in the Federal Records Center. Records pertaining to an 
identifiable individual which are transferred to the Federal Records 
Center in accordance with 44 U.S.C. 3103 shall, for the purposes of the 
Privacy Act, 5 U.S.C. 552a, be considered to be maintained by the 
component which deposited the record and shall be subject to the 
provisions of the Privacy Act and this subpart. The Administrator of 
General Services shall not disclose such records except to the 
Department of the Treasury or to others under rules consistent with the 
Privacy Act which may be established by the Department of the Treasury 
or a component. If such records are retrieved for the purpose of making 
a determination about an individual, they must be reviewed for accuracy, 
relevance, timeliness, and completeness.
    (b) Records transferred to the National Archives of the United 
States. (1) Records transferred to National Archives prior to September 
27, 1975. Records pertaining to an identifiable individual transferred 
to the National Archives prior to September 27, 1975, as a record which 
has sufficient historical or other value to warrant its continued 
preservation by the United States Government shall be considered to be 
maintained by the National Archives, and
    (i) Shall not be subject to 5 U.S.C. 552a,
    (ii) Except, that a statement describing such records [modeled after 
5 U.S.C. 552a (e)(4) (A) through (G)] shall be published in the Federal 
Register.
    (2) Records transferred to National Archives on or after September 
27, 1975. Records pertaining to an identifiable individual transferred 
to the National Archives as a record which has sufficient historical or 
other value to warrant its continued preservation by the United States 
Government, on or after September 27, 1975, shall be considered to be 
maintained by the National Archives, and
    (i) Shall not be subject to 5 U.S.C. 552a,
    (ii) Except, that a statement describing such records in accordance 
with 5 U.S.C. 552a (e)(4) (A) through (G) shall be published in the 
Federal Register and rules of conduct and training in accordance with 5 
U.S.C. 552 (e) (9) are to be established by the National Archives. (See 
5 U.S.C. 552a (e))



Sec. 1.30  Application to system of records maintained by Government 
contractors.

    When a component contracts for the operation of a system of records, 
to accomplish a Departmental function, the provisions of the Privacy 
Act, 5 U.S.C. 552a, and this subpart shall be applicable to such system. 
The component shall have responsibility for insuring that the contractor 
complies with the contract requirements relating to privacy.



Sec. 1.31  Sale or rental of mailing lists.

    (a) In general. An individual's name and address shall not be sold 
or rented by a component unless such action is specifically authorized 
by law.
    (b) Withholding of names and addresses. This section shall not be 
construed to require the withholding of names and addresses otherwise 
permitted to be made public. (See 5 U.S.C. 552a (n)).



Sec. 1.32  Use and disclosure of social security numbers.

    (a) In general. An individual shall not be denied any right, 
benefit, or privilege provided by law by a component because of such 
individual's refusal to disclose his social security number.
    (b) Exceptions. The provisions of paragraph (a) of this section 
shall not apply with respect to:

[[Page 52]]

    (1) Any disclosure which is required by Federal statute, or
    (2) The disclosure of a social security number to any Federal, 
State, or local agency maintaining a system of records in existence and 
operating before January 1, 1975, if such disclosure was required under 
statute or regulation adopted prior to such date to verify the identity 
of an individual.
    (c) Requests for disclosure of social security number. Any component 
which requests an individual to disclose his or her social security 
account number shall inform that individual whether:
    (1) Disclosure is mandatory or voluntary.
    (2) By what statutory or other authority such number is solicited, 
and
    (3) What uses will be made of it. (See section 7 of the Privacy Act 
of 1974 set forth at 5 U.S.C. 552a, note.)



Sec. 1.34  Guardianship.

    The parent or guardian of a minor or a person judicially determined 
to be incompetent shall, in addition to establishing the identity of the 
minor or other person represented, establish parentage or guardianship 
by furnishing a copy of a birth certificate showing parentage or a court 
order establishing the guardianship and may thereafter, act on behalf of 
such individual. (See 5 U.S.C. 552a (h))



Sec. 1.35  Information forms.

    (a) Review of forms. Except for forms developed and used by 
constituent units, the Deputy Assistant Secretary for Administration 
shall be responsible for reviewing all forms developed and used by the 
Department of the Treasury to collect information from and about 
individuals. The heads of components shall each be responsible for the 
review of forms used by such component to collect information from and 
about individuals.
    (b) Scope of review. The responsible officers shall review each form 
for the purpose of eliminating any requirement for information that is 
not relevant and necessary to carry out an agency function and to 
accomplish the following objectives;
    (1) To insure that no information concerning religion, political 
beliefs or activities, association memberships (other than those 
required for a professional license), or the exercise of First Amendment 
rights is required to be disclosed unless such requirement of disclosure 
is expressly authorized by statute or is pertinent to, and within the 
scope of, any authorized law enforcement activity;
    (2) To insure that the form or a separate form that can be retained 
by the individual makes clear to the individual which information he is 
required by law to disclose and the authority for that requirement and 
which information is voluntary;
    (3) To insure that the form or a separate form that can be retained 
by the individual states clearly the principal purpose or purposes for 
which the information is being collected, and summarizes concisely the 
routine uses that will be made of the information;
    (4) To insure that the form or a separate form that can be retained 
by the individual clearly indicates to the individual the effect in 
terms of rights, benefits or privileges of not providing all or part of 
the requested information; and
    (5) To insure that any form requesting disclosure of a Social 
Security Number, or a separate form that can be retained by the 
individual, clearly advises the individual of the statute or regulation 
requiring disclosure of the number or clearly advises the individual 
that disclosure is voluntary and that no consequence will follow from 
the refusal to disclose it, and the uses that will be made of the number 
whether disclosed mandatorily and voluntarily.
    (c) Revision of forms. Any form which does not meet the objectives 
specified in the Privacy Act and in this section, shall be revised to 
conform thereto. A separate statement may be used in instances when a 
form does not conform. This statement will accompany a form and shall 
include all the information necessary to accomplish the objectives 
specified in the Privacy Act and this section.



Sec. 1.36  Systems exempt in whole or in part from provisions of 
5 U.S.C. 552a and this part.

    (a) In General. In accordance with 5 U.S.C. 552a(j) and (k) and 
Sec. 1.23(c), the

[[Page 53]]

Department of the Treasury hereby exempts the systems of records 
identified below from the following provisions of the Privacy Act for 
the reasons indicated.
    (b) Authority. These rules are promulgated pursuant to the authority 
vested in the Secretary of the Treasury by 5 U.S.C. 552a(j) and (k) and 
pursuant to the authority of Sec. 123(c).
    (c) General exemptions under 5 U.S.C. 552a(j)(2). (1) Under 5 U.S.C. 
552a(j)(2), the head of any agency may promulgate rules to exempt any 
system of records within the agency from certain provisions of the 
Privacy Act of 1974 if the agency or component thereof that maintains 
the system performs as its principal function any activities pertaining 
to the enforcement of criminal laws. Certain components of the 
Department of the Treasury have as their principal function activities 
pertaining to the enforcement of criminal laws and protective service 
activities which are necessary to assure the safety of individuals 
protected by the Department pursuant to the provisions of 18 U.S.C. 
3056. This paragraph applies to the following systems of records 
maintained by the Department of the Treasury:
    (i) Departmental Offices:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
DO .190...................................  Investigation Data
                                             Management System.
DO .303...................................  TIGTA General
                                             Correspondence.
DO .307...................................  TIGTA Employee Relations
                                             Matters, Appeals,
                                             Grievances, and Complaint
                                             Files.
DO .308...................................  TIGTA Data Extracts.
DO .309...................................  TIGTA Chief Counsel Case
                                             Files.
DO .310...................................  TIGTA Chief Counsel
                                             Disclosure Section Records.
DO .311...................................  TIGTA Office of
                                             Investigations Files.
------------------------------------------------------------------------

    (ii) Bureau of Alcohol, Tobacco and Firearms:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
ATF .003..................................  Criminal Investigation
                                             Report System.
------------------------------------------------------------------------

    (iii) Comptroller of the Currency:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
CC .110...................................  Reports of Suspicious
                                             Activities
CC .120...................................  Bank Fraud Information
                                             System
CC .500...................................  Chief Counsel's Management
                                             Information System.
CC .510...................................  Litigation Information
                                             System
------------------------------------------------------------------------

    (iv) U.S. Customs Service:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
CS .053...................................  Confidential Source
                                             Identification File.
CS .127...................................  Internal Affairs Records
                                             System.
CS .129...................................  Investigations Record
                                             System.
CS .171...................................  Pacific Basin Reporting
                                             Network.
CS .213...................................  Seized Assets and Case
                                             Tracking System (SEACATS).
CS .244...................................  Treasury Enforcement
                                             Communications System
                                             (TECS).
CS .270...................................  Background-Record File of
                                             Non-Customs Employees.
CS .285...................................  Automated Index to Central
                                             Enforcement Files.
------------------------------------------------------------------------

    (v) Bureau of Engraving and Printing.
    (vi) Federal Law Enforcement Training Center.
    (vii) Financial Management Service.
    (viii) Internal Revenue Service:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
IRS 34.022................................  National Background
                                             Investigations Center
                                             Management Information
                                             System (NBICMIS).
IRS 46.002................................  Case Management and Time
                                             Reporting System, Criminal
                                             Investigation Division.
IRS 46.003................................  Confidential Informants,
                                             Criminal Investigation
                                             Division.
IRS 46.005................................  Electronic Surveillance
                                             Files, Criminal
                                             Investigation Division.
IRS 46.009................................  Centralized Evaluation and
                                             Processing of Information
                                             Items (CEPIIs), Criminal
                                             Investigation Division.
IRS 46.015................................  Relocated Witnesses,
                                             Criminal Investigation
                                             Division.
IRS 46.016................................  Secret Service Details,
                                             Criminal Investigation
                                             Division.
IRS 46.022................................  Treasury Enforcement
                                             Communications System
                                             (TECS).
IRS 46.050................................  Automated Information
                                             Analysis System.
IRS 90.001................................  Chief Counsel Criminal Tax
                                             Case Files.
------------------------------------------------------------------------

    (ix) U.S. Mint
    (x) Bureau of the Public Debt
    (xi) U.S. Secret Service:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
USSS .003.................................  Criminal Investigation
                                             Information System.
USSS .006.................................  Non-Criminal Investigation
                                             Information System.
USSS .007.................................  Protection Information
                                             System.
------------------------------------------------------------------------

    (xii) Office of Thrift Supervision:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
OTS .001..................................  Confidential Individual
                                             Information System.
OTS .004..................................  Criminal Referral Database
------------------------------------------------------------------------


[[Page 54]]

    (xiii) Financial Crimes Enforcement Network:

------------------------------------------------------------------------
                  Number                           Name of System
------------------------------------------------------------------------
FinCEN .001...............................  FinCEN DataBase.
FinCEN .002...............................  Suspicious Activity
                                             Reporting System.
FinCEN .003...............................  Bank Secrecy Act Reports
                                             System.
------------------------------------------------------------------------

    (2) The Department hereby exempts the systems of records listed in 
paragraphs (c)(1)(i) through (xiii) of this section from the following 
provisions of 5 U.S.C. 552a, pursuant to 5 U.S.C. 552a(j)(2): 5 U.S.C. 
552a(c)(3) and (4), 5 U.S.C. 552a(d)(1), (2), (3), (4), 5 U.S.C. 
552a(e)(1), (2) and (3), 5 U.S.C. 552a(e)(4)(G), (H), and (I), 5 U.S.C. 
552a(e)(5) and (8), 5 U.S.C. 552a(f), and 5 U.S.C. 552a(g).
    (d) Reasons for exemptions under 5 U.S.C. 552a(j)(2). (1) 5 U.S.C. 
552a(e)(4)(G) and (f)(l) enable individuals to inquire whether a system 
of records contains records pertaining to them. Application of these 
provisions to the systems of records would give individuals an 
opportunity to learn whether they have been identified as suspects or 
subjects of investigation. As further described in the following 
paragraph, access to such knowledge would impair the Department's 
ability to carry out its mission, since individuals could:
    (i) Take steps to avoid detection;
    (ii) Inform associates that an investigation is in progress;
    (iii) Learn the nature of the investigation;
    (iv) Learn whether they are only suspects or identified as law 
violators;
    (v) Begin, continue, or resume illegal conduct upon learning that 
they are not identified in the system of records; or
    (vi) Destroy evidence needed to prove the violation.
    (2) 5 U.S.C. 552a(d)(1), (e)(4)(H) and (f)(2), (3) and (5) grant 
individuals access to records pertaining to them. The application of 
these provisions to the systems of records would compromise the 
Department's ability to provide useful tactical and strategic 
information to law enforcement agencies.
    (i) Permitting access to records contained in the systems of records 
would provide individuals with information concerning the nature of any 
current investigations and would enable them to avoid detection or 
apprehension by:
    (A) Discovering the facts that would form the basis for their 
arrest;
    (B) Enabling them to destroy or alter evidence of criminal conduct 
that would form the basis for their arrest; and
    (C) Using knowledge that criminal investigators had reason to 
believe that a crime was about to be committed, to delay the commission 
of the crime or commit it at a location that might not be under 
surveillance.
    (ii) Permitting access to either on-going or closed investigative 
files would also reveal investigative techniques and procedures, the 
knowledge of which could enable individuals planning crimes to structure 
their operations so as to avoid detection or apprehension.
    (iii) Permitting access to investigative files and records could, 
moreover, disclose the identity of confidential sources and informers 
and the nature of the information supplied and thereby endanger the 
physical safety of those sources by exposing them to possible reprisals 
for having provided the information. Confidential sources and informers 
might refuse to provide criminal investigators with valuable information 
unless they believed that their identities would not be revealed through 
disclosure of their names or the nature of the information they 
supplied. Loss of access to such sources would seriously impair the 
Department's ability to carry out its mandate.
    (iv) Furthermore, providing access to records contained in the 
systems of records could reveal the identities of undercover law 
enforcement officers who compiled information regarding the individual's 
criminal activities and thereby endanger the physical safety of those 
undercover officers or their families by exposing them to possible 
reprisals.
    (v) By compromising the law enforcement value of the systems of 
records for the reasons outlined in paragraphs (d)(2)(i) through (iv) of 
this section, permitting access in keeping with these provisions would 
discourage other law enforcement and regulatory agencies, foreign and 
domestic, from

[[Page 55]]

freely sharing information with the Department and thus would restrict 
the Department's access to information necessary to accomplish its 
mission most effectively.
    (vi) Limitation on access to the material contained in the 
protective intelligence files is considered necessary to the 
preservation of the utility of intelligence files and in safeguarding 
those persons the Department is authorized to protect. Access to the 
protective intelligence files could adversely affect the quality of 
information available to the Department; compromise confidential 
sources, hinder the ability of the Department to keep track of persons 
of protective interest; and interfere with the Department's protective 
intelligence activities by individuals gaining access to protective 
intelligence files.
    (vii) Many of the persons on whom records are maintained in the 
protective intelligence suffer from mental aberrations. Knowledge of 
their condition and progress comes from authorities, family members and 
witnesses. Many times this information comes to the Department as a 
result of two party conversations where it would be impossible to hide 
the identity of informants. Sources of information must be developed, 
questions asked and answers recorded. Trust must be extended and 
guarantees of confidentiality and anonymity must be maintained. Allowing 
access to information of this kind to individuals who are the subjects 
of protective interest may well lead to violence directed against an 
informant by a mentally disturbed individual.
    (viii) Finally, the dissemination of certain information that the 
Department may maintain in the systems of records is restricted by law.
    (3) 5 U.S.C. 552a(d)(2), (3) and (4), (e)(4)(H), and (f)(4) permit 
an individual to request amendment of a record pertaining to him or her 
and require the agency either to amend the record, or to note the 
disputed portion of the record and to provide a copy of the individual's 
statement of disagreement with the agency's refusal to amend a record to 
persons or other agencies to whom the record is thereafter disclosed. 
Since these provisions depend on the individual's having access to his 
or her records, and since these rules exempt the systems of records from 
the provisions of 5 U.S.C. 552a relating to access to records, for the 
reasons set out in paragraph (d)(2) of this section, these provisions 
should not apply to the systems of records.
    (4) 5 U.S.C. 552a(c)(3) requires an agency to make accountings of 
disclosures of a record available to the individual named in the record 
upon his or her request. The accountings must state the date, nature, 
and purpose of each disclosure of the record and the name and address of 
the recipient.
    (i) The application of this provision would impair the ability of 
law enforcement agencies outside the Department of the Treasury to make 
effective use of information provided by the Department. Making 
accountings of disclosures available to the subjects of an investigation 
would alert them to the fact that another agency is conducting an 
investigation into their criminal activities and could reveal the 
geographic location of the other agency's investigation, the nature and 
purpose of that investigation, and the dates on which that investigation 
was active. Violators possessing such knowledge would be able to take 
measures to avoid detection or apprehension by altering their 
operations, by transferring their criminal activities to other 
geographical areas, or by destroying or concealing evidence that would 
form the basis for arrest. In the case of a delinquent account, such 
release might enable the subject of the investigation to dissipate 
assets before levy.
    (ii) Moreover, providing accountings to the subjects of 
investigations would alert them to the fact that the Department has 
information regarding their criminal activities and could inform them of 
the general nature of that information. Access to such information could 
reveal the operation of the Department's information-gathering and 
analysis systems and permit violators to take steps to avoid detection 
or apprehension.
    (iii) The release of such information to the subject of a protective 
intelligence file would provide significant information concerning the 
nature of an investigation, and could result in impeding or compromising 
the efforts

[[Page 56]]

of Department personnel to detect persons suspected of criminal 
activities or to collect information necessary for the proper evaluation 
of persons considered to be of protective interest.
    (5) 5 U.S.C. 552(c)(4) requires an agency to inform any person or 
other agency about any correction or notation of dispute that the agency 
made in accordance with 5 U.S.C. 552a(d) to any record that the agency 
disclosed to the person or agency if an accounting of the disclosure was 
made. Since this provision depends on an individual's having access to 
and an opportunity to request amendment of records pertaining to him or 
her, and since these rules exempt the systems of records from the 
provisions of 5 U.S.C. 552a relating to access to and amendment of 
records, for the reasons set out in paragraph (f)(3) of this section, 
this provision should not apply to the systems of records.
    (6) 5 U.S.C. 552a(e)(4)(I) requires an agency to publish a general 
notice listing the categories of sources for information contained in a 
system of records. The application of this provision to the systems of 
records could compromise the Department's ability to provide useful 
information to law enforcement agencies, since revealing sources for the 
information could:
    (i) Disclose investigative techniques and procedures;
    (ii) Result in threats or reprisals against informers by the 
subjects of investigations; and
    (iii) Cause informers to refuse to give full information to criminal 
investigators for fear of having their identities as sources disclosed.
    (7) 5 U.S.C. 552a(e)(1) requires an agency to maintain in its 
records only such information about an individual as is relevant and 
necessary to accomplish a purpose of the agency required to be 
accomplished by statute or executive order. The term ``maintain,'' as 
defined in 5 U.S.C. 552a(a)(3), includes ``collect'' and 
``disseminate.'' The application of this provision to the systems of 
records could impair the Department's ability to collect and disseminate 
valuable law enforcement information.
    (i) At the time that the Department collects information, it often 
lacks sufficient time to determine whether the information is relevant 
and necessary to accomplish a Treasury Department purpose.
    (ii) In many cases, especially in the early stages of investigation, 
it may be impossible to immediately determine whether information 
collected is relevant and necessary, and information that initially 
appears irrelevant and unnecessary often may, upon further evaluation or 
upon collation with information developed subsequently, prove 
particularly relevant to a law enforcement program.
    (iii) Compliance with the records maintenance criteria listed in the 
foregoing provision would require the periodic up-dating of the 
Department's protective intelligence files to insure that the records 
maintained in the system remain timely and complete.
    (iv) Not all violations of law discovered by the Department fall 
within the investigative jurisdiction of the Department of the Treasury. 
To promote effective law enforcement, the Department will have to 
disclose such violations to other law enforcement agencies, including 
State, local and foreign agencies, that have jurisdiction over the 
offenses to which the information relates. Otherwise, the Department 
might be placed in the position of having to ignore information relating 
to violations of law not within the jurisdiction of the Department of 
the Treasury when that information comes to the Department's attention 
during the collation and analysis of information in its records.
    (8) 5 U.S.C. 552a(e)(2) requires an agency to collect information to 
the greatest extent practicable directly from the subject individual 
when the information may result in adverse determinations about an 
individual's rights, benefits, and privileges under Federal programs. 
The application of this provision to the systems of records would impair 
the Department's ability to collate, analyze, and disseminate 
investigative, intelligence, and enforcement information.
    (i) Most information collected about an individual under criminal 
investigation is obtained from third parties, such as witnesses and 
informants. It is usually not feasible to rely upon the

[[Page 57]]

subject of the investigation as a source for information regarding his 
criminal activities.
    (ii) An attempt to obtain information from the subject of a criminal 
investigation will often alert that individual to the existence of an 
investigation, thereby affording the individual an opportunity to 
attempt to conceal his criminal activities so as to avoid apprehension.
    (iii) In certain instances, the subject of a criminal investigation 
is not required to supply information to criminal investigators as a 
matter of legal duty.
    (iv) During criminal investigations it is often a matter of sound 
investigative procedure to obtain information from a variety of sources 
to verify information already obtained.
    (9) 5 U.S.C. 552a(e)(3) requires an agency to inform each individual 
whom it asks to supply information, on the form that it uses to collect 
the information or on a separate form that the individual can retain, of 
the agency's authority for soliciting the information; whether 
disclosure of information is voluntary or mandatory; the principal 
purposes for which the agency will use the information; the routine uses 
that may be made of the information; and the effects on the individual 
of not providing all or part of the information. The systems of records 
should be exempted from this provision to avoid impairing the 
Department's ability to collect and collate investigative, intelligence, 
and enforcement data.
    (i) Confidential sources or undercover law enforcement officers 
often obtain information under circumstances in which it is necessary to 
keep the true purpose of their actions secret so as not to let the 
subject of the investigation or his or her associates know that a 
criminal investigation is in progress.
    (ii) If it became known that the undercover officer was assisting in 
a criminal investigation, that officer's physical safety could be 
endangered through reprisal, and that officer may not be able to 
continue working on the investigation.
    (iii) Individuals often feel inhibited in talking to a person 
representing a criminal law enforcement agency but are willing to talk 
to a confidential source or undercover officer whom they believe not to 
be involved in law enforcement activities.
    (iv) Providing a confidential source of information with written 
evidence that he or she was a source, as required by this provision, 
could increase the likelihood that the source of information would be 
subject to retaliation by the subject of the investigation.
    (v) Individuals may be contacted during preliminary information 
gathering, surveys, or compliance projects concerning the administration 
of the internal revenue laws before any individual is identified as the 
subject of an investigation. Informing the individual of the matters 
required by this provision would impede or compromise subsequent 
investigations.
    (vi) Finally, application of this provision could result in an 
unwarranted invasion of the personal privacy of the subject of the 
criminal investigation, particularly where further investigation reveals 
that the subject was not involved in any criminal activity.
    (10) 5 U.S.C. 552a(e)(5) requires an agency to maintain all records 
it uses in making any determination about any individual with such 
accuracy, relevance, timeliness, and completeness as is reasonably 
necessary to assure fairness to the individual in the determination.
    (i) Since 5 U.S.C. 552a(a)(3) defines ``maintain'' to include 
``collect'' and ``disseminate,'' application of this provision to the 
systems of records would hinder the initial collection of any 
information that could not, at the moment of collection, be determined 
to be accurate, relevant, timely, and complete. Similarly, application 
of this provision would seriously restrict the Department's ability to 
disseminate information pertaining to a possible violation of law to law 
enforcement and regulatory agencies. In collecting information during a 
criminal investigation, it is often impossible or unfeasible to 
determine accuracy, relevance, timeliness, or completeness prior to 
collection of the information. In disseminating information to law 
enforcement and regulatory agencies,

[[Page 58]]

it is often impossible to determine accuracy, relevance, timeliness, or 
completeness prior to dissemination, because the Department may not have 
the expertise with which to make such determinations.
    (ii) Information that may initially appear inaccurate, irrelevant, 
untimely, or incomplete may, when collated and analyzed with other 
available information, become more pertinent as an investigation 
progresses. In addition, application of this provision could seriously 
impede criminal investigators and intelligence analysts in the exercise 
of their judgment in reporting results obtained during criminal 
investigations.
    (iii) Compliance with the records maintenance criteria listed in the 
foregoing provision would require the periodic up-dating of the 
Department's protective intelligence files to insure that the records 
maintained in the system remain timely and complete.
    (11) 5 U.S.C. 552a(e)(8) requires an agency to make reasonable 
efforts to serve notice on an individual when the agency makes any 
record on the individual available to any person under compulsory legal 
process, when such process becomes a matter of public record. The 
systems of records should be exempted from this provision to avoid 
revealing investigative techniques and procedures outlined in those 
records and to prevent revelation of the existence of an ongoing 
investigation where there is need to keep the existence of the 
investigation secret.
    (12) 5 U.S.C. 552a(g) provides for civil remedies to an individual 
when an agency wrongfully refuses to amend a record or to review a 
request for amendment, when an agency wrongfully refuses to grant access 
to a record, when an agency fails to maintain accurate, relevant, 
timely, and complete records which are used to make a determination 
adverse to the individual, and when an agency fails to comply with any 
other provision of 5 U.S.C. 552a so as to adversely affect the 
individual. The systems of records should be exempted from this 
provision to the extent that the civil remedies may relate to provisions 
of 5 U.S.C. 552a from which these rules exempt the systems of records, 
since there should be no civil remedies for failure to comply with 
provisions from which the Department is exempted. Exemption from this 
provision will also protect the Department from baseless civil court 
actions that might hamper its ability to collate, analyze, and 
disseminate investigative, intelligence, and law enforcement data.
    (e) Specific exemptions under 5 U.S.C. 552a(k)(1). (1) Under 5 
U.S.C. 552a(k)(1), the head of any agency may promulgate rules to exempt 
any system of records within the agency from certain provisions of the 
Privacy Act of 1974 to the extent that the system contains information 
subject to the provisions of 5 U.S.C. 552(b)(1). This paragraph applies 
to the following system of records maintained by the Department of the 
Treasury:
    Financial Crimes Enforcement Network:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
FinCEN .001...............................  FinCEN Database.
------------------------------------------------------------------------

    (2) The Department of the Treasury hereby exempts the system of 
records listed in paragraph (e)(1) of this section from the following 
provisions of 5 U.S.C. 552a, pursuant to 5 U.S.C. 552a(k)(1): 5 U.S.C. 
552a(c)(3), 5 U.S.C. 552a(d)(1), (2), (3) and (4), 5 U.S.C. 552a(e)(1), 
5 U.S.C. 552a(e)(4)(G), (H), and (I), and 5 U.S.C. 552a(f).
    (f) Reasons for exemptions under 5 U.S.C. 552a(k)(1). The reason for 
invoking the exemption is to protect material required to be kept secret 
in the interest of national defense or foreign policy pursuant to 
Executive Order 12958 (or successor or prior Executive Order).
    (g) Specific exemptions under 5 U.S.C. 552a(k)(2). (1) Under 5 
U.S.C. 552a(k)(2), the head of any agency may promulgate rules to exempt 
any system of records within the agency from certain provisions of the 
Privacy Act of 1974 if the system is investigatory material compiled for 
law enforcement purposes and for the purposes of assuring the safety of 
individuals protected by the Department pursuant to the provisions of 18 
U.S.C. 3056. This paragraph applies to the following systems of records 
maintained by the Department of the Treasury:

[[Page 59]]

    (i) Departmental Offices:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
DO .114...................................  Foreign Assets Control
                                             Enforcement Records.
DO .144...................................  General Counsel Litigation
                                             Referral and Reporting
                                             System.
DO .190...................................  Investigation Data
                                             Management System.
DO .303...................................  TIGTA General
                                             Correspondence.
DO .307...................................  TIGTA Employee Relations
                                             Matters, Appeals,
                                             Grievances, and Complaint
                                             Files.
DO .308...................................  TIGTA Data Extracts.
DO .309...................................  TIGTA Chief Counsel Case
                                             Files.
DO .310...................................  TIGTA Chief Counsel
                                             Disclosure Section Records.
DO .311...................................  TIGTA Office of
                                             Investigations Files.
------------------------------------------------------------------------

    (ii) Bureau of Alcohol, Tobacco and Firearms:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
ATF .008..................................  Regulatory Enforcement
                                             Record System.
ATF .009..................................  Technical and Scientific
                                             Services Record System.
------------------------------------------------------------------------

    (iii) Comptroller of the Currency

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
CC .100...................................  Enforcement Action Report
                                             System
CC .110...................................  Reports of Suspicious
                                             Activities
CC .120...................................  Bank Fraud Information
                                             System
CC .220...................................  Section 914 Tracking System
CC .500...................................  Chief Counsel's Management
                                             Information System.
CC .510...................................  Litigation Information
                                             System
CC .600...................................  Consumer Complaint Inquiry
                                             and Information System
------------------------------------------------------------------------

    (iv) U.S. Customs Service:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
CS .021...................................  Arrest/Seizure/Search Report
                                             and Notice of Penalty File.
CS .022...................................  Attorney Case File.
CS .041...................................  Cartmen or Lightermen.
CS .043...................................  Case Files (Associate Chief
                                             Counsel--Gulf Custom
                                             Management Center).
CS .046...................................  Claims Case File.
CS .053...................................  Confidential Source
                                             Identification File.
CS .057...................................  Container Station Operator
                                             Files.
CS .058...................................  Cooperating Individual
                                             Files.
CS .061...................................  Court Case File.
CS .069...................................  Customhouse Brokers File
                                             (Chief Counsel).
CS .077...................................  Disciplinary Action,
                                             Grievances and Appeal Case
                                             Files.
CS .098...................................  Fines, Penalties, and
                                             Forfeitures Records.
CS .099...................................  Fines, Penalties, and
                                             Forfeiture Files
                                             (Supplemental Petitions).
CS .100...................................  Fines, Penalties, and
                                             Forfeiture Records
                                             (Headquarters).
CS .122...................................  Information Received File.
CS .125...................................  Intelligence Log.
CS .127...................................  Internal Affairs Records
                                             System.
CS .129...................................  Investigations Record
                                             System.
CS .133...................................  Justice Department Case
                                             File.
CS .138...................................  Litigation Issue Files.
CS .159...................................  Notification of Personnel
                                             Management Division when an
                                             employee is placed under
                                             investigation by the Office
                                             of Internal Affairs.
CS .171...................................  Pacific Basin Reporting
                                             Network.
CS .186...................................  Personnel Search.
CS .190...................................  Personnel Case File.
CS .197...................................  Private Aircraft/Vessel
                                             Inspection Reporting
                                             System.
CS .206...................................  Regulatory Audits of
                                             Customhouse Brokers.
CS .212...................................  Search/Arrest/Seizure
                                             Report.
CS .213...................................  Seized Assets and Case
                                             Tracking System (SEACATS).
CS .214...................................  Seizure File.
CS .224...................................  Suspect Persons Index.
CS .232...................................  Tort Claims Act File.
CS .244...................................  Treasury Enforcement
                                             Communications System
                                             (TECS).
CS .258...................................  Violator's Case Files.
CS .260...................................  Warehouse Proprietor Files.
CS .270...................................  Background-Record File of
                                             Non-Customs Employees.
CS .271...................................  Cargo Security Record
                                             System.
CS .285...................................  Automated Index to Central
                                             Investigative Files.
------------------------------------------------------------------------

    (v) Bureau of Engraving and Printing:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
BEP .021..................................  Investigative files.
------------------------------------------------------------------------

    (vi) Federal Law Enforcement Training Center
    (vii) Financial Management Service
    (viii) Internal Revenue Service:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
IRS 00.002................................  Correspondence File-
                                             Inquiries about Enforcement
                                             Activities.
IRS 00.007................................  Employee Complaint and
                                             Allegation Referral
                                             Records.
IRS 00.334................................  Third Party Contact Reprisal
                                             Records
IRS 22.061................................  Wage and Information Returns
                                             Processing (IRP).
IRS 26.001................................  Acquired Property Records.
IRS 26.006................................  Form 2209, Courtesy
                                             Investigations.
IRS 26.008................................  IRS and Treasury Employee
                                             Delinquency.
IRS 26.011................................  Litigation Case Files.
IRS 26.012................................  Offer in Compromise (OIC)
                                             Files.
IRS 26.013................................  One-hundred Per Cent Penalty
                                             Cases.
IRS 26.016................................  Returns Compliance Programs
                                             (RCP).
IRS 26.019................................  TDA (Taxpayer Delinquent
                                             Accounts).
IRS 26.020................................  TDI (Taxpayer Delinquency
                                             Investigations) Files.
IRS 26.021................................  Transferee Files.
IRS 26.022................................  Delinquency Prevention
                                             Programs.
IRS 34.020................................  IRS Audit Trail Lead
                                             Analysis System.
IRS 34.037................................  IRS Audit Trail and Security
                                             Records System.
IRS 37.002................................  Applicant Appeal Files.

[[Page 60]]

 
IRS 37.003................................  Closed Files Containing
                                             Derogatory Information
                                             about individuals' Practice
                                             before the IRS and Files of
                                             Attorneys and Certified
                                             Public Accountants Formerly
                                             Enrolled to Practice.
IRS 37.004................................  Derogatory Information (No
                                             Action).
IRS 37.005................................  Present Suspensions and
                                             Disbarments Resulting from
                                             Administrative Proceeding.
IRS 37.007................................  Inventory.
IRS 37.009................................  Resigned Enrolled Agents
                                             (action pursuant to 31 CFR
                                             Section 10.55(b)).
IRS 37.011................................  Present Suspensions from
                                             Practice Before the
                                             Internal Revenue Service.
IRS 42.001................................  Examination Administrative
                                             File.
IRS 42.008................................  Audit Information Management
                                             System (AIMS).
IRS 42.012................................  Combined Case Control Files.
IRS 42.016................................  Classification and
                                             Examination Selection
                                             Files.
IRS 42.017................................  International Enforcement
                                             Program Files.
IRS 42.021................................  Compliance Programs and
                                             Projects Files.
IRS 42.029................................  Audit Underreporter Case
                                             Files.
IRS 42.030................................  Discriminant Function File
                                             (DIF) Appeals Case Files.
IRS 42.031................................  Anti-Money Laundering/Bank
                                             Secrecy Act BSA) and Form
                                             8300 Records.
IRS 44.001................................  Appeals Case Files.
IRS 46.050................................  Automated Information
                                             Analysis System.
IRS 48.001................................  Disclosure Records.
IRS 49.001................................  Collateral and Information
                                             Requests System.
IRS 49.002................................  Component Authority and
                                             Index Card Mircofilm
                                             Retrieval System.
IRS 49.007................................  Overseas Compliance Projects
                                             System.
IRS 60.000................................  Employee Protection System
                                             Records
IRS 90.002................................  Chief Counsel Disclosure
                                             Litigation Division Case
                                             Files.
IRS 90.004................................  Chief Counsel General Legal
                                             Services Case Files.
IRS 90.005................................  Chief Counsel General
                                             Litigation Case Files.
IRS 90.009................................  Chief Counsel Field Case
                                             Service Files.
IRS 90.010................................  Digest Room Files Containing
                                             Briefs, Legal Opinions,
                                             Digests of Documents
                                             Generated Internally or by
                                             the Department of Justice
                                             Relating to the
                                             Administration of the
                                             Revenue Laws.
IRS 90.013................................  Legal case files of the
                                             Chief Counsel, Deputy Chief
                                             Counsel, Associate Chief
                                             Counsels (Enforcement
                                             Litigation) and
                                             (technical).
IRS 90.016................................  Counsel Automated Tracking
                                             System (CATS).
------------------------------------------------------------------------

    (ix) U.S. Mint:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
Mint .008.................................  Criminal investigation files
                                             (formerly: Investigatory
                                             Files on Theft of Mint
                                             Property).
------------------------------------------------------------------------

    (x) Bureau of the Public Debt.

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
BPD.009...................................  U.S. Treasury Securities
                                             Fraud Information System.
------------------------------------------------------------------------

    (xi) U.S. Secret Service:.

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
USSS .003.................................  Criminal Investigation
                                             Information System.
USSS .006.................................  Non-Criminal Investigation
                                             Information System.
USSS .007.................................  Protection Information
                                             System.
------------------------------------------------------------------------

    (xii) Office of Thrift Supervision:.

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
OTS .001..................................  Confidential Individual
                                             Information System.
OTS .004..................................  Criminal Referral Database.
------------------------------------------------------------------------

    (xiii) Financial Crimes Enforcement Network:

------------------------------------------------------------------------
                  Number                           Name of System
------------------------------------------------------------------------
FinCEN .001...............................  FinCEN Database.
FinCEN .002...............................  Suspicious Activity
                                             Reporting System.
FinCEN .003...............................  Bank Secrecy Act Reports
                                             System.
------------------------------------------------------------------------

    (2) The Department hereby exempts the systems of records listed in 
paragraphs (g)(1)(i) through (xiii) of this section from the following 
provisions of 5 U.S.C. 552a, pursuant to 5 U.S.C. 552a(k)(2): 5 U.S.C. 
552a(c)(3), 5 U.S.C. 552a(d)(1), (2), (3), (4), 5 U.S.C. 552a(e)(1), 5 
U.S.C. 552a(e)(4)(G), (H), and (I), and 5 U.S.C. 552a(f).
    (h) Reasons for exemptions under 5 U.S.C. 552a(k)(2). (1) 5 U.S.C. 
552a(c)(3) requires an agency to make accountings of disclosures of a 
record available to the individual named in the record upon his or her 
request. The accountings must state the date, nature, and purpose of 
each disclosure of the record and the name and address of the recipient.
    (i) The application of this provision would impair the ability of 
the Department and of law enforcement agencies outside the Department of 
the Treasury to make effective use of information maintained by the 
Department. Making accountings of disclosures available to the subjects 
of an investigation would alert them to the fact that an agency is 
conducting an investigation into their illegal activities

[[Page 61]]

and could reveal the geographic location of the investigation, the 
nature and purpose of that investigation, and the dates on which that 
investigation was active. Violators possessing such knowledge would be 
able to take measures to avoid detection or apprehension by altering 
their operations, by transferring their illegal activities to other 
geographical areas, or by destroying or concealing evidence that would 
form the basis for detection or apprehension. In the case of a 
delinquent account, such release might enable the subject of the 
investigation to dissipate assets before levy.
    (ii) Providing accountings to the subjects of investigations would 
alert them to the fact that the Department has information regarding 
their illegal activities and could inform them of the general nature of 
that information.
    (2) 5 U.S.C. 552a(d)(1), (e)(4)(H) and (f)(2), (3) and (5) grant 
individuals access to records pertaining to them. The application of 
these provisions to the systems of records would compromise the 
Department's ability to utilize and provide useful tactical and 
strategic information to law enforcement agencies.
    (i) Permitting access to records contained in the systems of records 
would provide individuals with information concerning the nature of any 
current investigations and would enable them to avoid detection or 
apprehension by:
    (A) discovering the facts that would form the basis for their 
detection or apprehension;
    (B) enabling them to destroy or alter evidence of illegal conduct 
that would form the basis for their detection or apprehension, and
    (C) using knowledge that investigators had reason to believe that a 
violation of law was about to be committed, to delay the commission of 
the violation or commit it at a location that might not be under 
surveillance.
    (ii) Permitting access to either on-going or closed investigative 
files would also reveal investigative techniques and procedures, the 
knowledge of which could enable individuals planning non-criminal acts 
to structure their operations so as to avoid detection or apprehension.
    (iii) Permitting access to investigative files and records could, 
moreover, disclose the identity of confidential sources and informers 
and the nature of the information supplied and thereby endanger the 
physical safety of those sources by exposing them to possible reprisals 
for having provided the information. Confidential sources and informers 
might refuse to provide investigators with valuable information unless 
they believed that their identities would not be revealed through 
disclosure of their names or the nature of the information they 
supplied.Loss of access to such sources would seriously impair the 
Department's ability to carry out its mandate.
    (iv) Furthermore, providing access to records contained in the 
systems of records could reveal the identities of undercover law 
enforcement officers or other persons who compiled information regarding 
the individual's illegal activities and thereby endanger the physical 
safety of those undercover officers, persons, or their families by 
exposing them to possible reprisals.
    (v) By compromising the law enforcement value of the systems of 
records for the reasons outlined in paragraphs (h)(2)(i) through (iv) of 
this section, permitting access in keeping with these provisions would 
discourage other law enforcement and regulatory agencies, foreign and 
domestic, from freely sharing information with the Department and thus 
would restrict the Department's access to information necessary to 
accomplish its mission most effectively.
    (vi) Finally, the dissemination of certain information that the 
Department may maintain in the systems of records is restricted by law.
    (3) 5 U.S.C. 552a(d)(2), (3) and (4), (e)(4)(H), and (f)(4) permit 
an individual to request amendment of a record pertaining to him or her 
and require the agency either to amend the record, or to note the 
disputed portion of the record and to provide a copy of the individual's 
statement of disagreement with the agency's refusal to amend a record to 
persons or other agencies to whom the record is thereafter disclosed. 
Since these provisions depend on the individual's having access to his

[[Page 62]]

or her records, and since these rules exempt the systems of records from 
the provisions of 5 U.S.C. 552a relating to access to records, for the 
reasons set out in paragraph (h)(2) of this section, these provisions 
should not apply to the systems of records.
    (4) 5 U.S.C. 552a(e)(1) requires an agency to maintain in its 
records only such information about an individual as is relevant and 
necessary to accomplish a purpose of the agency required to be 
accomplished by statute or executive order. The term ``maintain,'' as 
defined in 5 U.S.C. 552a(a)(3), includes ``collect'' and 
``disseminate.'' The application of this provision to the system of 
records could impair the Department's ability to collect, utilize and 
disseminate valuable law enforcement information.
    (i) At the time that the Department collects information, it often 
lacks sufficient time to determine whether the information is relevant 
and necessary to accomplish a Department purpose.
    (ii) In many cases, especially in the early stages of investigation, 
it may be impossible immediately to determine whether information 
collected is relevant and necessary, and information that initially 
appears irrelevant and unnecessary often may, upon further evaluation or 
upon collation with information developed subsequently, prove 
particularly relevant to a law enforcement program.
    (iii) Not all violations of law discovered by the Department 
analysts fall within the investigative jurisdiction of the Department of 
the Treasury. To promote effective law enforcement, the Department will 
have to disclose such violations to other law enforcement agencies, 
including State, local and foreign agencies that have jurisdiction over 
the offenses to which the information relates. Otherwise, the Department 
might be placed in the position of having to ignore information relating 
to violations of law not within the jurisdiction of the Department of 
the Treasury when that information comes to the Department's attention 
during the collation and analysis of information in its records.
    (5) U.S.C. 552a (e)(4)(G) and (f)(1) enable individuals to inquire 
whether a system of records contains records pertaining to them. 
Application of these provisions to the systems of records would allow 
individuals to learn whether they have been identified as suspects or 
subjects of investigation. As further described in the following 
paragraph, access to such knowledge would impair the Department's 
ability to carry out its mission, since individuals could:
    (i) Take steps to avoid detection;
    (ii) Inform associates that an investigation is in progress;
    (iii) Learn the nature of the investigation;
    (iv) Learn whether they are only suspects or identified as law 
violators;
    (v) Begin, continue, or resume illegal conduct upon learning that 
they are not identified in the system of records; or
    (vi) Destroy evidence needed to prove the violation.
    (6) 5 U.S.C. 552a(e)(4)(I) requires an agency to publish a general 
notice listing the categories of sources for information contained in a 
system of records. The application of this provision to the systems of 
records could compromise the Department's ability to complete or 
continue investigations or to provide useful information to law 
enforcement agencies, since revealing sources for the information could:
    (i) Disclose investigative techniques and procedures;
    (ii) Result in threats or reprisals against informers by the 
subjects of investigations; and
    (iii) Cause informers to refuse to give full information to 
investigators for fear of having their identities as sources disclosed.
    (i) Specific exemptions under 5 U.S.C. 552a(k)(3). (1) The head of 
any agency may promulgate rules to exempt any system of records within 
the agency from certain provisions of the Privacy Act of 1974 if it is 
maintained in connection with providing protective intelligence to the 
President of the United States or other individuals pursuant to section 
3056 of Title 18. This paragraph applies to the following system of 
records maintained by the Department which contains material relating to 
criminal investigations concerned with the enforcement of criminal 
statutes involving the security of persons and property. Further, this

[[Page 63]]

system contains records described in 5 U.S.C. 552a(k) including, but not 
limited to, classified material and investigatory material compiled for 
law enforcement purposes, for which exemption is claimed under 5 U.S.C. 
552a(k)(3):
    U.S. Secret Service:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
USSS .007.................................  Protection Information
                                             System.
------------------------------------------------------------------------

    (2) The Department hereby exempts the system of records listed in 
(i)(1) of this section from the following provisions of 5 U.S.C. 552a, 
pursuant to 5 U.S.C. 552a(k)(3): 5 U.S.C. 552a(c)(3), 5 U.S.C. 
552a(d)(1), (2), (3),and (4), 5 U.S.C. 552a(e)(1), 5 U.S.C. 
552a(e)(4)(G), (H), and (I), and 5 U.S.C. 552a(f).
    (j) Reasons for exemptions under 5 U.S.C. 552a(k)(3). (1) 5 U.S.C. 
552a(c)(3) requires an agency to make accountings of disclosures of a 
record available to the individual named in the record upon his or her 
request. The accountings must state the date, nature, and purpose of 
each disclosure of the record and the name and address of the recipient.
    (i) The application of this provision would impair the ability of 
law enforcement agencies outside the Department of the Treasury to make 
effective use of information provided by the Department. Making 
accountings of disclosures available to the subjects of an investigation 
would alert them to the fact that another agency is conducting an 
investigation into their criminal activities and could reveal the 
geographic location of the other agency's investigation, the nature and 
purpose of that investigation, and the dates on which the investigation 
was active. Violators possessing such knowledge would be able to take 
measures to avoid detection or apprehension by altering their 
operations, by transferring their criminal activities to other 
geographical areas, or by destroying or concealing evidence that would 
form the basis for arrest.
    (ii) Providing accountings to the subjects of investigations would 
alert them to the fact that the Department has information regarding 
their criminal activities and could inform them of the general nature of 
that information. Access to such information could reveal the operation 
of the Department's information-gathering and analysis systems and 
permit violators to take steps to avoid detection or apprehension.
    (iii) The release of such information to the subject of a protective 
intelligence file would provide significant information concerning the 
nature and scope of an investigation, and could result in impeding or 
compromising the efforts of Department personnel to detect persons 
suspected of criminal activities or to collect information necessary for 
the proper evaluation of persons considered to be of protective 
interest.
    (2) 5 U.S.C. 552a(d)(1), (e)(4)(H) and (f)(2), (3) and (5) grant 
individuals access to records pertaining to them. The application of 
these provisions to the systems of records would compromise the 
Department's ability to provide useful tactical and strategic 
information to law enforcement agencies.
    (i) Permitting access to records contained in the systems of records 
would provide individuals with information concerning the nature of any 
current investigations and would enable them to avoid detection or 
apprehension by:
    (A) Discovering the facts that would form the basis for their 
arrest;
    (B) Enabling them to destroy or alter evidence of criminal conduct 
that would form the basis for their arrest, and
    (C) Using knowledge that criminal investigators had reason to 
believe that a crime was about to be committed, to delay the commission 
of the crime or commit it at a location that might not be under 
surveillance.
    (ii) Permitting access to either on-going or closed investigative 
files would also reveal investigative techniques and procedures, the 
knowledge of which could enable individuals planning crimes to structure 
their operations so as to avoid detection or apprehension.
    (iii) Permitting access to investigative files and records could, 
moreover, disclose the identity of confidential sources, and informers 
and the nature of the information supplied and thereby endanger the 
physical safety of

[[Page 64]]

those sources by exposing them to possible reprisals for having provided 
the information. Confidential sources and informers might refuse to 
provide criminal investigators with valuable information unless they 
believed that their identities would not be revealed through disclosure 
of their names or the nature of the information they supplied. Loss of 
access to such sources would seriously impair the Department's ability 
to carry out its mandate.
    (iv) Furthermore, providing access to records contained in the 
systems of records could reveal the identities of undercover law 
enforcement officers who compiled information regarding the individual's 
criminal activities and thereby endanger the physical safety of those 
undercover officers or their families by exposing them to possible 
reprisals.
    (v) By compromising the law enforcement value of the systems of 
records for the reasons outlined in paragraphs (j)(2)(i) through (iv) of 
this section, permitting access in keeping with these provisions would 
discourage other law enforcement and regulatory agencies, foreign and 
domestic, from freely sharing information with the Department and thus 
would restrict the Department's access to information necessary to 
accomplish its mission most effectively.
    (vi) Limitation on access to the materials contained in the 
protective intelligence files is considered necessary to the 
preservation of the utility of intelligence files and in safeguarding 
those persons the Department is authorized to protect. Access to the 
protective intelligence files could adversely affect the quality of 
information available to the Department; compromise confidential 
sources; hinder the ability of the Department to keep track of persons 
of protective interest; and interfere with the Department's protective 
intelligence activities by individuals gaining access to protective 
intelligence files.
    (vii) Many of the persons on whom records are maintained in the 
protective intelligence files suffer from mental aberrations. Knowledge 
of their condition and progress comes from authorities, family members 
and witnesses. Many times this information comes to the Department as a 
result of two-party conversations where it would be impossible to hide 
the identity of informants. Sources of information must be developed, 
questions asked and answers recorded. Trust must be extended and 
guarantees of confidentiality and anonymity must be maintained. Allowing 
access of information of this kind to individuals who are the subjects 
of protective interest may well lead to violence directed against an 
informant by a mentally disturbed individual.
    (viii) Finally, the dissemination of certain information that the 
Department may maintain in the systems of records is restricted by law.
    (3) 5 U.S.C. 552a(d)(2), (3) and (4), (e)(4)(H), and (f)(4) permit 
an individual to request amendment of a record pertaining to him or her 
and require the agency either to amend the record, or to note the 
disputed portion of the record and to provide a copy of the individual's 
statement of disagreement with the agency's refusal to amend a record to 
persons or other agencies to whom the record is thereafter disclosed. 
Since these provisions depend on the individual's having access to his 
or her records, and since these rules exempt the systems of records from 
the provisions of 5 U.S.C. 552a relating to access to records, for the 
reasons set out in paragraph (j)(2) of this section, these provisions 
should not apply to the systems of records.
    (4) 5 U.S.C. 552a(e)(1) requires an agency to maintain in its 
records only such information about an individual as is relevant and 
necessary to accomplish a purpose of the agency required to be 
accomplished by statute or executive order. The term ``maintain,'' as 
defined in 5 U.S.C. 552a(a)(3), includes ``collect'' and 
``disseminate.'' The application of this provision to the systems of 
records could impair the Department's ability to collect and disseminate 
valuable law enforcement information.
    (i) At the time that the Department collects information, it often 
lacks sufficient time to determine whether the information is relevant 
and necessary to accomplish a Department purpose.

[[Page 65]]

    (ii) In many cases, especially in the early stages of investigation, 
it may be impossible immediately to determine whether information 
collected is relevant and necessary, and information that initially 
appears irrelevant and unnecessary often may, upon further evaluation or 
upon collation with information developed subsequently, prove 
particularly relevant to a law enforcement program.
    (iii) Not all violations of law discovered by the Department 
analysts fall within the scope of the protective intelligence 
jurisdiction of the Department of the Treasury. To promote effective law 
enforcement, the Department will have to disclose such violations to 
other law enforcement agencies, including State, local and foreign 
agencies, that have jurisdiction over the offenses to which the 
information relates. Otherwise, the Department might be placed in the 
position of having to ignore information relating to violations of law 
not within the jurisdiction of the Department of the Treasury when that 
information comes to the Department's attention during the collation and 
analysis of information in its records.
    (5) U.S.C. 552a (e)(4)(G) and (f)(1) enable individuals to inquire 
whether a system of records contains records pertaining to them. 
Application of these provisions to the systems of records would allow 
individuals to learn whether they have been identified as suspects or 
subjects of investigation. As further described in the following 
paragraph, access to such knowledge would impair the Department's 
ability to carry out its mission to safeguard those persons the 
Department is authorized to protect, since individuals could:
    (i) Take steps to avoid detection;
    (ii) Inform associates that an investigation is in progress;
    (iii) Learn the nature of the investigation;
    (iv) Learn whether they are only suspects or identified as law 
violators;
    (v) Begin, continue, or resume illegal conduct upon learning that 
they are not identified in the system of records; or
    (vi) Destroy evidence needed to prove the violation.
    (6) 5 U.S.C. 552a(e)(4)(I) requires an agency to publish a general 
notice listing the categories of sources for information contained in a 
system of records. The application of this provision to the systems of 
records could compromise the Department's ability to provide useful 
information to law enforcement agencies, since revealing sources for the 
information could:
    (i) Disclose investigative techniques and procedures;
    (ii) Result in threats or reprisals against informers by the 
subject(s) of a protective intelligence file; and
    (iii) Cause informers to refuse to give full information to criminal 
investigators for fear of having their identities as sources disclosed.
    (k) Specific exemptions under 5 U.S.C. 552a(k)(4). (1) Under 5 
U.S.C. 552a(k)(4), the head of any agency may promulgate rules to exempt 
any system of records within the agency from certain provisions of the 
Privacy Act of 1974 if the system is required by statute to be 
maintained and used solely as statistical records. This paragraph 
applies to the following system of records maintained by the Department, 
for which exemption is claimed under 5 U.S.C. 552a(k)(4):
    Internal Revenue Service:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
IRS 70.001................................  Statistics of Income-
                                             Individual Tax Returns.
------------------------------------------------------------------------

    (2) The Department hereby exempts the system of records listed in 
paragraph (k)(1) of this section from the following provisions of 5 
U.S.C. 552a, pursuant to 5 U.S.C. 552a(k)(4): 5 U.S.C. 552a(c)(3), 5 
U.S.C. 552a(d)(1), (2), (3), and (4), 5 U.S.C. 552a(e)(1), 5 U.S.C. 
552a(e)(4)(G), (H), and (I), and 5 U.S.C. 552a(f).
    (3) The system of records is maintained under section 6108 of the 
Internal Revenue Code, which provides that ``the Secretary or his 
delegate shall prepare and publish annually statistics reasonably 
available with respect to the operation of the income tax laws, 
including classifications of taxpayers and of income, the amounts 
allowed as deductions, exemptions, and credits, and any other facts 
deemed pertinent and valuable.''

[[Page 66]]

    (l) Reasons for exemptions under 5 U.S.C. 552a(k)(4). The reason for 
exempting the system of records is that disclosure of statistical 
records (including release of accounting for disclosures) would in most 
instances be of no benefit to a particular individual since the records 
do not have a direct effect on a given individual.
    (m) Specific exemptions under 5 U.S.C. 552a(k)(5). (1) Under 5 
U.S.C. 552a(k)(5), the head of any agency may promulgate rules to exempt 
any system of records within the agency from certain provisions of the 
Privacy Act of 1974 if the system is investigatory material compiled 
solely for the purpose of determining suitability, eligibility, and 
qualifications for Federal civilian employment or access to classified 
information, but only to the extent that the disclosure of such material 
would reveal the identity of a source who furnished information to the 
Government under an express promise that the identity of the source 
would be held in confidence, or, prior to September 27, 1975, under an 
implied promise that the identity of the source would be held in 
confidence. Thus to the extent that the records in this system can be 
disclosed without revealing the identity of a confidential source, they 
are not within the scope of this exemption and are subject to all the 
requirements of the Privacy Act. This paragraph applies to the following 
systems of records maintained by the Department or one of its bureaus:
    (i) Departmental Offices:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
DO .004...................................  Personnel Security System.
DO .306...................................  TIGTA Recruiting and
                                             Placement.
------------------------------------------------------------------------

    (ii) Bureau of Alcohol, Tobacco and Firearms:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
ATF .007..................................  Personnel Record System.
------------------------------------------------------------------------

    (iii) Comptroller of the Currency:
    (iv) U.S. Customs Service:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
CS .127...................................  Internal Affairs Records.
------------------------------------------------------------------------

    (v) Bureau of Engraving and Printing:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
[Reserved]................................  ............................
------------------------------------------------------------------------

    (vi) Federal Law Enforcement Training Center
    (vii) Financial Management Service
    (viii) Internal Revenue Service:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
IRS 34.021................................  Personnel Security
                                             Investigations, National
                                             Background Investigations
                                             Center.
IRS 36.008................................  Recruiting, Examining and
                                             Placement Records.
IRS 90.003................................  Chief Counsel General
                                             Administrative Systems.
IRS 90.011................................  Attorney Recruiting Files.
------------------------------------------------------------------------

    (ix) U.S. Mint
    (x) Bureau of the Public Debt
    (xi) U.S. Secret Service
    (xii) Office of Thrift Supervision
    (xiii) Financial Crimes Enforcement Network:
    (2) The Department hereby exempts the systems of records listed in 
paragraph (m)(1)(i) through (xiii) of this section from the following 
provisions of 5 U.S.C. 552a, pursuant to 5 U.S.C. 552a(k)(5): 5 U.S.C. 
552a(c)(3), 5 U.S.C. 552a(d)(1), (2), (3), and (4), 5 U.S.C. 552a(e)(1), 
5 U.S.C. 552a(e)(4)(G), (H), and (I), and 5 U.S.C. 552a(f).
    (n) Reasons for exemptions under 5 U.S.C. 552a(k)(5). (1) The 
sections of 5 U.S.C. 552a from which the systems of records are exempt 
include in general those providing for individuals' access to or 
amendment of records. When such access or amendment would cause the 
identity of a confidential source to be revealed, it would impair the 
future ability of the Department to compile investigatory material for 
the purpose of determining suitability, eligibility, or qualifications 
for Federal civilian employment, Federal contracts, or access to 
classified information. In addition, the systems shall be exempt from 5 
U.S.C. 552a(e)(1) which requires that an agency maintain in its records 
only such information about an individual as is relevant and necessary 
to accomplish a purpose of the agency required to be accomplished by 
statute or executive order. The Department believes that to fulfill the 
requirements of 5 U.S.C. 552a(e)(1) would unduly restrict the agency in 
its information gathering inasmuch as it is often not until

[[Page 67]]

well after the investigation that it is possible to determine the 
relevance and necessity of particular information.
    (2) If any investigatory material contained in the above-named 
systems becomes involved in criminal or civil matters, exemptions of 
such material under 5 U.S.C. 552a (j)(2) or (k)(2) is hereby claimed.
    (o) Exemption under 5 U.S.C. 552a(k)(6). (1) Under 5 U.S.C. 
552a(k)(6), the head of any agency may promulgate rules to exempt any 
system of records that is testing or examination material used solely to 
determine individual qualifications for appointment or promotion in the 
Federal service the disclosure of which would compromise the objectivity 
or fairness of the testing or examination process. This paragraph 
applies to the following system of records maintained by the Department, 
for which exemption is claimed under 5 U.S.C. 552a(k)(6):
    Internal Revenue Service:

------------------------------------------------------------------------
                  Number                             System name
------------------------------------------------------------------------
IRS 36.008................................  Recruiting, Examining and
                                             Placement Records.
DO .306...................................  TIGTA Recruiting and
                                             Placement.
------------------------------------------------------------------------

    (2) The Department hereby exempts the system of records listed in 
paragraph (o)(1) of this section from the following provisions of 5 
U.S.C. 552a, pursuant to 5 U.S.C. 552a(k)(6): 5 U.S.C. 552a(c)(3), 5 
U.S.C. 552a(d)(1), (2), (3), and (4), 5 U.S.C. 552a(e)(1), 5 U.S.C. 
552a(e)(4)(G), (H), and (I), and 5 U.S.C. 552a(f).
    (p) Reasons for exemptions under 5 U.S.C. 552a(k)(6). The reason for 
exempting the system of records is that disclosure of the material in 
the system would compromise the objectivity or fairness of the 
examination process.
    (q) Exempt information included in another system. Any information 
from a system of records for which an exemption is claimed under 5 
U.S.C. 552a(j) or (k) which is also included in another system of 
records retains the same exempt status such information has in the 
system for which such exemption is claimed.

[65 FR 69867, Nov. 21, 2000; 65 FR 76005, Dec. 5, 2000, as amended at 66 
FR 16603, Mar. 27, 2001; 66 FR 18192, Apr. 6, 2001; 66 FR 48556, Sept. 
21, 2001; 67 FR 34403, May 14, 2002; 67 FR 48487, July 24, 2002; 67 FR 
62886, Oct. 9, 2002; 68 FR 32638, June 2, 2003; 68 FR 55311, Sept. 25, 
2003; 68 FR 67944, Dec. 5, 2003; 69 FR 17299, Apr. 2, 2004; 70 FR 2806, 
Jan. 18, 2005]

         Appendix A to Subpart C of Part 1--Departmental Offices

    1. In general. This appendix applies to the Departmental Offices as 
defined in 31 CFR part 1, subpart C, Sec. 1.20. It sets forth specific 
notification and access procedures with respect to particular systems of 
records, identifies the officers designated to make the initial 
determinations with respect to notification and access to records, the 
officers designated to make the initial and appellate determinations 
with respect to requests for amendment of records, the officers 
designated to grant extensions of time on appeal, the officers with whom 
``Statement of Disagreement'' may be filed, the officer designated to 
receive service of process and the addresses for delivery of requests, 
appeals, and service of process. In addition, it references the notice 
of systems of records and notices of the routine uses of the information 
in the system required by 5 U.S.C. 552a(e)(4) and (11) and published 
annually by the Office of the Federal Register in ``Privacy Act 
Issuances''.
    2. Requests for notification and access to records and accountings 
of disclosures. Initial determinations under 31 CFR 1.26, whether to 
grant requests for notification and access to records and accountings of 
disclosures for the Departmental Offices, will be made by the head of 
the organizational unit having immediate custody of the records 
requested, or the delegate of such official. This information is 
contained in the appropriate system notice in the ``Privacy Act 
Issuances'', published annually by the Office of the Federal Register. 
Requests for information and specific guidance on where to send requests 
for records should be addressed to:
    Privacy Act Request, DO, Department of the Treasury, 1500 
Pennsylvania Avenue, NW., Washington, DC 20220.
    Requests may be delivered personally to the Main Treasury Building, 
Room 5030, 1500 Pennsylvania Avenue NW., Washington, DC.
    3. Requests for amendments of records. Initial determinations under 
31 CFR 1.27(a) through (d) with respect to requests to amend records for 
records maintained by the Departmental Offices will be made by the head 
of the organization or unit having immediate custody of the records or 
the delegate of such official. Requests for amendment of records should 
be

[[Page 68]]

addressed as indicated in the appropriate system notice in ``Privacy Act 
Issuances'' published by the Office of the Federal Register. Requests 
for information and specific guidance on where to send these requests 
should be addressed to: Privacy Act Amendment Request, DO, Department of 
the Treasury, 1500 Pennsylvania Avenue, NW., Washington, DC 20220.
    4. Administrative appeal of initial determination refusing to amend 
record. Appellate determinations under 31 CFR 1.27(e) with respect to 
records of the Departmental Offices, including extensions of time on 
appeal, will be made by the Secretary, Deputy Secretary, Under 
Secretary, General Counsel, or Assistant Secretary having jurisdiction 
over the organizational unit which has immediate custody of the records, 
or the delegate of such official, as limited by 5 U.S.C. 552a(d) (2) and 
(3). Appeals made by mail should be addressed as indicated in the letter 
of initial decision or to:
    Privacy Act Amendment Request, DO Department of the Treasury, 1500 
Pennsylvania Avenue, NW., Washington, DC 20220. Appeals may be delivered 
personally to the Library, Room 5030, Main Treasury Building, 1500 
Pennsylvania Avenue, NW., Washington, DC.
    5. Statements of disagreement. ``Statements of Disagreement'' as 
described in 31 CFR 1.27(e)(4) shall be filed with the official signing 
the notification of refusal to amend at the address indicated in the 
letter of notification within 35 days of the date of notification and 
should be limited to one page.
    6. Service of process. Service of process will be received by the 
General Counsel of the Department of the Treasury or the delegate of 
such official and shall be delivered to the following location:
    General Counsel, Department of the Treasury, Room 3000, Main 
Treasury Building, 1500 Pennsylvania Avenue, NW., Washington, DC 20220.
    7. Annual notice of systems of records. The annual notice of systems 
of records required to be published by the Office of the Federal 
Register in the publication entitled ``Privacy Act Issuances'', as 
specified in 5 U.S.C. 552a (f). Any specific requirements for access, 
including identification requirements, in addition to the requirements 
set forth in 31 CFR 1.26 and 1.27 and 8 of this appendix, and locations 
for access are indicated in the notice for the pertinent system.
    8. Verification of identity. An individual seeking notification or 
access to records, or seeking to amend a record, must satisfy one of the 
following identification requirements before action will be taken by the 
Departmental Offices on any such request:
    (i) An individual seeking notification or access to records in 
person, or seeking to amend a record in person, may establish identity 
by the presentation of a single official document bearing a photograph 
(such as a passport or identification badge) or by the presentation of 
two items of identification which do not bear a photograph but do bear 
both a name and signature (such as a driver's license or credit card).
    (ii) An individual seeking notification or access to records by 
mail, or seeking to amend a record by mail, may establish identity by a 
signature, address, and one other identifier such as a photocopy of a 
driver's license or other official document bearing the individual's 
signature.
    (iii) Notwithstanding subdivisions (i) and (ii) of this 
subparagraph, an individual seeking notification or access to records by 
mail or in person, or seeking to amend a record by mail or in person, 
who so desires, may establish identity by providing a notarized 
statement, swearing or affirming to such individual's identity and to 
the fact that the individual understands the penalties provided in 5 
U.S.C. 552a(i)(3) for requesting or obtaining access to records under 
false pretenses.
Notwithstanding subdivision (i), (ii), or (iii) of this subparagraph, a 
designated official may require additional proof of an individual's 
identity before action will be taken on any request, if such official 
determines that it is necessary to protect against unauthorized 
disclosure of information in a particular case. In addition, a parent of 
any minor or a legal guardian of any individual will be required to 
provide adequate proof of legal relationship before such person may act 
on behalf of such minor or such individual.

       Appendix B to Subpart C of Part 1--Internal Revenue Service

    1. Purpose. The purpose of this section is to set forth the 
procedures that have been established by the Internal Revenue Service 
for individuals to exercise their rights under the Privacy Act of 1974 
(88 Stat. 1896) with respect to systems of records maintained by the 
Internal Revenue Service, including the Office of the Chief Counsel. The 
procedures contained in this section are to be promulgated under the 
authority of 5 U.S.C. 552a(f). The procedures contained in this section 
relate to the following:
    (a) The procedures whereby an individual can be notified in response 
to a request if a system of records named by the individual contains a 
record pertaining to such individual (5 U.S.C. 552a(f)(1)).
    (b) The procedures governing reasonable times, places, and 
requirements for identifying an individual who requests a record of 
information pertaining to such individual before the Internal Revenue 
Service will make the record or information available to the individual 
(5 U.S.C. 552a (f)(2)).
    (c) The procedures for the disclosure to an individual upon a 
request of a record of information pertaining to such individual, 
including special procedures for the disclosure

[[Page 69]]

to an individual of medical records, including psychological records. (5 
U.S.C. 552a (f)(3)).
    (d) The procedures for reviewing a request from an individual 
concerning the amendment of any record or information pertaining to the 
individual, for making a determination on the request, for an appeal 
within the Internal Revenue Service of an initial adverse agency 
determination, and for whatever additional means may be necessary for 
individuals to be able to exercise fully their right under 5 U.S.C. 552a 
(5 U.S.C. 552a (f)(4)).
    Any individual seeking to determine whether a system of records 
maintained by any office of the Internal Revenue Service contains a 
record or information pertaining to such individual, or seeking access 
to, or amendment of, such a record, must comply fully with the 
applicable procedure contained in paragraph (3) or (4) of this section 
before the Internal Revenue Service will act on the request. Neither the 
notification and access (or accounting of disclosures) procedures under 
paragraph (3) of this section nor the amendment procedures under 
paragraph (4) of this section are applicable to (i) systems of records 
exempted pursuant to 5 U.S.C. 552a (j) and (k), (ii) information 
compiled in reasonable anticipation of a civil action or proceeding (see 
5 U.S.C. 552a (d)(5)), or (iii) information pertaining to an individual 
which is contained in, and inseparable from, another individual's 
record.
    2. Access to and amendment of tax records. The provisions of the 
Privacy Act of 1974 may not be used by an individual to amend or correct 
any tax record. The determination of liability for taxes imposed by the 
Internal Revenue Service Code, the collection of such taxes, and the 
payment (including credits or refunds of overpayments) of such taxes are 
governed by the provisions of the Internal Revenue Service Code and by 
the procedural rules of the Internal Revenue Service. These provisions 
set forth the established procedures governing the determination of 
liability for tax, the collection of such taxes, and the payment 
(including credits or refunds of overpayments) of such taxes. In 
addition, these provisions set forth the procedures (including 
procedures for judicial review) for resolving disputes between taxpayers 
and the Internal Revenue Service involving the amount of tax owed, or 
the payment or collection of such tax. These procedures are the 
exclusive means available to an individual to contest the amount of any 
liability for tax or the payment or collection thereof. See, for 
example, 26 CFR 601.103 for summary of general tax procedures. 
Individuals are advised that Internal Revenue Service procedures permit 
the examination of tax records during the course of an investigation, 
audit, or collection activity. Accordingly, individuals should contact 
the Internal Revenue Service employee conducting an audit or effecting 
the collection of tax liabilities to gain access to such records, rather 
than seeking access under the provisions of the Privacy Act. Where, on 
the other hand, an individual desires information or records not in 
connection with an investigation, audit, or collection activity, the 
individual may follow these procedures.
    3. Procedures for access to records--(a) In general. This paragraph 
sets forth the procedure whereby an individual can be notified in 
response to a request if a system of records named by the individual 
which is maintained by the Internal Revenue Service contains a record 
pertaining to such individual. In addition, this paragraph sets forth 
the procedure for the disclosure to an individual upon a request of a 
record or information pertaining to such individual, including the 
procedures for verifying the identity of the individual before the 
Internal Revenue Service will make a record available, and the procedure 
for requesting an accounting of disclosures of such records. An 
individual seeking to determine whether a particular system of records 
contains a record or records pertaining to such individual and seeking 
access to such records (or seeking an accounting of disclosures of such 
records) shall make a request for notification and access (or a request 
for an accounting of disclosures) in accordance with the rules provided 
in paragraph 3(b) of this section.
    (b) Form of request for notification and access or request for an 
accounting of disclosures. (i) A request for notification and access (or 
request for an accounting of disclosures) shall be made in writing and 
shall be signed by the person making the request.
    (ii) Such request shall be clearly marked, ``Request for 
notification and access,'' or ``Request for accounting of disclosures.''
    (iii) Such a request shall contain a statement that it is being made 
under the provisions of the Privacy Act of 1974.
    (iv) Such request shall contain the name and address of the 
individual making the request. In addition, if a particular system 
employs an individual's social security number as an essential means of 
accessing the system, the request must include the individual's social 
security number. In the case of a record maintained in the name of two 
or more individuals (e.g., husband and wife), the request shall contain 
the names, addresses, and social security numbers (if necessary) of both 
individuals.
    (v) Such request shall specify the name and location of the 
particular system of records (as set forth in the Notice of Systems) for 
which the individual is seeking notification and access (or an 
accounting of disclosures), and the title and business address of the 
official designated in the access section for the particular system (as 
set forth in the Notice of Systems). In the case of two or more systems 
of records which are under the control

[[Page 70]]

of the same designated official at the same systems location, a single 
request may be made for such systems. In the case of two or more systems 
of records which are not in the control of the same designated official 
at the same systems location, a separate request must be made for each 
such system.
    (vi) If an individual wishes to limit a request for notification and 
access to a particular record or records, the request should identify 
the particular record. In the absence of a statement to the contrary, a 
request for notification and access for a particular system of records 
shall be considered to be limited to records which are currently 
maintained by the designated official at the systems location specified 
in the request.
    (vii) If such request is seeking notification and access to material 
maintained in a system of records which is exempt from disclosure and 
access under 5 U.S.C. 552a (k)(2), the individual making the request 
must establish that such individual has been denied a right, privilege, 
or benefit that such individual would otherwise be entitled to under 
Federal law as a result of the maintenance of such material.
    (viii) Such request shall state whether the individual wishes to 
inspect the record in person, or desires to have a copy made and 
furnished without first inspecting it. If the individual desires to have 
a copy made, the request must include an agreement to pay the fee for 
duplication ultimately determined to be due. If the individual does not 
wish to inspect a record, but merely wishes to be notified whether a 
particular system or records contains a record pertaining to such 
individual, the request should so state.
    (c) Time and place for making a request. A request for notification 
and access to records under the Privacy Act (or a request for accounting 
of disclosures) shall be addressed to or delivered in person to the 
office of the official designated in the access section for the 
particular system of records for which the individual is seeking 
notification and access (or an accounting of disclosures). The title and 
office address of such official is set forth for each system of records 
in the Notice of Systems of Records. A request delivered to an office in 
person must be delivered during the regular office hours of that office.
    (d) Sample request for notification and access to records. The 
following are sample requests for notification and access to records 
which will satisfy the requirements of this paragraph:

         Request for Notification and Access to Records by Mail

    I, John Doe, of 100 Main Street, Boston, MA 02108 (soc. sec. num. 
000-00-0000) request under the Privacy Act of 1974 that the following 
system of records be examined and that I be furnished with a copy of any 
record (or a specified record) contained therein pertaining to me. I 
agree that I will pay the fees ultimately determined to be due for 
duplication of such record. I have enclosed the necessary information.

System Name:
System Location:
Designated Official:

________________________________________________________________________
                                                                John Doe

        Request for Notification and Access to Records in Person

    I, John Doe, of 100 Main Street, Boston, MA 02108 (soc. sec. num. 
000-00-0000) request under the provisions of the Privacy Act of 1974, 
that the following system of records be examined and that I be granted 
access in person to inspect any record (or a specified record) contained 
therein pertaining to me. I have enclosed the necessary identification.

System Name:
System Location:
Designated Official:

________________________________________________________________________
                                                                John Doe

    (e) Processing a request for notification and access to records or a 
request for an accounting of disclosures. (i) If a request for 
notification and access (or request for an accounting of disclosures) 
omits any information which is essential to processing the request, the 
request will not be acted upon and the individual making the request 
will be promptly advised of the additional information which must be 
submitted before the request can be processed.
    (ii) Within 30 days (not including Saturdays, Sundays, and legal 
public holidays) after the receipt of a request for notification and 
access (or a request for an accounting of disclosures), to a particular 
system of records by the designated official for such system, a 
determination will be made as to whether the particular system of 
records is exempt from the notification and access provisions of the 
Privacy Act, and if such system is not exempt, whether it does or does 
not contain a record pertaining to the individual making the request. If 
a determination cannot be made within 30 days, the individual will be 
notified of the delay, the reasons therefor, and the approximate time 
required to make a determination. If it is determined by the designated 
official that the particular system of records is exempt from the 
notification and access provisions of the Privacy Act, the individual 
making the request will be notified of the provisions of the Privacy Act 
under which the exemption is claimed. On the other hand, if it is 
determined by the designated official that the particular system of 
records is not exempted from the notification and access provisions of 
the Privacy Act and that such system contains a record pertaining to the 
individual

[[Page 71]]

making the request, the individual will be notified of the time and 
place where inspection may be made. If an individual has not requested 
that access be granted to inspect the record in person, but merely 
requests that a copy of the record be furnished, or if it is determined 
by the designated official that the granting of access to inspect a 
record in person is not feasible in a particular case, then the 
designated official will furnish a copy of the record with the 
notification, or if a copy cannot be furnished at such time, a statement 
indicating the approximate time such copy will be furnished. If the 
request is for an accounting of disclosures from a system of records 
which is not exempt from the accounting of disclosure provisions of the 
Privacy Act, the individual will be furnished with an accounting of such 
disclosures.
    (f) Granting of access. Normally, an individual will be granted 
access to inspect a record in person within 30 days (excluding 
Saturdays, Sundays, and legal public holidays) after the receipt for a 
request for notification and access by the designated official. If 
access cannot be granted within 30 days, the notification will state the 
reasons for the delay and the approximate time such access will be 
granted. An individual wishing to inspect a record may be accompanied by 
another person of his choosing. Both the individual seeking access and 
the individual accompanying him may be required to sign a form supplied 
by the IRS indicating that the Service is authorized to disclose or 
discuss the contents of the record in the presence of both individuals. 
See 26 CFR 601.502 for requirements to be met by taxpayer's 
representatives in order to discuss the contents of any tax records.
    (g) Medical records. When access is requested to medical records 
(including psychological records), the designated official may determine 
that release of such records will be made only to a physician designated 
by the individual to have access to such records.
    (h) Verification of identity. An individual seeking notification or 
access to records, or seeking to amend a record, must satisfy one of the 
following identification requirements before action will be taken by the 
IRS on any such request:
    (i) An individual seeking notification or access to records in 
person, or seeking to amend a record in person, may establish identity 
by the presentation of a single document bearing a photograph (such as a 
passport or identification badge) or by the presentation of two items of 
identification which do not bear a photograph but do bear both a name 
and signature (such as a driver's license or credit card).
    (ii) An individual seeking notification or access to records by 
mail, or seeking to amend a record by mail, may establish identity by a 
signature, address, and one other identifier such as a photocopy of a 
driver's license or other document bearing the individual's signature.
    (iii) Notwithstanding subdivisions (i) and (ii) of this 
subparagraph, an individual seeking notification or access to records by 
mail or in person, or seeking to amend a record by mail or in person, 
who so desires, may establish identity by providing a notarized 
statement, swearing or affirming to such individual's identity and to 
the fact that the individual understands the penalties provided in 5 
U.S.C. 552a(i)(3) for requesting or obtaining access to records under 
false pretenses.
    (iv) Notwithstanding subdivisions (i), (ii), or (iii) of this 
subparagraph, a designated official may require additional proof of an 
individual's identity before action will be taken on any request if such 
official determines that it is necessary to protect unauthorized 
disclosure of information in a particular case. In addition, a parent of 
any minor or a legal guardian of any individual will be required to 
provide adequate proof of legal relationship before such person may act 
on behalf of such minor or such individual.
    (i) Fees. The fee for costs required of the IRS in copying records 
pursuant to this paragraph is $0.15 per page. However, no fee will be 
charged if the aggregate costs required of the IRS in copying records is 
less than $3.00. If an individual who has requested access to inspect a 
record in person is denied such access by the designated official 
because it would not be feasible in a particular case, copies of such 
record will be furnished to the individual without payment of the fees 
otherwise required under this subparagraph. If the IRS estimates that 
the total fees for costs incurred in complying with a request for copies 
of records will amount to $50 or more, the individual making the request 
may be required to enter into a contract for the payment of the actual 
fees with respect to the request before the Service will furnish the 
copies requested. Payment of fees for copies of records should be made 
by check or money order payable to the Internal Revenue Service.
    4. Procedures for amendment of records. (a) In general. This 
paragraph sets forth the procedures for reviewing a request from an 
individual concerning the amendment of any record or information 
pertaining to such individual, for making a determination on the 
request, for making an appeal within the IRS of an initial adverse 
determination, and for judicial review of a final determination.
    (b) Amendment of record. Under 5 U.S.C. 552a(d)(2), an individual 
who has been granted access to a record pertaining to such individual 
may, after inspecting the record, request that the record be amended to 
make any correction of any portion thereof which

[[Page 72]]

the individual believes is not accurate, relevant, timely, or complete. 
An individual may seek to amend a record in accordance with the rules 
provided in paragraph (d)(3) of this section. See paragraph (b) of this 
section for prohibition against amendment of tax records.
    (c) Form of request for amendment of record. (i) A request for 
amendment of a record shall be in writing and shall be signed by the 
individual making the request.
    (ii) Such request shall be clearly marked ``Request for amendment of 
record.''
    (iii) Such request shall contain a statement that it is being made 
under the provisions of the Privacy Act of 1974.
    (iv) Such request shall contain the name and address of the 
individual making the request. In addition, if a particular system 
employs an individual's social security number as an essential means of 
accessing the system, the request must include the individual's social 
security number. In the case of a record maintained in the name of two 
or more individuals (e.g., husband and wife), the request shall contain 
the names, addresses, and social security numbers (if necessary) of both 
individuals.
    (v) Such request shall specify the name and location of the system 
of records (as set forth in the Notice of Systems) in which such record 
is maintained, and the title and business address of the official 
designated in the access section for such system (as set forth in the 
Notice of Systems).
    (vi) Such request shall specify the particular record in the system 
which the individual is seeking to amend.
    (vii) Such request shall clearly state the specific changes which 
the individual wishes to make in the record and a concise explanation of 
the reasons for the changes. If the individual wishes to correct or add 
any information, the request shall contain specific language making the 
desired correction or addition.
    (d) Time and place for making request. A request to amend a record 
under the Privacy Act shall be addressed to or delivered in person to 
the office of the official designated in the access section for the 
particular system of records. The title and office address of such 
official is set forth for each system of records in the Notice of 
Systems of Records. A request delivered to an office in person must be 
delivered during the regular office hours of that office.
    (e) Processing a request for amendment of a record. (i) Within 10 
days (not including Saturdays, Sundays, and legal public holidays) after 
the receipt of a request to amend a record by the designated official, 
the individual will be sent a written acknowledgement that will state 
that the request has been received, that action is being taken thereon, 
and that the individual will be notified within 30 days (not including 
Saturdays, Sundays, and legal public holidays) after the receipt of the 
request whether the requested amendments will or will not be made. If a 
request for amendment of a record omits any information which is 
essential to processing the request, the request will not be acted upon 
and the individual making the request will be promptly advised on the 
additional information which must be submitted before the request can be 
processed.
    (ii) Within 30 days (not including Saturdays, Sundays, and legal 
public holidays) after the receipt of a request to amend a record by the 
designated official, a determination will be made as to whether to grant 
the request in whole or part. The individual will then be notified in 
writing of the determination. If a determination cannot be made within 
30 days, the individual will be notified in writing within such time of 
the reasons for the delay and the approximate time required to make a 
determination. If it is determined by the designated official that the 
request will be granted, the requested changes will be made in the 
record and the individual will be notified of the changes. In addition, 
to the extent an accounting was maintained, all prior recipients of such 
record will be notified of the changes. Upon request, an individual will 
be furnished with a copy of the record, as amended, subject to the 
payment of the appropriate fees. On the other hand, if it is determined 
by the designated official that the request, or any portion thereof, 
will not be granted, the individual will be notified in writing of the 
adverse determination. The notification of an adverse determination will 
set forth the reasons for refusal to amend the record. In addition, the 
notification will contain a statement informing the individual of such 
individual's right to request an independent review of the adverse 
determination by a reviewing officer in the national office of the IRS 
and the procedures for requesting such a review.
    (f) Administrative review of adverse determination. Under 5 U.S.C. 
552a (d)(3), an individual who disagrees with the refusal of the agency 
to amend a record may, within 35 days of being notified of the adverse 
determination, request an independent review of such refusal by a 
reviewing officer in the national office of the IRS. The reviewing 
officer for the IRS is the Commission of Internal Revenue, the Deputy 
Commissioner, or an Assistant Commissioner. In the case of an adverse 
determination relating to a system of records maintained by the Office 
of General Counsel for the IRS, the reviewing officer is the Chief 
Counsel or his delegate. An individual seeking a review of an adverse 
determination shall make a request for review in accordance with the 
rules provided in paragraph (d)(7) of this section.
    (g) Form of request for review. (i) A request for review of an 
adverse determination shall

[[Page 73]]

be in writing and shall be signed by the individual making the request.
    (ii) Such request shall be clearly marked ``Request for review of 
adverse determination''.
    (iii) Such request shall contain a statement that it is being made 
under the provisions of the Privacy Act of 1974.
    (iv) Such request shall contain the name and address of the 
individual making the request. In addition, if a particular system 
employs an individual's social security number as an essential means of 
accessing the system, the request must include the individual's social 
security number. In the case of a record maintained in the name of two 
or more individuals (e.g. husband and wife), the request shall contain 
the names, addresses, and social security numbers (if necessary) of both 
individuals.
    (v) Such request shall specify the particular record which the 
individual is seeking to amend, the name and location of the system of 
records (as set forth in the Notice of Systems) in which such record is 
maintained, and the title and business address of the designated 
official for such system (as set forth in the Notice of Systems).
    (vi) Such request shall include the date of the initial request for 
amendment of the record, and the date of the letter notifying the 
individual of the initial adverse determination with respect to such 
request.
    (vii) such request shall clearly state the specific changes which 
the individual wishes to make in the record and a concise explanation of 
the reasons for the changes. If the individual wishes to correct or add 
any information, the request shall contain specific language making the 
desired correction or addition.
    (h) Time and place for making the request. A request for review of 
an adverse determination under the Privacy Act shall be addressed to or 
delivered in person to the Director, Office of Disclosure, Attention: 
OP:EX:D Internal Revenue Service, 1111 Constitution Avenue, NW, 
Washington, DC 20224. A request for review of an adverse determination 
will be promptly referred by the Director, Office of Disclosure to the 
appropriate reviewing officer for his review and final determination.
    (i) Processing a request for review of adverse determination. Within 
30 days (not including Saturdays, Sundays, and legal public holidays) 
after the receipt of a request for review of an adverse determination by 
the appropriate reviewing officer, the reviewing officer will review the 
initial adverse determination, make a final determination whether to 
grant the request to amend the record in whole or in part, and notify 
the individual in writing of the final determination. If a final 
determination cannot be made within 30 days, the Commissioner of 
Internal Revenue may extend such 30-day period. The individual will be 
notified in writing within the 30 day period of the cause for the delay 
and the approximate time required to make a final determination. If it 
is determined by the reviewing officer that the request to amend the 
record will be granted, the reviewing officer will cause the requested 
changes to be made and the individual will be so notified. Upon request, 
an individual will be furnished with a copy of the record as amended 
subject to the payment of appropriate fees. On the other hand, if it is 
determined by the reviewing officer that the request to amend the 
record, or any portion thereof, will not be granted, the individual will 
be notified in writing of the final adverse determination. The 
notification of a final adverse determination will set forth the reasons 
for the refusal of the reviewing officer to amend the record. The 
notification shall include a statement informing the individual of the 
right to submit a concise statement for insertion in the record setting 
forth the reasons for the disagreement with the refusal of the reviewing 
officer to amend the record. In addition, the notification will contain 
a statement informing the individual of the right to seek judicial 
review by a United States district court of a final adverse 
determination.
    (j) Statement of disagreement. Under 5 U.S.C. 552a (d)(3), an 
individual who disagrees with a final adverse determination not to amend 
a record subject to amendment under the Privacy Act may submit a concise 
statement for insertion in the record setting forth the reasons for 
disagreement with the refusal of the reviewing officer to amend the 
record. A statement of disagreement should be addressed to or delivered 
in person to the Director, Office of Disclosure, Attention: OP:EX:D, 
Internal Revenue Service, 1111 Constitution Avenue, NW, Washington, DC 
20224. The Director, Office of Disclosure will foward the statement of 
disagreement to the appropriate designated official who will cause the 
statement to be inserted in the individual's record. Any such statement 
will be available to anyone to whom the record is subsequently disclosed 
and the prior recipients of the record will be provided with a copy of 
the statement of disagreement, to the extent an accounting of 
disclosures was maintained.
    (k) Judicial review. If, after a review and final determination on a 
request to amend a record by the appropriate reviewing officer, the 
individual is notified that the request will not be granted, or if, 
after the expiration of 30 days (not including Sundays, Saturdays, and 
legal public holidays) from the receipt of such request by the Director, 
Disclosure Operations Division, action is not taken thereon in 
accordance with the requirements of paragraph (d)(9) of this section, an 
individual may commence an action within the time prescribed by law in a 
U.S.

[[Page 74]]

District Court pursuant to 5 U.S.C. 552a (g)(1). The statute authorizes 
an action only against the agency. With respect to records maintained by 
the IRS, the agency is the Internal Revenue Service, not an officer or 
employee thereof. Service of process in such an action shall be in 
accordance with the Federal Rules of Civil Procedure (28 U.S.C. App.) 
applicable to actions against an agency of the United States. Where 
provided in such Rules, delivery of process upon the IRS must be 
directed to the Commissioner of Internal Revenue, Attention: CC:GLS, 
1111 Constitution Avenue, NW, Washington, DC 20224. The district court 
will determine the matter de novo.
    5. Records transferred to Federal Records Centers. Records 
transferred to the Administrator of General Services for storage in a 
Federal Records Center are not used by the Internal Revenue Service in 
making any determination about any individual while stored at such 
location and therefore are not subject to the provisions of 5 U.S.C. 
552a (e)(5) during such time.

    Appendix C to Subpart C of Part 1--United States Customs Service

    1. In general. This appendix applies to the United States Customs 
Service. It sets forth specific notification and access procedures with 
respect to particular systems of records, identifies the officer 
designated to make the initial determinations with respect to 
notification and access to records and accountings of disclosures of 
records. This appendix also sets forth the specific procedures for 
requesting amendment of records and identifies the officers designated 
to make the initial and appellate determinations with respect to 
requests for amendment of records. It identifies the officers designated 
to grant extensions of time on appeal, the officers with whom 
``Statements of Disagreement may be filed, the officer designated to 
receive service of process and the addresses for delivery of requests, 
appeals, and service of process. In addition, it references the notice 
of systems of records and notices of the routine uses of the information 
in the system required by 5 U.S.C. 552a(e) (4) and (11) and published 
annually by the Office of the Federal Register in ``Privacy Act 
Issuances''.
    2. Requests for notification and access to records and accounting of 
disclosures. (a) For records which are maintained at the United States 
Customs Service Headquarters, initial requests for notification and 
access to records and accountings of disclosures under 31 CFR 1.26, 
should be mailed or personally delivered to the Director, Office of 
Regulations & Rulings, U.S. Customs Service, 1301 Constitution Avenue 
NW., Washington, DC 20229. The official who has authority over the 
maintenance of the file will have the authority to grant or deny the 
request.
    (b) For records maintained at Regional Offices, initial requests for 
notification and access to records and accountings of disclosures under 
31 CFR 1.26, should be mailed or personally delivered to the Regional 
Commissioner of Customs in whose region the records are located. This 
official shall have the authority to grant the request or deny the 
request. The appropriate location of the regional offices is specified 
in Customs Appendix A in ``Privacy Act Issuances'' published annually by 
the Office of the Federal Register.
    (c) Each request shall comply with the identification and other 
requirements set forth in 31 CFR 1.26, and in the appropriate system 
notice in the ``Privacy Act Issuances'' published annually by the Office 
of the Federal Register. Each request should be conspicuously labeled on 
the face of the envelope ``Privacy Act Request''.
    3. Request for amendment of records. (a) For records which are 
maintained at Customs Service Headquarters, initial requests for 
amendment of records under 31 CFR 1.27 (a) through (d) should be mailed 
or personally delivered to the Director, Office of Regulations & 
Rulings, U.S. Customs Service, 1301 Constitution Avenue NW., Washington, 
DC 20229. The official who has authority over the maintenance of the 
file will have the authority to grant or deny the request.
    (b) For records not maintained at Customs Service Headquarters, 
initial requests for amendment of records under 31 CFR 1.27 (a) through 
(d) should be mailed or personally delivered to the Regional 
Commissioner of Customs in whose region the records are located. This 
official shall have the authority to grant or deny the request. A 
request directed to a Regional Commissioner should be mailed to or 
personally delivered at the appropriate location specified in Customs 
Appendix A in ``Privacy Act Issuances'' published annually by the Office 
of the Federal Register.
    (c) Each request shall comply with the identification and other 
requirements set forth in 31 CFR 1.27, and in the appropriate system 
notice in ``Privacy Act Issuance published by the Office of the Federal 
Register. Each request should be conspicuously labeled on the face of 
the envelope ``Privacy Act Amendment Request''.
    4. Administrative appeal of initial determination refusing to amend 
records. Appellate determinations (including extensions of time on 
appeal under 31 CFR 1.27 (e) with respect to all Customs Service records 
will be made by the Director, Office of Regulations & Rulings or the 
delegate of such official. All such appeals should be mailed or 
personally delivered to the United States Customs Service, Office of 
Regulations & Rulings, 1301 Constitution Avenue NW., Washington, DC 
20229. Each appeal should be conspicuously labeled

[[Page 75]]

on the face of the envelope ``Privacy Act Amendment Appeal''.
    5. Statements of disagreement. ``Statements of Disagreement'' 
pursuant to 31 CFR 1.27 (e)(4)(i) shall be filed with the official 
signing the notification of refusal to amend at the address indicated in 
the letter of notification within 35 days of the date of such 
notification and should be limited to one page.
    6. Service of process. Service of process will be received by the 
Chief Counsel, United States Customs Service, 1301 Constitution Avenue 
NW., Washington, DC 20229.
    7. Annual notice of systems of records. The annual notice of the 
United States Customs Service systems of records required to be 
published by the Office of the Federal Register, as specified in 5 
U.S.C. 552a(f), is included in the publication entitled ``Privacy Act 
Issuances''.
    8. Verification of identity. Each request shall comply with the 
identification and other requirements set forth in 31 CFR 1.26 and in 
the appropriate system notice published by the Office of the Federal 
Register. Each request should be conspicuously labeled on the face of 
the envelope ``Privacy Act Request''.

     Appendix D to Subpart C of Part 1--United States Secret Service

    1. In general. This appendix applies to the United States Secret 
Service. It sets forth specific notification and access procedures with 
respect to particular systems of records including identification 
requirements, and time and places where records may be reviewed; 
identifies the officers designated to make the initial determinations 
with respect to notification and access to records and accountings of 
disclosures of records. This appendix also sets forth the specific 
procedures for requesting amendment of records and identifies the 
officers designated to make the initial and appellate determinations 
with respect to requests for amendment of records. It identifies the 
officers designated to grant extensions of time on appeal, the officers 
with whom ``Statements of Disagreement may be filed, the officer 
designated to receive service of process and the addresses for delivery 
of requests, appeals, and service of process. In addition, it references 
the notice of systems of records and notices of the routine uses of the 
information in the system required by 5 U.S.C. 552a(e) (4) and (11) and 
published annually by the Office of the Federal Register in ``Privacy 
Act Issuances''.
    2. Requests for notification and access to records and accountings 
of disclosures. Initial determinations under 31 CFR 1.26, whether to 
grant requests for notification and access to records and accountings of 
disclosures for the United States Secret Service, will be made by the 
Freedom of Information and Privacy Act Officer, United States Secret 
Service. Requests for notification should be made by mail or delivered 
personally between the hours of 9:00 a.m. and 5:30 of any day excluding 
Saturdays, Sundays, and legal holidays to: Privacy Act Request, Freedom 
of Information and Privacy Act Officer, United States Secret Service, 
Suite 3000, 950 H Street, NW., Washington, DC 20373-5802.
    a. Identification requirements. In addition to the requirements 
specified in 31 CFR 1.26, each request for notification, access or 
amendment of records made by mail shall contain the requesting 
individual's date and place of birth and a duly notarized statement 
signed by the requester asserting his or her identity and stipulating 
that the requesting individual understands that knowingly or willfully 
seeking or obtaining access to records about another person under false 
pretences is punishable by a fine of up to $5,000.
    b. Individuals making requests in person. Individuals making 
requests in person will be required to exhibit acceptable identifying 
documents such as employee identification numbers, drivers licenses, 
medical cards or other documents sufficient to verify the identity of 
the requester.
    c. Physical inspection of records. Upon determining that a request 
for the physical inspection of records is to be granted, the requester 
shall be notified in writing of the determination, and when and where 
the requested records may be inspected. The inspection of records will 
be conducted at the Secret Service field office or other facility 
located nearest to the residence of the individual making the request. 
Such inspection shall be conducted during the regular business hours of 
the Secret Service Field Office or other facility where the disclosure 
is made. A person of his or her own choosing may accompany the 
individual making the request provided the individual furnishes a 
written statement authorizing the disclosure of that individual's record 
in the accompanying person's presence. Any disclosure of a record will 
be made in the presence of a representative of the United States Secret 
Service.
    3. Requests for amendment of records. Initial determination under 31 
CFR part 1, whether to grant requests to amend records will be made by 
the Freedom of Information and Privacy Act Officer. Requests should be 
mailed or delivered personally between the hours of 9:00 a.m. and 5:30 
p.m. to: Privacy Act Amendment Request, Freedom of Information and 
Privacy Acts Officer, United States Secret Service, Suite 3000, 950 H 
Street, NW., Washington, DC 20373-5802.
    4. Administrative appeal of initial determinations refusing 
amendment of records. Appellate determinations, including extensions of 
time on appeal, with respect to records of the United States Secret 
Service will be made by the Deputy Director, United States Secret 
Service. Appeals may be mailed or delivered

[[Page 76]]

personally to: Privacy Act Amendment Appeal, Deputy Director, United 
States Secret Service, 950 H Street, NW., Suite 8300, Washington, DC 
20373-5802.
    5. Statements of disagreement. ``Statements of Disagreements'' under 
31 CFR 1.27 (e)(4)(i) shall be filed with the official signing of the 
notification of refusal to amend at the address indicated in the letter 
of notification within 35 days of the date of such notification and 
should be limited to one page.
    6. Service of process. Service of process will be received by the 
United States Secret Service General Counsel and shall be delivered to 
the following location: General Counsel, United States Secret Service, 
Suite 8300, 950 H Street, NW., Washington, DC 20373-5802.
    7. Annual notice of systems of records. The annual notice of systems 
of records is published by the Office of the Federal Register, as 
specified in 5 U.S.C. 552a(f). The publication is entitled ``Privacy Act 
Issuances''. Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26 and 1.27 are indicated in the notice for the pertinent 
system.

[52 FR 26305, July 14, 1987, as amended at 66 FR 9959, Feb. 13, 2001]

   Appendix E to Subpart C of Part 1--Bureau of Alcohol, Tobacco and 
                                Firearms

    1. In general. This appendix applies to the Bureau of Alcohol, 
Tobacco and Firearms. It sets forth specific notification and access 
procedures with respect to particular systems of records, identifies the 
officers designated to make the initial determinations with respect to 
notification and access to records and accountings of disclosures of 
records. This appendix also sets forth the specific procedures for 
requesting amendment of records and identifies the officers designated 
to make the initial and appellate determinations with respect to 
requests for amendment of records. It identifies the officers designated 
to grant extensions of time on appeal, the officers with whom 
``Statements of Disagreement'' may be filed, the officer designated to 
receive service of process and the addresses for delivery of requests, 
appeals, and service of process. In addition, it references the notice 
of systems of records and notices of the routine uses of the information 
in the system required by 5 U.S.C. 552a (3) (4) and (11) and published 
annually by the Office of the Federal Register in ``Privacy Act 
Issuances''.
    2. Requests for notification and access to records and accountings 
of disclosures. Initial determination under 31 CFR 1.26, whether to 
grant requests for notification and access to records and accountings of 
disclosures for the Bureau of Alcohol, Tobacco, and Firearms, will be 
made by the Chief, Disclosure Branch, Office of the Assistant to the 
Director or the delegate of such officer. Requests may be mailed or 
delivered in person to: Privacy Act Request, Chief, Disclosure Branch, 
Room 4406, Bureau of Alcohol, Tobacco and Firearms, 1200 Pennsylvania 
Avenue, NW., Washington, DC 20226.
    3. Requests for amendment of record. Initial determinations under 31 
CFR 1.27 (a) through (d) with respect to requests to amend records 
maintained by the Bureau of Alcohol, Tobacco and Firearms will be made 
by the Chief, Disclosure Branch, Office of the Assistant to the 
Director. Requests for amendment of records may be mailed or delivered 
in person to: Privacy Act Request, Chief, Disclosure Branch, Room 4406, 
Bureau of Alcohol, Tobacco and Firearms, 1200 Pennsylvania Avenue, NW., 
Washington, DC 20226.
    4. Verification of identity. (a) In addition to the requirements 
specified in 31 CFR 1.26(d) of this appendix, each request for 
notification, access or amendment of records made by mail shall contain 
the requesting individual's date and place of birth and a statement 
signed by the requester asserting his or her identity and stipulating 
that the requester understands that knowingly or willfully seeking or 
obtaining access to records about another person under false pretenses 
is a misdemeanor and punishable by a fine of up to $5,000 provided, that 
the Bureau of Alcohol, Tobacco and Firearms may require a signed 
notarized statement verifying the identity of the requester.
    (b) Individuals making requests in person will be required to 
exhibit at least two acceptable identifying documents such as employee 
identification cards, driver's license, medical cards, or other 
documents sufficient to verify the identity of the requester.
    (c) The parent or guardian of a minor or a person judicially 
determined to be incompetent, shall in addition to establishing the 
identity of the minor or other person he represents as required in (a) 
and (b), establish his own parentage or guardianship by furnishing a 
copy of a birth certificate showing parentage (or other satisfactory 
documentation) or a court order establishing the guardianship.
    5. Request for physical inspection of records. Upon determining that 
a request for the physical inspection of records is to be granted, the 
requester shall be notified in writing of the determination, and when 
and where the records may be inspected. The inspection of records will 
be made at the Bureau of Alcohol, Tobacco and Firearms Field Office or 
other facility located nearest to the residence of the individual making 
the request. Such inspection shall be conducted during the regular 
business hours of the field office or other facility where the 
disclosure is made. A person of the requester's own choosing may 
accompany the requester provided

[[Page 77]]

the requester furnishes a written statement authorizing the disclosure 
of the requester's record in the accompanying person's presence. The 
record inspection will be made in the presence of a representative of 
the Bureau. Following the inspection of the record, the individual will 
acknowledge in writing the fact that he or she had an opportunity to 
inspect the requested record.
    6. Requests for copies of records without prior physical inspection. 
Upon determining that an individual's request for copies of his or her 
records without prior physical inspection is to be granted, the 
requester shall be notified in writing of the determination, and the 
location and time for his or her receipt of the requested copies. The 
copies will be made available at the Bureau of Alcohol, Tobacco and 
Firearms field office or other facility located nearest to the residence 
of the individual making the request. Copies shall be received by the 
requester during the regular business hours of the field office or other 
facility where the disclosure is made. Transfer of the copies to the 
individual shall be conditioned upon payment of copying costs and his 
presentation of at least two acceptable identifying documents such as 
employee identification cards, driver's license, medical cards, or other 
documents sufficient to verify the identity of the requester. Following 
the receipt of the copies, the individual will acknowledge receipt in 
writing.
    7. Administrative appeal of initial determination refusing to amend 
record. Appellate determinations under 31 CFR 1.27(e) with respect to 
records of the Bureau of Alcohol, Tobacco and Firearms, including 
extensions of time on appeal, will be made by the Director or the 
delegate of such officer. Appeals should be addressed to, or delivered 
in person to: Privacy Act Amendment Appeal, Director, Bureau of Alcohol, 
Tobacco and Firearms, Room 4406, 1200 Pennsylvania Avenue, NW., 
Washington, DC 20226.
    8. Statements of disagreement. ``Statements of Disagreement'' as 
described in 31 CFR 1.27(e) (4) shall be filed with the official signing 
the notification within 35 days of the date of such notification and 
should be limited to one page.
    9. Service of process. Service of process will be received by the 
Director of the Bureau of Alcohol, Tobacco and Firearms or the delegate 
of such official and shall be delivered to the following location: 
Director, Bureau of Alcohol, Tobacco and Firearms, 1200 Pennsylvania 
Avenue, NW., Washington, DC 20226, Attention: Chief Counsel.
    10. Annual notice of systems of records. The annual notice of 
systems of records is published by the Office of the Federal Register, 
as specified in 5 U.S.C. 552a(f). The publication is entitled ``Privacy 
Act Issuances''. Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26 and 1.27 are indicated in the notice for each pertinent 
system.

   Appendix F to Subpart C of Part 1--Bureau of Engraving and Printing

    1. In general. This appendix applies to the Bureau of Engraving and 
Printing. It sets forth specific notification and access procedures with 
respect to particular systems of records including identification 
requirements, identifies the officers designated to make the initial 
determinations with respect to notification and access to records and 
accountings of disclosures of records. This appendix also sets forth the 
specific procedures for requesting amendment of records and identifies 
the officers designated to make the initial and appellate determinations 
with respect to requests for amendment of records. It identifies the 
officers designated to grant extensions of time on appeal, the officers 
with whom ``Statements of Disagreement may be filed, the officer 
designated to receive service of process and the addresses for delivery 
of requests, appeals, and service of process. In addition, it references 
the notice of systems of records and notices of the routine uses of the 
information in the system required by 5 U.S.C. 552a (e) (4) and (11) and 
published annually by the Office of the Federal Register in ``Privacy 
Act Issuances.''
    2. Requests for notification and access to records and accountings 
of disclosures. Initial determinations under 31 CFR 1.26, whether to 
grant requests for notification and access to records and accountings of 
disclosures for the Bureau of Engraving and Printing, will be made by 
the head of the organizational unit having immediate custody of the 
records requested, or the delegate of such official. Requests for access 
to records contained within a particular system of records should be 
submitted to the address indicated for that system in the access section 
of the notices published by the Office of the Federal Register in 
``Privacy Act Issuances.'' Requests for information and specific 
guidance should be addressed to: Privacy Act Request, Disclosure Officer 
(Executive Assistant to the Director), Room 104--18M, Bureau of 
Engraving and Printing, Washington, DC 20228.
    3. Requests for amendment of records. Initial determination under 31 
CFR 1.27 (a) through (d), whether to grant request to amend records will 
be made by the head of the organizational unit having immediate custody 
of the records or the delegate of such official. Requests for amendment 
should be addressed as indicated in the appropriate system notice in 
``Privacy Act Issuances'' published by the Office of the Federal 
Register. Requests for information and specific guidance on where to 
send requests for amendment should be

[[Page 78]]

addressed to: Privacy Act Amendment Request, Disclosure Officer 
(Executive Assistant to the Director), Bureau of Engraving and Printing, 
Room 104-18M, Washington, DC 20228.
    4. Administrative appeal of initial determinations refusing 
amendment of records. Appellate determinations refusing amendment of 
records under 31 CFR 1.27(e) including extensions of time on appeal, 
with respect to records of the Bureau of Engraving and Printing will be 
made by the Director of the Bureau or the delegate of such officer. 
Appeals made by mail should be addressed to, or delivered personally to: 
Privacy Act Amendment Appeal, Disclosure Officer (Executive Assistant to 
the Director), Room 104-18M, Bureau of Engraving and Printing, 
Washington, DC 20228.
    5. Statements of disagreement. ``Statements of Disagreement'' under 
31 CFR 1.27(e)(4)(8) shall be filed with the official signing the 
notification of refusal to amend at the address indicated in the letter 
of notification within 35 days of the date of such notification and 
should be limited to one page.
    6. Service of process. Service of process will be received by the 
Chief Counsel of the Bureau of Engraving and Printing and shall be 
delivered to the following location: Chief Counsel, Bureau of Engraving 
and Printing, Room 109-M, 14th and C Streets, SW., Washington, DC 20228.
    7. Verification of identity. An individual seeking notification or 
access to records, or seeking to amend a record, or seeking an 
accounting of disclosures, must satisfy one of the following 
identification requirements before action will be taken by the Bureau of 
Engraving and Printing on any such request:
    (i) An individual appearing in person may establish identity by the 
presentation of a single document bearing a photograph (such as a 
passport or identification badge) or by the presentation of two items of 
identification which do not bear a photograph, but do bear both a name 
and signature (such as a credit card).
    (ii) An individual may establish identity through the mail by a 
signature, address, and one other identifier such as a photocopy of a 
driver's license or other document bearing the individual's signature.
    (iii) Notwithstanding subdivisions (i) and (ii) of this 
subparagraph, an individual who so desires, may establish identity by 
providing a notarized statement, swearing or affirming to such 
individual's identity and to the fact that the individual understands 
the penalties provided in 5 U.S.C. 552a(1)(3) for requesting or 
obtaining access to records under false pretenses.
    Notwithstanding subdivision (i), (ii), or (iii) of this 
subparagraph, the Executive Assistant or other designated official may 
require additional proof of an individual's identity before action will 
be taken on any request if such official determines that it is necessary 
to protect against unauthorized disclosure of information in a 
particular case. In addition, a parent of any minor or a legal guardian 
of any individual will be required to provide adequate proof of legal 
relationship before such person may act on behalf of such minor or such 
individual.
    8. Annual notice of systems of records. The annual notice of systems 
of records is published by the Office of the Federal Register, as 
specified in 5 U.S.C. 522a(f). The publication is entitled ``Privacy Act 
Issuances''. Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26 and 1.27 are indicated in the notice for the pertinent 
system.

     Appendix G to Subpart C of Part 1--Financial Management Service

    1. In general. This appendix applies to the Financial Management 
Service. It sets forth specific notification and access procedures with 
respect to particular systems of records, identifies the officers 
designated to make the initial determinations with respect to 
notification and access to records and accountings of disclosures of 
records. This appendix also sets forth the specific procedures for 
requesting amendment of records and identifies the officers designated 
to make the initial and appellate determinations with respect to 
requests for amendment of records. It identifies the officers designated 
to grant extensions of time on appeal, the officers with whom 
``Statements of Disagreement'' may be filed, the officer designated to 
receive service of process and the addresses for delivery of requests, 
appeals, and service of process. In addition, it references the notice 
of systems of records and notices of the routine uses of the information 
in the system required by 5 U.S.C. 552a(e) (4) and (11) and published 
annually by the Office of the Federal Register in ``Privacy Act 
Issuances''.
    2. Requests for notification and access to records and accountings 
of disclosures. Initial determinations under 31 CFR 1.26, whether to 
grant requests for notification and access to records and accountings of 
disclosures for the Financial Management Service, will be made by the 
head of the organizational unit having immediate custody of the records 
requested or an official designated by this official. This is indicated 
in the appropriate system notice in ``Privacy Act Issuances'' published 
annually by the Office of the Federal Register. Requests for information 
and specific guidance on where to send requests for records may be 
mailed or delivered personally to: Privacy Act Request, Disclosure 
Officer, Financial Management Service, Room 108, Treasury Department 
Annex No. 1, Pennsylvania Avenue and Madison Place, NW., Washington, DC 
20226.

[[Page 79]]

    3. Requests for amendment of records. Initial determination under 31 
CFR 1.27(a) through (d), whether to grant requests to amend records will 
be made by the head of the organzational unit having immediate custody 
of the records or the delegate of such official. Requests for amendment 
should be addressed as indicated in the appropriate system notice in 
``Privacy Act Issuances'' published by the Office of the Federal 
Register. Requests for information and specific guidance on where to 
send requests for amendment should be addressed to: Privacy Act 
Amendment Request, Disclosure Officer, Financial Management Service, 
Department of the Treasury, Treasury Annex No. 1, Washington, DC 20226.
    4. Administrative appeal of initial determinations refusing 
amendment of records. Appellate determinations refusing amendment of 
records under 31 CFR 1.27(e) incuding extensions of time on appeal, with 
respect to records of the Financial Management Service will be made by 
the Commissioner or the delegate of such official. Appeals made by mail 
should be addressed to, or delivered personally to: Privacy Act 
Amendment Appeal Commissioner, Financial Management Service (Privacy), 
Department of the Treasury, Room 618, Treasury Annex No. 1, Pennsylvania 
Avenue and Madison Place, NW., Washington, DC 20226.
    5. Statements of disagreement. ``Statements of Disagreement'' under 
31 CFR 1.27(e)(4)(i) shall be filed with the official signing the 
notification of refusal to amend at the address indicated in the letter 
of notification within 35 days of the date of such notification and 
should be limited to one page.
    6. Service of process. Service of process will be received by the 
Commissioner, Financial Management Service or the delegate of such 
official and shall be delivered to the following location: Commissioner, 
Financial Management Service (Privacy), Department of the Treasury, Room 
618, Treasury Annex No. 1, Pennsylvania Avenue and Madison Place, NW, 
Washington, DC 20226.
    7. Annual notice of systems of records. The annual notice of systems 
of records is published by the Office of the Federal Register, as 
specified in 5 U.S.C. 552a(f). The publication is entitled ``Privacy Act 
Issuances''. Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26 and 1.27 are indicated in the notice for the pertinent 
system.

          Appendix H to Subpart C of Part 1--United States Mint

    1. In general. This appendix applies to the United States Mint. It 
sets forth specific notification and access procedures with respect to 
particluar systems of records, identifies the officers designated to 
make the initial determinations with respect to notification and access 
to records and accountings of disclosures of records. This appendix also 
sets forth the specific procedures for requesting amendment of records 
and identifies the officers designated to make the initial and appellate 
determinations with respect to requests for amendment of records. It 
identifies the officers designated to grant extensions of time on 
appeal, the officers with whom ``Statements of Disagreement'' may be 
filed, the officer designated to receive service of process and the 
addresses for delivery of requests, appeals, and service of process. In 
addition, it references the notice of systems of records and notices of 
the routine uses of the information in the system required by 5 U.S.C. 
552a(e) (4) and (11) and published annually by the Office of the Federal 
Register in ``Privacy Act Issuances''.
    2. Requests for notification and access to records and accountings 
of disclosures. Initial determinations under 31 CFR 1.26, whether to 
grant requests for notification and access to records and accountings of 
disclosures for the United States Mint will be made by the head of the 
organizational unit having immediate custody of the records requested or 
an official designated by this official. This is indicated in the 
appropriate system notice in ``Privacy Act Issuances'' published 
annually by the Office of the Federal Register. Requests should be 
directed to the Superintendent or Officer in charge of the facility in 
which the records are located or to the Chief, Administrative Programs 
Division. Requests for information and specific guidance on where to 
send requests for records may be mailed or delivered personally to: 
Privacy Act Request, Chief, Administrative Programs Division, United 
States Mint, Judiciary Square Building, 633 3rd Street, N.W, Washington, 
DC 20220.
    3. Requests for amendment of records. Initial determination under 31 
CFR 1.27 (a) through (d), whether to grant requests to amend records 
will be made by the head of the Mint installation having immediate 
custody of the records or the delegated official. Requests should be 
mailed or delivered personally to: Privacy Act Amendment Request, 
Freedom of Information and Privacy Acts Officer, United States Mint, 
Judiciary Square Building, 633 3rd Street, Washington, DC 20220.
    4. Administrative appeal of initial determinations refusing 
amendment of records. Appellate determinations refusing amendment of 
records under 31 CFR 1.27 including extensions of time on appeal, with 
respect to records of the United States Mint will be made by the 
Director of the Mint or the delegate of the Director. Appeals made by 
mail should be addressed to, or delivered personally to: Privacy Act 
Amendment Appeal,

[[Page 80]]

United States Mint, Judiciary Square Building, 633 3rd Street, NW, 
Washington, DC 20220.
    5. Statements of disagreement. ``Statements of Disagreement'' under 
31 CFR 1.27 (e)(4)(i) shall be filed with the official signing the 
notification of refusal to amend at the address indicated in the letter 
of notification within 35 days of the date of such notification and 
should be limited to one page.
    6. Service of process. Service of process will be received by the 
Director of the Mint and shall be delivered to the following location: 
Director of the Mint, Judiciary Square Building, 633 3rd street, NW., 
Washington, DC 20220.
    7. Annual notice of systems of records. The annual notice of systems 
of records is published by the Office of the Federal Register, as 
specified in 5 U.S.C. 552a(f). The publication is entitled ``Privacy Act 
Issuances''. Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26 and 1.27 are indicated in the notice for the pertinent 
system.

      Appendix I to Subpart C of Part 1--Bureau of the Public Debt

    1. In general. This appendix applies to the Bureau of the Public 
Debt. It sets forth specific notification and access procedures with 
respect to particular systems of records, identifies the officers 
designated to make the initial determinations with respect to 
notification and access to records and accountings of disclosures of 
records. This appendix also sets forth the specific procedures for 
requesting amendment of records and identifies the officers designated 
to make the initial and appellate determinations with respect to 
requests for amendment of records. It identifies the officer designated 
to grant extension of time on appeal, the officers with whom 
``Statements of Disagreement'' may be filed, the officer designated to 
receive service of process and the addresses for delivery of requests, 
appeals, and service of process. In addition, it references the notice 
of systems of records and notices of the routine uses of the information 
in the system required by 5 U.S.C. 552a(e) (4) and (11) and published 
annually by the Office of the Federal Register in ``Privacy Act 
Issuances''.
    2. Requests for notification and access to records and accountings 
of disclosures. Initial determinations under 31 CFR 1.26, whether to 
grant requests for notification and access to records and accountings of 
disclosures for the Bureau of Public Debt, will be made by the head of 
the organizational unit having immediate custody of the records 
requested or an official designated by this official. This is indicated 
in the appropriate system notice in ``Privacy Act Issuances'' published 
annually by the Office of the Federal Register. Requests for information 
and specific guidance on where to send requests for records may be 
mailed or delivered personally to: Privacy Act Request, Disclosure 
Officer, Administrative Resource Center, Bureau of the Public Debt, 
Department of the Treasury, 200 Third Street, Room 211, Parkersburg, WV 
26101-5312.
    3. Requests for amendment of records. Initial determination under 31 
CFR 1.27 (a) through (d), whether to grant requests to amend records 
will be made by the head of the organizational unit having immediate 
custody of the records or the delegate of such official. Requests for 
amendment should be addressed as indicated in the appropriate system 
notice in ``Privacy Act Issuances'' published by the Office of the 
Federal Register. Requests for information and specific guidance on 
where to send requests for amendment should be addressed to: Privacy Act 
Amendment Request, Disclosure Officer, Administrative Resource Center, 
Bureau of the Public Debt, Department of the Treasury, 200 Third Street, 
Room 211, Parkersburg, WV 26101-5312.
    4. Administrative appeal of initial determinations refusing 
amendment of records. Appellate determinations refusing amendment of 
records under 31 CFR 1.27(e) including extensions of time on appeal, 
with respect to records of the Bureau of the Public Debt will be made by 
the Executive Director, Administrative Resource Center, Bureau of the 
Public Debt or the delegate of such officer. Appeals made by mail should 
be addressed to, or delivered personally to: Privacy Act Amendment 
Appeal, Chief Counsel, Bureau of the Public Debt, Department of the 
Treasury, Executive Director, Administrative Resource Center, Bureau of 
the Public Debt.
    5. Statements of disagreement. ``Statements of Disagreement'' under 
31 CFR 1.27 (e)(4)(i) shall be filed with the official signing the 
notification of refusal to amend at the address indicated in the letter 
of notification within 35 days of the date of such notification and 
should be limited to one page.
    6. Service of process. Service of process will be received by the 
Chief Counsel of the Bureau of the Public Debt and shall be delivered to 
the following location: Chief Counsel, Bureau of the Public Debt, 
Department of the Treasury, 200 Third Street, Room G-15, Parkersburg, WV 
26106-1328.
    7. Annual notice of systems of records. The annual notice of systems 
of records is published by the Office of the Federal Register, as 
specified in 5 U.S.C. 552a(f). The publication is entitled ``Privacy Act 
Issuances''. Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26 and 1.27 are indicated in the notice for the pertinent 
system.

[[Page 81]]

  Appendix J to Subpart C of Part 1--Office of the Comptroller of the 
                                Currency

    1. In general. This appendix applies to the Office of the 
Comptroller of the Currency. It sets forth specific notification and 
access procedures with respect to particular systems of records, 
identifies the officers designated to make the initial determinations 
with respect to notification and access to records and accountings of 
disclosures of records. This appendix also sets forth the specific 
procedures for requesting amendment of records and identifies the 
officers designated to make the intial and appellate determinations with 
respect to requests for amendment of records. It identifies the officers 
designated to grant extensions of time on appeal, the officers with whom 
``Statements of Disagreement'' may be filed, the officer designated to 
receive service of process and the addresses for delivery of requests, 
appeals, and service of process. In addition, it references the notice 
of systems of records and notices of the routine uses of the information 
in the system required by 5 U.S.C. 552a(e) (4) and (11) and published 
annually by the Office of the Federal Register in ``Privacy Act 
Issuances''.
    2. Requests for notification and access to records and accountings 
of disclosures. Initial determinations under 31 CFR 1.26 whether to 
grant requests for notification and access to records and accountings of 
disclosures for the Office of the Comptroller of the Currency will be 
made by the head of the organizational unit having immediate custody of 
the records requested or the delegate of that official. This is 
indicated in the appropriate system notice in ``Privacy Act Issuances'' 
published biennially by the Office of the Federal Register. Requests for 
information and specific guidance on where to send requests for records 
shall be mailed or delivered personally to: Disclosure Officer, 
Communications Division, Office of the Comptroller of the Currency, 250 
E Street, SW, Washington, DC 20219.
    3. Requests for amendment of records. Initial determinations under 
31 CFR 1.27 (a) through (d) whether to grant requests to amend records 
will be made by the Comptroller's delegate or the head of the 
organizational unit having immediate custody of the records or the 
delegate of that official. Requests for amendment shall be mailed or 
delivered personally to: Disclosure Officer, Communications Division, 
Office of the Comptroller of the Currency, 250 E Street, SW., 
Washington, DC 20219.
    4. Administrative appeal of initial determinations refusing 
amendment of records. Appellate determinations refusing amendment of 
records under 31 CFR 1.27(e) including extensions of time on appeal, 
with respect to records of the Office of the Comptroller of the Currency 
will be made by the Comptroller of the Currency or the Comptroller's 
delegate. Appeals shall be mailed or delivered personally to: Disclosure 
Officer, Communications Division, Office of the Comptroller of the 
Currency, 250 E Street, SW., Washington, DC 20219.
    5. Statements of disagreement. ``Statements of Disagreement'' under 
31 CFR 1.27(e)(4)(i) shall be filed with the OCC's Director of 
Communications at the address indicated in the letter of notification 
within 35 days of the date of such notification and should be limited to 
one page.
    6. Service of process. Service of process shall be delivered to the 
Chief Counsel or the Chief Counsel's delegate at the following location: 
Office of the Comptroller of the Currency, 250 E Street, SW., 
Washington, DC 20219.
    7. Annual notice of systems of records. The annual notice of systems 
of records is published by the Office of the Federal Register, as 
specified in 5 U.S.C. 552a(f). The publication is entitled ``Privacy Act 
Issuances''. Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26 and 1.27 are indicated in the notice for the pertinent 
system.

[52 FR 26305, July 14, 1987, as amended at 60 FR 57333, Nov. 15, 1995; 
67 FR 34402, May 14, 2002]

  Appendix K to Subpart C of Part 1--Federal Law Enforcement Training 
                                 Center

    1. In general. This appendix applies to the Federal Law Enforcement 
Training Center. It sets forth specific notification and access 
procedures with respect to particular systems of records, identifies the 
officers designated to make the initial determinations with respect to 
notification and access to records and accountings of disclosure of 
records. This appendix also sets forth the specific procedures for 
requesting amendment of records and identifies the officers designated 
to make the initial and appellate determinations with respect to 
requests for amendment of records. It identifies the officers designated 
to grant extensions of time on appeal, the officers with whom 
``Statements of Disagreement'' may be filed, the officer designated to 
receive service of process and the addresses for delivery of requests, 
appeals, and service of process. In addition, it references the notice 
of systems of records and notices of the routine uses of the information 
in the system required by 5 U.S.C. 552a(e) (4) and (11) and published 
annually by the Office of the Federal Register, in ``Privacy Act 
Issuances''.
    2. Requests for notification and access to records and accounting of 
disclosures. Initial determinations under 31 CFR 1.26, whether to

[[Page 82]]

grant requests for notification and acesss to records and accounting of 
disclosures for the Federal Law Enforcement Training Center, will be 
made by the head of the organizational unit having immediate custody of 
the records requested or an official designated by this official. This 
is indicated in the appropriate system notice in ``Privacy Act 
Issuances'' published annually by the Office of the Federal Register. 
Requests for information and specific guidance on where to send requests 
for records may be mailed or delivered personally to: Privacy Act 
Request, Library Building 262, Federal Law Enforcement Training Center, 
Glynco, Georgia 31524.
    3. Requests for amendment of records. Initial determinations under 
31 CFR 1.27 (a) through (d), whether to grant requests to amend records 
will be made by the head of the organizational unit having immediate 
custody of the records or the delegate of such official. Requests for 
amendment should be addressed as indicated in the appropriate system 
notice in ``Privacy Act Issuances'' published by the Office of the 
Federal Register. Requests for information and specific guidance on 
where to send requests for amendment should be addressed to: Privacy Act 
Amendment Request, Federal Law Enforcement Training Center, Glynco, 
Georgia 31524.
    4. Administrative appeal of initial determinations refusing 
amendment of records. Appellate determinations refusing amendment of 
records under 31 CFR 1.27(e) including extensions of time on appeal, 
with respect to records of the Federal Law Enforcement Training Center 
will be made by the Assistant Secretary (Enforcement), Department of the 
Treasury or the delegate of such officer. Appeals made by mail should be 
addressed to, or delivered personally to: Privacy Act Amendment Appeal, 
FLETC, Assistant Secretary (Enforcement), Department of the Treasury, 
1500 Pennsylvania Avenue, NW., Room 4312, Washington, DC 20220.
    5. Statements of disagreement. ``Statements of Disagreement'' under 
31 CFR 1.27(e)(4)(i) shall be filed with the official signing the 
notification of refusal to amend at the address indicated in the letter 
of notification within 35 days of the date of such notification and 
should be limited to one page.
    6. Service of process. Service of process will be received by the 
General Counsel of the Department of the Treasury or the delegate of 
such official and shall be delivered to the following location: General 
Counsel, Department of the Treasury, Room 3000, Main Treasury Building, 
1500 Pennsylvania Avenue, NW., Washington, DC 20220.
    7. Annual notice of systems of records. The annual notice of systems 
of records is published by the Office of the Federal Register, as 
specified in 5 U.S.C. 552a(f). The publication is entitled ``Privacy Act 
Issuances''. Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26 and 1.27 are indicated in the notice for the pertinent 
system.

[52 FR 26305, July 14, 1987. Redesignated at 65 FR 2334, Jan. 14, 2000]

     Appendix L to Subpart C of Part 1--Office of Thrift Supervision

    1. In general. This appendix applies to the Office of Thrift 
Supervision. It sets forth specific notification and access procedures 
with respect to particular systems of records, and identifies the 
officers designated to make the initial determinations with respect to 
notification and access to records, the officers designated to make the 
initial and appellate determinations with respect to requests for 
amendment of records, the officers designated to grant extensions of 
time on appeal, the officers with whom ``Statement of Disagreement'' may 
be filed, the officer designated to receive services of process and the 
addresses for delivery of requests, appeals, and service of process. In 
addition, it references the notice of systems of records and notices of 
the routine uses of the information in the system required by 5 U.S.C. 
552a(e) (4) and (11) and published biennially by the Office of the 
Federal Register in ``Privacy Act Issuances.''
    2. Requests for notification and access to records and accounting of 
disclosures. Initial determinations under 31 CFR 1.26, whether to grant 
requests for notification and access to records and accountings of 
disclosures for the Office of Thrift Supervision, will be made by the 
head of the organizational unit having immediate custody of the records 
requested, or the delegate of such official. This information is 
contained in the appropriate system notice in the ``Privacy Act 
Issuances,'' published biennially by the Office of the Federal Register. 
Requests for information and specific guidance on where to send requests 
for records should be addressed to: Privacy Act Request, Chief, 
Disclosure Branch, Information Services Division, Office of Thrift 
Supervision, 1700 G Street, NW., Washington, DC 20552.
    Requests may be delivered in person to: Office of Thrift 
Supervision, Information Services Division, 1700 G Street, NW., 
Washington, DC.
    3. Requests for amendments of records. Initial determinations under 
31 CFR 1.27 (a) through (d) with respect to requests to amend records 
maintained by the Office of Thrift Supervision will be made by the head 
of the organization or unit having immediate custody of the records or 
the delegates of such official. Requests for amendment of records should 
be addressed as indicated in the appropriate system notice in ``Privacy 
Act Issuances'' published by the Office of the

[[Page 83]]

Federal Register. Requests for information and specific guidance on 
where to send these requests should be addressed to: Privacy Act 
Amendment Request, Chief, Disclosure Branch, Information Services 
Division, Office of Thrift Supervision, 1700 G Street, NW., Washington, 
DC 20552.
    Privacy Act Amendment Requests may be delivered in person to: Office 
of Thrift Supervision, Information Services Division, 1700 G Street, 
NW., Washington, DC.
    4. Administrative appeal of initial determination refusing to amend 
record. Appellate determination under 31 CFR 1.27(e) with respect to 
records of the Office of Thrift Supervision, including extensions of 
time on appeal, will be made by the Director, Public Affairs, Office of 
Thrift Supervision, or the delegate of such official, as limited by 5 
U.S.C. 552a(d) (2) and (3). Appeals made by mail should be addressed as 
indicated in the letter of initial decision or to: Privacy Act Amendment 
Request, Chief, Disclosure Branch, Information Services Division, Office 
of Thrift Supervision, 1700 G Street, NW., Washington, DC 20552.
    Appeals may be delivered in person to: Office of Thrift Supervision, 
Information Services Division, 1700 G Street, NW., Washington, DC.
    5. Statements of Disagreement. ``Statements of Disagreement'' as 
described in 31 CFR 1.27(e)(4) shall be filed with the official signing 
the notification of refusal to amend at the address indicated in the 
letter of notification within 35 days of the date of notification and 
should be limited to one page.
    6. Service of process. Service of process will be received by the 
Corporate Secretary of the Office of Thrift Supervision or the delegate 
of such official and shall be delivered to the following location: 
Corporate Secretary, Office of Thrift Supervision, 1700 G Street, NW., 
Washington, DC 20552.
    7. Annual notice of systems of record. The annual notice of systems 
of records required to be published by the Office of the Federal 
Register is included in the publication entitled ``Privacy Act 
Issuances,'' as specified in 5 U.S.C. 552a(f). Any specific requirements 
for access, including identification requirements, in addition to the 
requirements set forth in 31 CFR 1.26 and 1.27 and (8) below, and 
locations for access are indicated in the notice for the pertinent 
system.
    8. Verification of identity. An individual seeking notification or 
access to records, or seeking to amend a record, must satisfy one of the 
following identification requirements before action will be taken by the 
Office of Thrift Supervision on any such request:
    (i) An individual seeking notification or access to records in 
person, or seeking to amend a record in person, may establish identity 
by the presentation of a single official document bearing a photograph 
(such as a passport or identification badge) or by the presentation of 
two items of identification which do not bear a photograph but do bear 
both a name and signature (such as a driver's license or credit card).
    (ii) An individual seeking notification or access to records by 
mail, or seeking to amend a record by mail, may establish identity by a 
signature, address, and one other identifier such as a photocopy of a 
driver's license or other official document bearing the individual's 
signature.
    (iii) Notwithstanding subdivisions (i) and (ii) of this 
subparagraph, an individual seeking notification or access to records by 
mail or in person, or seeking to amend a record by mail or in person, 
who so desires, may establish identity by providing a notarized 
statement, swearing or affirming to such individual's identity and to 
the fact that the individual understands the penalties provided in 5 
U.S.C. 552a(i)(3) for requesting or obtaining access to records under 
false pretenses. Alternatively, an individual may provide a statement 
that the individual understands the penalties provided in 5 U.S.C. 
552a(i)(3) for requesting or obtaining access to records under false 
pretenses which is subscribed by the individual as true and correct 
under penalty of perjury pursuant to 28 U.S.C. 1746. Notwithstanding 
subdivision (i), (ii), or (iii) of this subparagraph, a designated 
official may require additional proof of an individual's identity before 
action will be taken on any request, if such official determines that it 
is necessary to protect against unauthorized disclosure of information 
in a particular case. In addition, a parent of any minor or a legal 
guardian of any individual will be required to provide adequate proof of 
legal relationship before such person may act on behalf of such minor or 
such individual.

[60 FR 31633, June 16, 1995. Redesignated at 65 FR 2334, Jan. 14, 2000]

                   Appendix M to Subpart C [Reserved]

      Appendix N to Subpart C--Financial Crimes Enforcement Network

    1. In general. This appendix applies to the Financial Crimes 
Enforcement Network (FinCEN). It sets forth specific notification and 
access procedures with respect to particular systems of records, and 
identifies the officers designated to make the initial determinations 
with respect to notification and access to records and accountings of 
disclosures of records. This appendix also sets forth the specific 
procedures for requesting amendment of records and identifies the 
officers designated to make the initial and appellate determinations 
with respect to requests for amendment of records. It identifies the 
officers designated to grant extensions of time on appeal, the officers 
with whom ``Statements of Disagreement'' may

[[Page 84]]

be filed, the officer designated to receive service of process and the 
addresses for delivery of requests, appeals, and service of process. In 
addition, it references the notice of systems of records and notices of 
the routine uses of the information in the system required by 5 U.S.C. 
552a(4) and (11) and published biennially by the Office of the Federal 
Register in ``Privacy Act Issuances.''
    2. Requests for notification and access to records and accountings 
of disclosures. Initial determinations under 31 CFR 1.26, whether to 
grant requests for notification and access to records and accountings of 
disclosures for FinCEN will be made by the Freedom of Information/
Privacy Act officer, FinCEN. Requests may be mailed to: Privacy Act 
Request, Financial Crimes Enforcement Network, Post Office Box 39, 
Vienna, VA 22183.
    3. Requests for amendments of records. Initial determinations under 
31 CFR 1.27(a) through (d) whether to grant requests to amend records 
maintained by FinCEN will be made by the Freedom of Information/Privacy 
Act officer, FinCEN. Requests may be mailed to: Privacy Act Request, 
Financial Crimes Enforcement Network, Post Office Box 39, Vienna, VA 
22183.
    4. Verification of Identity. An individual seeking notification or 
access to records, or seeking to amend a record, or seeking an 
accounting of disclosures, must satisfy one of the following 
identification requirements before action will be taken by FinCEN on any 
such request:
    (i) An individual may establish identity through the mail by a 
signature, address, and one other identifier such as a photocopy of a 
driver's license or other official document bearing the individual's 
signature.
    (ii) Notwithstanding this paragraph (4)(i), an individual may 
establish identity by providing a notarized statement, swearing or 
affirming to such individual's identity and to the fact that the 
individual understands the penalties provided in 5 U.S.C. 552a(i)(3) for 
requesting or obtaining access to records under false pretenses.
    (iii) Notwithstanding this paragraph (4)(i) and (ii), the Freedom of 
Information Act/Privacy Act Officer or other designated official may 
require additional proof of an individual's identity before action will 
be taken on any request, if such official determines that it is 
necessary to protect against unauthorized disclosure of information in a 
particular case. In addition, a parent of any minor or a legal guardian 
of any individual will be required to provide adequate proof of legal 
relationship before such person may act on behalf of such minor or such 
individual.
    5. Administrative appeal of initial determinations refusing 
amendment of records. Appellate determinations refusing amendment of 
records under 31 CFR 1.27(e) including extensions of time on appeal with 
respect to the records of FinCEN will be made by the Director of FinCEN 
or the delegate of the Director. Appeals should be addressed to: Privacy 
Act Amendment Appeal, Financial Crimes Enforcement Network, Post Office 
Box 39, Vienna, VA 22183.
    6. Statements of Disagreement. ``Statements of Disagreement'' as 
described in 31 CFR 1.27(e)(4) shall be filed with the official signing 
the notification of refusal to amend at the address indicated in the 
letter of notification within 35 days of the date of such notification 
and should be limited to one page.
    7. Service of Process. Service of process will be received by the 
Chief Counsel of FinCEN and shall be delivered to the following 
location: Office of Chief Counsel, Financial Crimes Enforcement Network, 
Post Office Box 39, Vienna, VA 22183.
    8. Biennial notice of systems of records. The biennial notice of 
systems of records is published by the Office of the Federal Register, 
as specified in 5 U.S.C. 552a(f). The publication is entitled ``Privacy 
Act Issuances.'' Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26 and 1.27 and paragraph 4 of this appendix are indicated 
in the notice for the pertinent system.

[68 FR 55311, Sept. 25, 2003]



PART 2_NATIONAL SECURITY INFORMATION--Table of Contents




                    Subpart A_Original Classification

Sec.
2.1 Classification levels [1.1(a)].
2.2 Classification Authority.
2.3 Listing of original classification authorities.
2.4 Record requirements.
2.5 Classification categories.
2.6 Duration of classification.
2.7 Identification and markings [1.5(a), (b) (c)].
2.8 Limitations on classification [1.6(c)].

                   Subpart B_Derivative Classification

2.9 Derivative Classification Authority.
2.10 Listing derivative classification authorities.
2.11 Use of derivative classification [2.1].
2.12 Classification guides.
2.13 Derivative identification and markings [1.5(c) and 2.1(b)].

               Subpart C_Downgrading and Declassification

2.14 Listing downgrading and declassification authorities [3.1(b)].
2.15 Declassification policy [3.1].
2.16 Downgrading and declassification markings.

[[Page 85]]

2.17 Systematic review for declassification [3.3].
2.18 Mandatory declassification review [3.4].
2.19 Assistance to the Department of State [3.3(b)].
2.20 Freedom of Information/Privacy Act requests [3.4].

                         Subpart D_Safeguarding

2.21 General [4.1].
2.22 General restrictions on access [4.1].
2.23 Access by historical researchers and former presidential appointees 
          [4.3].
2.24 Dissemination [4.1(d)].
2.25 Standards for security equipment [4.1(b) and 5.1(b)].
2.26 Accountability procedures [4.1(b)].
2.27 Storage [4.1(b)].
2.28 Transmittal [4.1(b)].
2.29 Telecommunications and computer transmissions.
2.30 Special access programs [1.2(a) and 4.2(a)].
2.31 Reproduction controls [4.1(b)].
2.32 Loss or possible compromise [4.1(b)].
2.33 Responsibilities of holders [4.1(b)].
2.34 Inspections [4.1(b)].
2.35 Security violations.
2.36 Disposition and destruction [4.1(b)].
2.37 National Security Decision Directive 197.

                   Subpart E_Implementation and Review

2.38 Departmental management.
2.39 Bureau administration.
2.40 Emergency planning [4.1(b)].
2.41 Emergency authority [4.1(b)].
2.42 Security education [5.3(a)].

                      Subpart F_General Provisions

2.43 Definitions [6.1].

    Authority: 31 U.S.C. 321; E.O. 12958, 60 FR 19825, 3 CFR, 1995 
Comp., p. 333.

    Source: 55 FR 1644, Jan. 17, 1990, unless otherwise noted.



                    Subpart A_Original Classification



Sec. 2.1  Classification levels [1.1(a)].\1\
---------------------------------------------------------------------------

    \1\ Related references are related to sections of Executive Order 
12356, 47 FR 14874, April 6, 1982.
---------------------------------------------------------------------------

    (a) National security information (hereinafter also referred to as 
``classified information'') shall be classified at one of the following 
three levels:
    (1) Top Secret shall be applied to information, the unauthorized 
disclosure of which reasonably could be expected to cause exceptionally 
grave damage to the national security.
    (2) Secret shall be applied to information, the unauthorized 
disclosure of which reasonably could be expected to cause serious damage 
to the national security.
    (3) Confidential shall be applied to information, the unauthorized 
disclosure of which reasonably could be expected to cause damage to the 
national security.
    (b) Limitations [1.1(b)]. Markings other than ``Top Secret,'' 
``Secret,'' and ``Confidential,'' shall not be used to identify national 
security information. No other terms or phrases are to be used in 
conjunction with these markings to identify national security 
information, such as ``Secret/Sensitive'' or ``Agency Confidential''. 
The terms ``Top Secret,'' ``Secret,'' and ``Confidential'' are not to be 
used to identify non-classified Executive Branch information. The 
administrative control legend, ``Limited Official Use'', is authorized 
in Treasury Directive 71-02, ``Safeguarding Officially Limited 
Information,'' which requires that information so marked is to be 
handled, safeguarded and stored in a manner equivalent to national 
security information classified Confidential.
    (c) Reasonable Doubt [1.1(c)]. When there is reasonable doubt about 
the need to classify information, the information shall be safeguarded 
as if it were ``Confidential'' information in accordance with subpart D 
of this regulation, pending a determination about its classification. 
Upon a final determination of a need for classification, the information 
that is classified shall be marked as provided in Sec. 2.7. When there 
is reasonable doubt about the appropriate classification level, the 
information shall be safeguarded at the higher level in accordance with 
subpart D, pending a determination of its classification level. Upon a 
final determination of its classification level, the information shall 
be marked as provided in Sec. 2.7.



Sec. 2.2  Classification Authority.

    Designations of original classification authority for national 
security information are contained in Treasury Order (TO) 102-19 (or 
successor order),

[[Page 86]]

which is published in the Federal Register. The authority to classify 
inheres within the office and may be exercised by a person acting in 
that capacity. There may be additional redelegations of original 
classification authority made pursuant to TO 102-19 (or successor 
order). Officials with original classification authority may 
derivatively classify at the same classification level.

[63 FR 14357, Mar. 25, 1998]



Sec. 2.3  Listing of original classification authorities.

    Delegations of original Top Secret, Secret and Confidential 
classification authority shall be in writing and be reported annually to 
the Departmental Director of Security, who shall maintain such 
information on behalf of the Assistant Secretary (Management). These 
delegations are to be limited to the minimum number absolutely required 
for efficient administration. Periodic reviews and evaluations of such 
delegations shall be made by the Departmental Director of Security to 
ensure that the officials so designated have demonstrated a continuing 
need to exercise such authority. If, after reviewing and evaluating the 
information, the Departmental Director of Security determines that such 
officials have not demonstrated a continuing need to exercise such 
authority, the Departmental Director of Security shall recommend to the 
Assistant Secretary (Management), as warranted, the reduction or 
elimination of such authority. The Assistant Secretary (Management) 
shall take appropriate action in consultation with the affected 
official(s) and the Departmental Director of Security. Such action may 
include relinquishment of this authority where the Assistant Secretary 
(Management) determines that a firm basis for retention does not exist.



Sec. 2.4  Record requirements.

    The Departmental Director of Security shall maintain a listing by 
name, position title and delegated classification level, of all 
officials in the Departmental Offices who are authorized under this 
regulation to originally classify information as Top Secret, Secret or 
Confidential. Officials within the Departmental Offices with Top Secret 
classification authority shall report in writing on TD F 71-01.14 
(Report of Authorized Classifiers) to the Departmental Director of 
Security, the names, position titles and authorized classification 
levels of the officials designated by them in writing to have original 
Secret or Confidential classification authority. The head of each bureau 
shall maintain a similar listing of all officials in his or her bureau 
authorized to apply original Secret and Confidential classification and 
shall provide a copy of TD F 71-01.14, reflecting the list of officials 
so authorized, to the Departmental Director of Security. These listings 
shall be compiled and reported no less than annually each October 15th 
as required by Treasury Directive 71-01, ``Agency Information Security 
Program Data''.



Sec. 2.5  Classification categories.

    (a) Classification in Context of Related Information [1.3(b)]. 
Certain information which would otherwise be unclassified may require 
classification when combined or associated with other unclassified or 
classified information. Such classification on an aggregate basis shall 
be supported by a written explanation that, at a minimum, shall be 
maintained with the file or referenced on the record copy of the 
information.
    (b) Unofficial Publication or Disclosure [1.3(d)]. Following an 
inadvertent or unauthorized publication or disclosure of information 
identical or similar to information that has been classified in 
accordance with the Order or predecessor Orders, the agency of primary 
interest shall determine the degree of damage to the national security, 
the need for continued classification, and, in coordination with the 
agency in which the disclosure occurred, what action must be taken to 
prevent similar occurrences under procedures contained in Sec. 2.32.



Sec. 2.6  Duration of classification.

    (a) Information Not Marked for Declassification [1.4]. Information 
classified under predecessor orders that is not subject to automatic 
declassification shall remain classified until reviewed for possible 
declassification.

[[Page 87]]

    (b) Authority to Extend Automatic Declassification Determinations 
[1.4(b)]. The authority to extend classification of information subject 
to automatic declassification under any predecessor Executive Order to 
the Order is limited to those officials who have classification 
authority over the information and are designated in writing to have 
original classification authority at the level of the information to 
remain classified. Any decision to extend the classification on other 
than a document-by-document basis shall be reported to the Assistant 
Secretary (Management) who shall, in turn, report this fact to the 
Director of the Information Security Oversight Office.



Sec. 2.7  Identification and markings [1.5(a), (b) and (c)].

    The information security system requires that standard markings be 
applied to classified information. Except in extraordinary circumstances 
as provided in section 1.5(a) of the Order, or as indicated herein, the 
marking of paper and electronically created documents shall not deviate 
from the following prescribed formats. These markings shall also be 
affixed to material other than paper and electronically created 
documents, including file folders, film, tape, etc., or the originator 
shall provide holders or recipients of the information with written 
instructions for protecting the information.
    (a) Classification Level. The markings ``Top Secret,'' ``Secret,'' 
and ``Confidential'' are used to indicate: information that requires 
protection as classified information under the Order; the highest level 
of classification contained in a document; the classification level of 
each page and, in abbreviated form, the classification of each portion 
of a document.
    (1) Overall Marking. The highest level of classification of 
information in a document shall be marked in such a way as to 
distinguish it clearly from the informational text. Markings shall 
appear at the top and bottom of the outside of the front cover (if any), 
on the title page (if any), on the first and last pages bearing text, 
and on the outside of the back cover (if any).
    (2) Page Marking. Each interior page of a classified document is to 
be marked at the top and bottom, either according to the highest 
classification of the content of the page, including the designation 
``UNCLASSIFIED'' when it is applicable, or with the highest overall 
classification of the document.
    (3) Portion Marking. Only the Secretary of the Treasury may waive 
the portion marking requirement for specified classes of documents or 
information upon a written determination that:
    (i) There will be minimal circulation of the specified documents or 
information and minimal potential usage of the documents or information 
as a source for derivative classification determinations; or
    (ii) There is some other basis to conclude that the potential 
benefits of portion marking are clearly outweighed by the increased 
administrative burdens.
    (b) Unless the portion marking requirement has been waived as 
authorized, each portion of a document, including subjects and titles, 
shall be marked by placing a parenthetical designation either 
immediately preceding or following the text to which it applies. The 
symbols, ``(TS)'' for Top Secret, ``(S)'' for Secret, ``(C)'' for 
Confidential, and ``(U)'' for Unclassified shall be used for this 
purpose. The symbol, ``(LOU)'' shall be used for Limited Official Use 
information. If the application of parenthetical designations is not 
practicable, the document shall contain a statement sufficient to 
identify the information that is classified and the level of such 
classification, as well as the information that is not classified. If 
all portions of a document are classified at the same level, this fact 
may be indicated by a statement to that effect, e.g. ``Entire Text is 
Classified Confidential.'' If a subject or title requires 
classification, an unclassified identifier may be applied to facilitate 
reference.
    (c) Classification Authority. If the original classifier is other 
than the signer or approver of the document, his or her indentity shall 
be shown at the bottom of the first and last pages as

[[Page 88]]

follows: ``CLASSIFIED BY (identification of original classification 
authority)''.
    (d) Bureau and Office of Origin. If the identity of the originating 
bureau or office is not apparent on the face of the document, it shall 
be clearly indicated below the ``CLASSIFIED BY'' line.
    (e) Downgrading and Declassification Instructions. Downgrading and, 
as applicable, declassification instructions shall be shown as follows:
    (1) For information to be declassified automatically on a specific 
date:

Classified by___________________________________________________________
Office__________________________________________________________________
Declassify on (date)____________________________________________________

    (2) For information to be declassified automatically upon the 
occurrence of a specific event:

Classified by___________________________________________________________
Office__________________________________________________________________
Declassify on (description of event)____________________________________

    (3) For information not to be declassified automatically:

Classified by___________________________________________________________
Office__________________________________________________________________
Declassify on Origination Agency's Determination Required or ``OADR''

    (4) For information to be downgraded automatically on a specific 
date or upon occurrence of a specific event:

Classified by___________________________________________________________
Office__________________________________________________________________
Downgrade to____________________________________________________________
on (date or description of event)_______________________________________

    (f) Special Markings--(1) Transmittal Documents [1.5(c)]. A 
transmittal document shall indicate on its first page and last page, if 
any, the highest classification of any information transmitted by it. It 
shall also include on the first and last pages the following or similar 
instruction:
    (i) For an unclassified transmittal document:

Unclassified When Classified
Enclosure(s) Detached.

    (ii) For a classified transmittal document:

Upon Removal of Attachment(s)
this Document is________________________________________________________


(classification level of the transmittal document alone), or:

This Document is Classified_____________________________________________
with Unclassified Attachment(s).

    (2) Restricted Data or Formerly Restricted Data [6.2(a)]. Restricted 
Data or Formerly Restricted Data shall be marked in accordance with 
regulations issued under the Atomic Energy Act of 1954, as amended. 
Restricted Data is information dealing with the design, manufacture, or 
utilization of atomic weapons, production of special nuclear material or 
use of special nuclear material in the production of energy. Formerly 
Restricted Data is classified information that has been removed from the 
``restricted data'' category but still remains classified. It relates 
primarily to the military utilization of atomic weapons.
    (3) Intelligence Sources or Methods [1.5(c)]. Documents that contain 
information relating to intelligence sources or methods shall include 
the following marking unless otherwise prescribed by the Director of 
Central Intelligence: ``WARNING NOTICE--INTELLIGENCE SOURCES OR METHODS 
INVOLVED'' To avoid confusion as to the extent of dissemination and use 
restrictions governing the information involved, this marking may not be 
used in conjunction with special access or sensitive compartmented 
information controls.
    (4) Foreign Government Information (FGI) [1.5(c)]. Documents that 
contain FGI shall include either the marking ``FOREIGN GOVERNMENT 
INFORMATION,'' or a marking that otherwise indicates that the 
information is foreign government information. If the information is 
foreign government information that must be concealed, given the 
relationship or understanding with the foreign government providing the 
information, the marking shall not be used and the document shall be 
marked as if it were wholly of United States origin. However, such a 
marking must be supported by a written explanation that, at a minimum, 
shall be maintained with the file or referenced on the original or 
record copy of the document or information.
    (5) National Security Information [4.1(c)]. Classified information 
furnished outside the Executive Branch shall show the following marking:

NATIONAL SECURITY INFORMATION
Unauthorized Disclosure Subject to
Administrative and Criminal Sanctions


[[Page 89]]


    (6) Automated Data Processing (ADP) and Computer Output [1.5(c)]. 
(i) Documents that are generated via ADP or as computer output may be 
marked automatically by systems software. If automatic marking is not 
practicable, such documents must be marked manually.
    (ii) Removable information storage media, however, will bear 
external labels indicating the security classification of the 
information and associated security markings, as applicable, such as 
handling caveats and dissemination controls. Examples of such media 
include magnetic tape reels, cartridges, and cassettes; removable disks, 
disk cartridges, disk packs, and diskettes, including ``floppy'' or 
flexible disks; paper tape reels; and magnetic and punched cards. Two 
labels may be required on each medium: a color coded security 
classification label, i.e., orange Standard Form 706 (Top Secret label), 
red SF 707 (Secret label), blue SF 708 (Confidential label), purple SF 
709 (Classified label), green SF 710 (Unclassified label); and a white 
SF 711 (Data Descriptor label). National stock numbers of the labels, 
which are available through normal Federal Supply channels, are as 
follows: SF 706, 7540-01-207-5536; SF 707, 7450-01-207-5537; SF 708, 
7450-01-207-5538; SF 709, 7540-01-207-5540; SF 710, 7540-01-207-5539 and 
SF 711, 7540-01-207-5541. Treasury Directive 71-02 provides for the use 
of a green ``Officially Limited Information'' label, TD F 71-05.2, to 
identify information so marked.
    (iii) In a mixed environment in which classified and unclassified 
information in processed or stored, the ``Unclassified'' label must be 
used to identify the media containing unclassified information. In 
environments in which only unclassified information is processed or 
stored, the use of the ``Unclassified'' label is not required. 
Unclassified media, however, that are on loan from (and must be returned 
to) vendors do not require the ``Unclassified'' label, but each requires 
a Data Descriptor label with the words, ``Unclassified Vendor Medium'' 
entered on it.
    (iv) Each medium shall be appropriately affixed with a 
classification label and, as applicable, with a Data Descriptor label at 
the earliest practicable time as soon as the proper security 
classification or control has been established. Labels shall be 
conspicuously placed on media in a manner that will not adversely affect 
operation of the equipment in which the media is used. Once applied, the 
label is not to be removed. A label to identify a higher level of 
classification may, however, be applied on top of a lower classification 
level in the event that the content of the media changes, e.g., from 
Confidential to Secret. A lower classification label may not be applied 
to media already bearing a higher classification label. Personnel shall 
be responsible for appropriately labeling and controlling ADP and 
computer storage media within their possession.
    (g) Electronically Transmitted Information (Messages) [1.5(c)]. 
Classified information that is transmitted electronically shall be 
marked as follows:
    (1) The highest level of classification shall appear before the 
first line of text;
    (2) A ``CLASSIFIED BY'' line is not required;
    (3) The duration of classification shall appear as follows:
    (i) For information to be declassified automatically on a specific 
date: ``DECL: (date)'';
    (ii) For information to be declassified upon occurrence of a 
specific event: ``DECL: (description of event)'';
    (iii) For information not to be automatically declassified which 
requires the originating agency's determination (see also Sec. 
2.7(e)(3)): ``DECL: OADR'';
    (iv) For information to be automatically downgraded: ``DOWNGRADE TO 
(classification level to which the information is to be downgraded) ON 
(date or description of event on which downgrading is to occur)''.
    (4) Portion marking shall be as prescribed in Sec. 2.7(a)(3);
    (5) Specially designated markings as prescribed in Sec. 2.7(f) (2), 
(3), and (4) shall appear after the marking for the highest level of 
classification. These include:
    (i) Restricted Data or Formerly Restricted Data;
    (ii) Information concerning intelligence sources or methods:

[[Page 90]]

``WNINTEL,'' unless otherwise prescribed by the Director of Central 
Intelligence; and
    (iii) Foreign Government Information (FGI).
    (6) Paper copies of electronically transmitted messages shall be 
marked as provided in Sec. 2.7(a) (1), (2), and (3).
    (h) Changes in Classification Markings [4.1(b)]. When a change is 
made in the duration of classified information, all holders of record 
shall be promptly notified. If practicable, holders of record shall also 
be notified of a change in the level of classification. Holders shall 
alter the markings on their copy of the information to conform to the 
change, citing the authority for it. If the remarking of large 
quantities of information is unduly burdensome, the holder may attach a 
change of classification notice to the storage unit in lieu of the 
marking action otherwise required. Items withdrawn from the collection 
for purposes other than transfer for storage shall be marked promptly in 
accordance with the change notice.



Sec. 2.8  Limitations on classification [1.6(c)].

    (a) Before reclassifying information as provided in section 1.6(c) 
of the Order, authorized officials, who must have original 
classification authority and jurisdiction over the information involved, 
shall consider the following factors which shall be addressed in a 
report to the Assistant Secretary (Management) who shall in turn forward 
a report to the Director of the Information Security Oversight Office:
    (1) The elapsed time following disclosure;
    (2) The nature and extent of disclosure;
    (3) The ability to bring the fact of reclassification to the 
attention of persons to whom the information was disclosed;
    (4) The ability to prevent further disclosure; and
    (5) The ability to retrieve the information voluntarily from persons 
not authorized access in its reclassified state.
    (b) Information may be classified or reclassified after it has been 
requested under the Freedom of Information Act (5 U.S.C. 552), the 
Privacy Act of 1974 (5 U.S.C. 552a), or the mandatory declassification 
review provisions of the Order if such classification meets the 
requirements of the Order and is accomplished personally and on a 
document-by-document basis by the Secretary of the Treasury, the Deputy 
Secretary, the Assistant Secretary (Management) or an official with 
original Top Secret classification authority. Such reclassification 
actions shall be reported in writing to the Departmental Director of 
Security.
    (c) In no case may information be classified or reclassified in 
order to conceal violations of law, inefficiency, or administrative 
error; to prevent embarrassment to a person, organization, or agency; to 
restrain competition; or to prevent or delay the release of information 
that does not require protection in the interest of national security.



                   Subpart B_Derivative Classification



Sec. 2.9  Derivative Classification Authority.

    Designations of derivative classification authority for national 
security information are contained in Treasury Order 102-19 (or 
successor order). The authority to derivatively classify inheres within 
the office and may be exercised by a person acting in that capacity. 
There may be additional redelegations of derivative classification 
authority made pursuant to TO 102-19 (or successor order). Officials 
identified in Treasury Order 102-19 (or successor order) may also 
administratively control and decontrol sensitive but unclassified 
information using the legend ``Limited Official Use'' and may redelegate 
their authority to control and decontrol. Such redelegations shall be in 
writing on TD F 71-01.20 ``Designation of Controlling/Decontrolling 
Officials'' (or successor form).

[63 FR 14357, Mar. 25, 1998]



Sec. 2.10  Listing derivative classification authorities.

    Delegations of derivative classification authority to officials not 
otherwise identified in Sec. 2.9, shall be in writing and reported 
annually each October

[[Page 91]]

15th to the Departmental Director of Security on TD F 71-01.18 (Report 
of Authorized Derivative Classifiers). Such delegations shall be limited 
to the minimum number absolutely required for efficient administration. 
Periodic reviews and evaluations of such delegations shall be made by 
the Departmental Director of Security to ensure that officials so 
designated have demonstrated a continuing need to exercise such 
authority. If after reviewing and evaluating the information the 
Departmental Director of Security determines that such officials have 
not demonstrated a continuing need to exercise such authority, the 
Departmental Director of Security shall recommend to the Assistant 
Secretary (Management), as warranted, the reduction or elimination of 
such authority. The Assistant Secretary (Management) shall take 
appropriate action in consultation with the affected official(s) and the 
Departmental Director of Security. Such action may include 
relinquishment of this authority where the Assistant Secretary 
(Management) determines that a firm basis for retention does not exist.



Sec. 2.11  Use of derivative classification [2.1].

    The application of derivative classification markings is a 
responsibility of those who incorporate, paraphrase, restate, or 
generate in new form information that is already classified, and of 
those who apply markings in accordance with instructions from an 
authorized original classifier or in accordance with an approved 
classification guide. If an individual who applies derivative 
classification markings believes that the paraphrasing, restating or 
summarizing of classified information has changed the level of or 
removed the basis for classification, that person must consult an 
appropriate official of the originating agency or office of origin who 
has the authority to upgrade, downgrade or declassify the information 
for a final determination. A sample marking of derivatively classified 
documents is set forth in Sec. 2.13.



Sec. 2.12  Classification guides.

    (a) General [2.2(a)]. A classification guide is a reference manual 
which assists document drafters and document classifiers in determining 
what types or categories of material have already been classified. The 
classification guide shall, at a minimum:
    (1) Identify and categorize the elements of information to be 
protected;
    (2) State which classification level applies to each element or 
category of information; and
    (3) Prescribe declassification instructions for each element or 
category of information in terms of:
    (i) A period of time,
    (ii) The occurrence of an event, or
    (iii) A notation that the information shall not be declassified 
automatically without the approval of the originating agency i.e., 
``OADR''.
    (b) Review and Record Requirements [2.2(a)]. (1) Each classification 
guide shall be kept current and shall be reviewed at least once every 
two years and updated as necessary. Each office within the Departmental 
Offices and the respective offices of each Treasury bureau possessing 
original classification authority for national security information 
shall maintain a list of all classification guides in current use by 
them. A copy of each such classification guide in current use shall be 
furnished to the Departmental Director of Security who shall maintain 
them on behalf of the Assistant Secretary (Management).
    (2) Each office and bureau that prepares and maintains a 
classification guide shall also maintain a record of individuals 
authorized to apply derivative classification markings in accordance 
with a classification guide. This record shall be maintained on TD F 71-
01.18 (Report of Authorized Derivative Classifiers) which shall be 
reported annually each October 15th to the Departmental Director of 
Security.
    (c) Waivers [2.2(c)]. Any authorized official desiring a waiver of 
the requirement to issue a classification guide shall submit in writing 
to the Assistant Secretary (Management) a request for approval of such a 
waiver. Any request for a waiver shall contain, at a minimum, an 
evaluation of the following factors:
    (1) The ability to segregate and describe the elements of 
information;

[[Page 92]]

    (2) The practicality of producing or disseminating the guide because 
of the nature of the information;
    (3) The anticipated usage of the guide as a basis for derivative 
classification; and
    (4) The availability of alternative sources for derivatively 
classifying the information in a uniform manner.



Sec. 2.13  Derivative identification and markings [1.5(c) and 2.1(b)].

    Information classified derivatively on the basis of source documents 
or classification guides shall bear all markings prescribed in Sec. 2.7 
(a) through (f), as are applicable. Information for these markings shall 
be taken from the source document or instructions in the appropriate 
classification guide.
    (a) Classification Authority. The authority for classification shall 
be shown as follows:

Derivatively Classified by______________________________________________
Office__________________________________________________________________
Derived from____________________________________________________________
Declassify on___________________________________________________________


If a document is classified on the basis of more than one source 
document or classification guide, the authority for classification shall 
be shown on the ``DERIVED FROM'' line as follows: ``MULTIPLE CLASSIFIED 
SOURCES''. In these cases, the derivative classifier must maintain the 
identification of each source with the file or record copy of the 
derivatively classified document. A document derivatively classified on 
the basis of a source document that is marked ``MULTIPLE CLASSIFIED 
SOURCES'' shall cite the source document on its ``DERIVED FROM'' line 
rather than the term: ``MULTIPLE CLASSIFIED SOURCES''. Preparers of such 
documentation shall ensure that the identification of the derivative 
classifier is indicated. Use of the term ``MULTIPLE CLASSIFIED 
SOURCES,'' is not to be a substitute for the identity of the derivative 
classification authority.
    (b) Downgrading and Declassification Instructions. Dates or events 
for automatic downgrading or declassification shall be carried forward 
from the source document. This includes the notation ``ORIGINATING 
AGENCY'S DETERMINATION REQUIRED'' to indicate that the document is not 
to be downgraded or declassified automatically, or instructions as 
directed by a classification guide, which shall be shown on a 
``DOWNGRADE TO'' or ``DECLASSIFY ON'' line as follows:

DOWNGRADE TO____________________________________________________________
ON (date, description of event, or OADR) or,
DECLASSIFY ON (date, description of event, or OADR)



               Subpart C_Downgrading and Declassification



Sec. 2.14  Listing downgrading and declassification authorities 3.1(b)].

    Downgrading and declassification authority may be exercised by the 
official authorizing the original classification, if that official is 
still serving in the same position; a successor in that capacity; a 
supervisory official of either; or officials delegated such authority in 
writing by the Secretary of the Treasury or the Assistant Secretary 
(Management). Such officials may not downgrade or declassify information 
which is classified at a level exceeding their own designated 
classification authority. A listing of officials delegated such 
authority, in writing, shall be identified on TD F 71-01.11 (Report of 
Authorized Downgrading and Declassification Officials) and reported 
annually each October 15th to the Departmental Director of Security who 
shall maintain them on behalf of the Assistant Secretary (Management). 
Current listings of officials so designated shall be maintained by 
Treasury bureaus and offices within the Departmental Offices.

[55 FR 1644, Jan. 17, 1990; 55 FR 13134, Apr. 9, 1990]



Sec. 2.15  Declassification policy [3.1].

    In making determinations under section 3.1(a) of the Order, 
officials shall respect the intent of the Order to protect foreign 
government information and confidential foreign sources.



Sec. 2.16  Downgrading and declassification markings.

    Whenever a change is made in the original classification or in the 
dates of downgrading or declassification of any classified information, 
it shall be promptly and conspicuously marked to

[[Page 93]]

indicate the change, the authority for the action, the date of the 
action, and the identity of the person taking the action. Earlier 
classification markings shall be cancelled or otherwise obliterated when 
practicable. See also Sec. 2.7(h).



Sec. 2.17  Systematic review for declassification [3.3].

    (a) Permanent Records. Systematic review is applicable only to those 
classified records and presidential papers or records that the Archivist 
of the United States, acting under the Federal Records Act, has 
determined to be of sufficient historical or other value to warrant 
permanent retention.
    (b) Non-Permanent Classified Records. Non-permanent classified 
records shall be disposed of in accordance with schedules approved by 
the Administrator of General Services under the Records Disposal Act. 
These schedules shall provide for the continued retention of records 
subject to an ongoing mandatory declassification review request.
    (c) Systematic Declassification Review Guidelines [3.3(a)]. As 
appropriate, guidelines for systematic declassification review shall be 
issued by the Assistant Secretary (Management) in consultation with the 
Archivist of the United States, the Director of the Information Security 
Oversight Office and Department officials, to assist the Archivist in 
the conduct of systematic reviews. Such guidelines shall be reviewed and 
updated at least every five years unless earlier review is requested by 
the Archivist.
    (d) Foreign Government Systematic Declassification Review Guidelines 
[3.3(a)]. As appropriate, guidelines for systematic declassification 
review of foreign government information shall be issued by the 
Assistant Secretary (Management) in consultation with the Archivist of 
the United States, the Director of the Information Security Oversight 
Office, Department officials and other agencies having declassification 
authority over the information. These guidelines shall be reviewed and 
updated every five years unless earlier review is requested by the 
Archivist.
    (e) Special Procedures. The Department shall be bound by the special 
procedures for systematic review of classified cryptologic records and 
classified records pertaining to intelligence activities (including 
special activities), or intelligence sources or methods issued by the 
Secretary of Defense and the Director of Central Intelligence, 
respectively.



Sec. 2.18  Mandatory declassification review [3.4].

    (a) Except as provided by section 3.4 (b) of the Order, all 
information classified by the Department under the Order or any 
predecessor Executive Order shall be subject to declassification review 
by the Department, if:
    (1) The request is made by a United States citizen or permanent 
resident alien, a Federal agency, or a state or local government;
    (2) The request describes the document or material containing the 
information with sufficient specificity to enable the Department to 
locate it with a reasonable amount of effort; and
    (3) The requester provides substantial proof as to his or her United 
States citizenship or status as a permanent resident alien, e.g., a copy 
of a birth certificate, a certificate of naturalization, official 
passport or some other means of identity which sufficiently describes 
the requester's status. A permanent resident alien is any individual, 
who is not a citizen or national of the United States, who has been 
lawfully accorded the privilege of residing permanently in the United 
States as an immigrant in accordance with the immigration laws, such 
status not having changed. Permanent means a relationship of continuing 
or lasting nature, as distinguished from temporary, but a relationship 
may be permanent even though it is one that may be dissolved eventually 
at the instance either of the United States or of the individual, in 
accordance with law.
    (b) Processing--(1) Initial Requests for Classified Records 
Originated by the Department. Requests for mandatory declassification 
review shall be directed to the Departmental Office of Security, 1500 
Pennsylvania Avenue, NW., Washington, DC 20220. Upon receipt of each 
request for declassification, pursuant to section 3.4 of the Order, the 
following procedures shall apply:

[[Page 94]]

    (i) The Departmental Office of Security shall acknowledge the 
receipt of the request in writing.
    (ii) A valid mandatory declassification review request need not 
identify the requested information by date or title of the responsive 
records, but must be of sufficient particularity to allow Treasury 
personnel to locate the records containing the information sought with a 
reasonable amount of effort. Whenever a request does not reasonably 
describe the information sought, the requester shall be notified by the 
Departmental Office of Security that unless additional information is 
provided or the scope of the request is narrowed, no further action will 
be undertaken.
    (iii) The Departmental Office of Security shall determine the 
appropriate office or bureau to take action on the request and shall 
forward the request to that office or bureau.
    (iv) In responding to mandatory declassification review requests, 
the appropriate reviewing officials shall make a prompt declassification 
determination. The Departmental Office of Security shall notify the 
requester if additional time is needed to process the request. Reviewing 
officials shall also identify the amount of search and/or review time 
required to process the request. The Department shall make a final 
determination within one year from the date of receipt except in unusual 
circumstances. When information cannot be declassified in its entirety, 
reasonable efforts, consistent with other applicable laws, will be made 
to release those declassified portions of the requested information 
which constitute a coherent segment. Upon the denial or partial denial 
of an initial request, the Departmental Office of Security shall also 
notify the requester of the right of an administrative appeal which must 
be filed with the Assistant Secretary (Management) within 60 days of 
receipt of the denial.
    (v) When the Department receives a mandatory declassification review 
request for records in its possession that were originated by another 
agency, the Departmental Office of Security shall forward the request to 
that agency. The Departmental Office of Security shall include a copy of 
the records requested together with the Department's recommendations for 
action. Upon receipt, the originating agency shall process the request 
in accordance with the Directive 32 CFR 2001.32(a)(2)(i). The 
originating agency shall also be requested to communicate its 
declassification determination to Treasury.
    (vi) When another agency forwards to the Department a request for 
information in that agency's custody that has been classified by 
Treasury, the Departmental Office of Security shall:
    (A) Advise the other agency as to whether it can notify the 
requester of the referral;
    (B) Review the classified information in coordination with other 
agencies that have a direct interest in the subject matter; and
    (C) Respond to the requester in accordance with the procedures in 
Sec. 2.18(b)(1)(iv). If requested, Treasury's determination shall be 
communicated to the referring agency.
    (vii) Appeals of denials of a request for declassification shall be 
referred to the Assistant Secretary (Management) who shall normally make 
a determination within 30 working days following the receipt of an 
appeal. If additional time is required to make a determination, the 
Assistant Secretary (Management) shall notify the requester of the 
additional time needed and provide the requester with the reason for the 
extension. The Assistant Secretary (Management) shall notify the 
requester in writing of the final determination and, as applicable, the 
reasons for any denial.
    (viii) Except as provided in this paragraph, the Department shall 
process mandatory declassification review requests for classified 
records containing foreign government information in accordance with 
Sec. 2.18(a). The agency that initially received or classified the 
foreign government information shall be responsible for making a 
declassification determination after consultation with concerned 
agencies. If upon receipt of the request, the Department determines that 
Treasury is not the agency that received or classified the foreign 
government information, it shall refer the request to the appropriate 
agency for action. Consultation

[[Page 95]]

with the foreign originator through appropriate channels may be 
necessary prior to final action on the request.
    (ix) Mandatory declassification review requests for cryptologic 
information and/or information concerning intelligence activities 
(including special activities) or intelligence sources or methods shall 
be processed solely in accordance with special procedures issued by the 
Secretary of Defense and the Director of Central Intelligence, 
respectively.
    (x) The fees to be charged for mandatory declassification review 
requests shall be for search and/or review and duplication. The fee 
charges for services of Treasury personnel involved in locating and/or 
reviewing records shall be at the rate of a GS-10, Step 1, for each hour 
or fraction thereof, except that no charge shall be imposed for search 
and/or review consuming less than one hour.
    (A) Photocopies per page up to 8\1/2\ by 14 
shall be charged at the rate of 10 cents each except that no charge will 
be imposed for reproducing ten (10) pages or less when search and/or 
review time requires less than one hour.
    (B) When it is estimated that the costs associated with the 
mandatory declassification review request will exceed $100.00, the 
Departmental Office of Security shall notify the requester of the likely 
cost and obtain satisfactory written assurance of full payment or may 
require the requester to make an advance payment of the entire fee 
before continuing to process the request. The Department reserves the 
right to request prepayment after a mandatory declassification review 
request is processed and before documents are released. In the event the 
requester does not agree to pay the actual charges, he or she shall 
advise how to proceed with the mandatory declassification review 
request. Failure of a requester to pay charges after billing will result 
in future requests not being honored.
    (C) In order for a requester's initial request to be processed it 
shall be accompanied by a statement that he or she is agreeable to 
paying fees for search and/or review and copying. In the event the 
initial request does not include this statement, processing of the 
request will be held in abeyance until such time as the required 
statement is received. Failure to provide a response within a reasonable 
amount of time will serve as the basis for administratively terminating 
the mandatory declassification review request.
    (D) Payment of fees shall be made by check or money order payable to 
the Treasurer of the United States. Fees levied by the Department of the 
Treasury for mandatory declassification review requests are separate and 
distinct from any other fees which might be imposed by a Presidential 
Library, the National Archives and Records Administration or another 
agency or department.



Sec. 2.19  Assistance to the Department of State [3.3(b)].

    The Secretary of the Treasury shall assist the Department of State 
in its preparation of the ``Foreign Relations of the United States'' 
series by facilitating access to appropriate classified material in 
Treasury custody and by expediting declassification review of documents 
proposed for inclusion in the series.



Sec. 2.20  Freedom of Information/Privacy Act requests [3.4].

    The Department of the Treasury shall process requests for records 
containing classified national security information that are submitted 
under the provisions of the Freedom of Information Act, as amended, or 
the Privacy Act of 1974, as amended, in accordance with the provisions 
of those Acts.



                         Subpart D_Safeguarding



Sec. 2.21  General [4.1].

    Information classified pursuant to this Order or predecessor Orders 
shall be afforded a level of protection against unauthorized disclosure 
commensurate with its level of classification.



Sec. 2.22  General restrictions on access [4.1].

    (a) Determination of Need-To-Know. Classified information shall be 
made available to a person only when the possessor of the classified 
information establishes in each instance, except as

[[Page 96]]

provided in section 4.3 of the Order, that access is essential to the 
accomplishment of official United States Government duties or 
contractual obligations.
    (b) Determination of Trustworthiness. A person is eligible for 
access to classified information only after a showing of trustworthiness 
as determined by the Secretary of the Treasury based upon appropriate 
investigations in accordance with applicable standards and criteria.
    (c) Classified Information Nondisclosure Agreement. Standard Form 
312 (Classified Information Nondisclosure Agreement) or the prior SF 
189, bearing the same title, are nondisclosure agreements between the 
United States and an individual. The execution of either the SF 312 or 
SF 189 agreement by an individual is necessary before the United States 
Government may grant the individual access to classified information. 
Bureaus and the Departmental Offices must retain executed copies of the 
SF 312 or prior SF 189 in file systems from which the agreements can be 
expeditiously retrieved in the event the United States must seek their 
enforcement. Copies or legally enforceable facsimiles of the SF 312 or 
SF 189 must be retained for 50 years following their date of execution. 
The national stock number for the SF 312 is 7540-01-280-5499.



Sec. 2.23  Access by historical researchers and former presidential 
appointees [4.3].

    (a) Access to classified information may be granted only as is 
essential to the accomplishment of authorized and lawful United States 
Government purposes. This requirement may be waived, however, for 
persons who:
    (1) Are engaged in historical research projects, or
    (2) Previously have occupied policymaking positions to which they 
were appointed by the President.
    (b) Access to classified information may be granted to historical 
researchers and to former Presidential appointees upon a determination 
of trustworthiness; a written determination that such access is 
consistent with the interests of national security; the requestor's 
written agreement to safeguard classified information; and the 
requestor's written consent to have his or her notes and manuscripts 
reviewed to ensure that no classified information is contained therein. 
The conferring of historial researcher status does not include 
authorization to release foreign government information or other 
agencies' classified information per Sec. 2.24 of this part. By the 
terms of section 4.3(b)(3) of the Order, former Presidential appointees 
not engaged in historical research may only be granted access to 
classified documents which they ``originated, reviewed, signed or 
received while serving as a Presidential appointee.'' Coordination shall 
be made with the Departmental Director of Security with respect to the 
required written agreements to be signed by the Department and such 
historical researchers or former Presidential appointees, as a condition 
of such access and to ensure the safeguarding of classified information.
    (c) If the access requested by historical researchers and former 
Presidential appointees requires the rendering of services for which 
fair and equitable fees may be charged pursuant to 31 U.S.C. 9701, the 
requestor shall be so notified and the fees may be imposed. Treasury's 
fee schedule identified in Sec. 2.18(b)(1)(x), applicable to mandatory 
declassification review, shall also apply to fees charged for services 
provided to historical researchers and former Presidential appointees 
for search and/or review and copying.



Sec. 2.24  Dissemination [4.1(d)].

    Except as otherwise provided by section 102 of the National Security 
Act of 1947, 61 Stat. 495, 50 U.S.C. 403, classified information 
originating in another agency may not be disseminated outside the 
Department without the consent of the originating agency.



Sec. 2.25  Standards for security equipment [4.1(b) and 5.1(b)].

    The Administrator of General Services issues (in coordination with 
agencies originating classified information), establishes and publishes 
uniform standards, specifications, and supply schedules for security 
equipment designed to provide for secure storage and to destroy 
classified information.

[[Page 97]]

Treasury bureaus and the Departmental Offices may establish more 
stringent standards for their own use. Whenever new security equipment 
is procured, it shall be in conformance with the standards and 
specifications referred to above and shall, to the maximum extent 
practicable, be of the type available through the Federal Supply System.



Sec. 2.26  Accountability procedures [4.1(b)].

    (a) Top Secret Control Officers. Each Treasury bureau and the 
Departmental Offices shall designate a primary and alternate Top Secret 
Control Officer. Within the Departmental Offices, the Top Secret Control 
Officer function will be established in the Office of the Executive 
Secretary for collateral Top Secret information and in the Office of the 
Special Assistant to the Secretary (National Security) with respect to 
sensitive compartmented information. The term ``collateral'' refers to 
national security information classified Confidential, Secret, or Top 
Secret under the provisions of Executive Order 12356 or prior Orders, 
for which special intelligence community systems of compartmentation 
(such as sensitive compartmented information) or special access programs 
are not formally established. Top Secret Control Officers so designated 
must have a Top Secret security clearance and shall:
    (1) Initially receive all Top Secret information entering their 
respective bureau, including the Departmental Offices. Any Top Secret 
information received by a Treasury bureau or Departmental Offices 
employee shall be immediately hand carried to the designated Top Secret 
Control Officer for proper accountability.
    (2) Maintain current accountability records of Top Secret 
information received within their bureau or office.
    (3) Ensure that Top Secret information is properly stored and that 
Top Secret information under their control is personally destroyed, when 
required. Top Secret information must be destroyed in the presence of an 
appropriately cleared official who shall actually witness such 
destruction. Accordingly, the use of burnbags to store Top Secret 
information, pending final destruction at a later date, is not 
authorized.
    (4) Ensure that prohibitions against reproduction of Top Secret 
information are strictly followed.
    (5) Conduct annual physical inventories of Top Secret information. 
An inventory shall be conducted in the presence of an individual with an 
appropriate security clearance. The inventory shall be completed 
annually and signed by the Top Secret Control Officer and the witnessing 
individual.
    (6) Ensure that Top Secret documents are downgraded, declassified, 
retired or destroyed as required by regulations or other markings.
    (7) Attach a TD F 71-01.7 (Top Secret Document Record) to the first 
page or cover of each copy of Top Secret information. The Top Secret 
Document Record shall be completed by the Top Secret Control Officer and 
shall serve as a permanent record.
    (8) Ensure that all persons having access to Top Secret information 
sign the Top Secret Document Record. This also includes persons to whom 
oral disclosure of the contents is made.
    (9) Maintain receipts concerning the transfer and destruction of Top 
Secret information. Record all such actions on the Top Secret Document 
Record which shall be retained for a minimum of three years.
    (10) As received, number in sequence each Top Secret document in a 
calendar year series (e.g. TS 89-001). This number shall be posted on 
the face of the document and on all forms required for control of Top 
Secret information.
    (11) Attach a properly executed TD F 71-01.5 (Classified Document 
Record of Transmittal) when a Top Secret document is transmitted 
internally or externally.
    (12) Verify, prior to releasing Top Secret information, that the 
recipient has both a security clearance and is authorized access to such 
information.
    (13) Report, in writing, all Top Secret documents unaccounted for to 
the Assistant Secretary (Management) who shall take appropriate action 
in conjunction with the Departmental Director of Security.
    (14) Assure that no individual within his or her office or bureau 
transmits

[[Page 98]]

Top Secret information to another individual or office without the 
knowledge and consent of the Top Secret Control Officer.
    (15) Ensure upon receipt that a Standard Form 703 (Top Secret Cover 
Sheet) is affixed to such information.
    (16) Notify office and/or bureau employees annually in writing of 
the designated control point for all incoming and outgoing Top Secret 
information.
    (17) Be notified as to the transmission, per Sec. 2.28(b), whenever 
Top Secret information is sent outside of a Treasury bureau or office 
within the Departmental Offices.
    (b) Top Secret Control Officer Listings. In order for the 
Departmental Director of Security to maintain a current listing of Top 
Secret Control Officers within the Department, each Treasury bureau and 
the Departmental Offices shall annually report each October 15th in 
writing to the Departmental Office of Security, the identities of the 
office(s) and names of the officials designated as their primary and 
alternate Top Secret Control Officers. Any changes in these designations 
shall be reported to the Departmental Director of Security within thirty 
days.
    (c) Top Secret Document Record. Upon receipt in the Department a 
green, color coded, TD F 71-01.7 (Top Secret Document Record) shall be 
attached by the Top Secret Control Officer to the first page or cover of 
the original and each copy of Top Secret information. The Top Secret 
Document Record shall remain attached to the Top Secret information 
until it is either transferred to another United States Government 
agency, downgraded, declassified or destroyed. The Top Secret Document 
Record, which shall initially be completed by the Top Secret Control 
Officer, shall identify the Top Secret information attached, and shall 
serve as a permanent record of the information. All persons, including 
stenographic and clerical personnel, having access to the information 
attached to the Top Secret Document Record must list their name and the 
date on the TD F 71-01.7 prior to accepting responsibility for its 
custody. The TD F 71-01.7 shall also indicate those individuals to whom 
only oral disclosure of the contents is made. Whenever any Top Secret 
information is transferred to another United States Government agency, 
downgraded, declassified or destroyed, the Top Secret Control Officer 
shall record the action on the Top Secret Document Record and retain it 
for a minimum or three years after which time it may be destroyed. In 
order to maintain the integrity of the color coding process the 
photocopying and use of non-color coded Top Secret Document Record forms 
is prohibited.
    (d) Classified Document Record of Transmittal. TD F 71-01.5 
(Classified Document Record of Transmittal) shall be the exclusive 
classified document accountability record for use within the Department 
of the Treasury. No other logs or records shall be required except for 
the use of TD F 71-01.7 which is applicable to Top Secret information. 
TD F 71-01.5 shall be used for single or multiple document receipting 
and for internal and external routing. The inclusion of classified 
information on TD F 71-01.5 is to be avoided. In the event the subject 
title is classified, a recognizable short title shall be used, e.g., 
first letter of each word in the subject title. Several items may be 
transmitted to the same addressee with one TD F 71-01.5. TD F's 71-01.5 
shall be maintained for a three year period after which the form may be 
destroyed. No record of the actual destruction of the TD F 71-01.5 is 
necessary.
    (1) Top Secret Information. Top Secret information shall be subject 
to a continuous receipt system regardless of how brief the period of 
custody. TD F 71-01.5 shall be used for this purpose. Top Secret 
accountability records shall be maintained by Top Secret Control 
Officers separately from the accountability records of other classified 
information.
    (2) Secret Information. Receipt on TD F 71-01.5 shall be required 
for transmission of Secret information between bureaus, offices and 
separate agencies. Responsible office heads shall determine 
administrative procedures required for the internal control within their 
respective offices. The volume of classified information handled and 
personnel resources available must be considered in determining the 
level of adequate security measures while at the

[[Page 99]]

same time maintaining operational efficiency.
    (3) Confidential and Limited Official Use Information. Receipts for 
Confidential and Limited Official Use information shall not be required 
unless the originator indicates that receipting is necessary.

[55 FR 1644, Jan. 17, 1990; 55 FR 13134, Apr. 9, 1990]



Sec. 2.27  Storage [4.1(b)].

    Classified information shall be stored only in facilities or under 
conditions designed to prevent unauthorized persons from gaining access 
to it.
    (a) Minimum Requirements for Physical Barriers--(1) Top Secret. Top 
Secret information shall be stored in a GSA-approved security container 
with an approved, built-in, three-position, dial-type, changeable, 
combination lock; in a vault protected by an alarm system and response 
force; or in other types of storage facilities that meet the standards 
for Top Secret information established under the provisions of Sec. 
2.25. Top Secret information stored outside the United States must be in 
a facility afforded diplomatic status. One or more of the following 
supplementary controls is required:
    (i) The area that houses the security container or vault shall be 
subject to the continuous protection of U.S. guard or duty personnel;
    (ii) U.S. Guard or duty personnel shall inspect the security 
container or vault at least once every two hours; or
    (iii) The security container or vault shall be controlled by an 
alarm system to which a force will respond in person within 15 minutes.

Within the United States, the designated security officer in each 
Treasury bureau and the Department Offices shall prescribe those 
supplementary controls deemed necessary to restrict unauthorized access 
to areas in which such information is stored. Any vault used for the 
storage of sensitive compartmented information shall be configured to 
the specifications of the Director of Central Intelligence. Prior to an 
office or bureau operating such a vault, formal written certification 
for its use must first be obtained from the Special Assistant to the 
Secretary (National Security) as the senior Treasury official of the 
Intelligence Community.
    (2) Secret and Confidential. Secret and Confidential information 
shall be stored in a manner and under the conditions prescribed for Top 
Secret information, or in a container, vault, or alarmed area that meets 
the standards for Secret or Confidential information established under 
the provisions of Sec. 2.25. Secret and Confidential information may 
also be stored in a safe-type filing cabinet having a built-in, three-
position, dial-type, changeable, combination lock, and may continue to 
be stored in a steel filing cabinet equipped with a steel lock-bar 
secured by a GSA-approved three-position, dial-type, changeable, 
combination padlock. The modification, however, of steel filing cabinets 
to barlock-type as storage equipment for classified information and 
material is prohibited and efforts are to be made to selectively phase 
out the use of such barlock cabinets for storage of Secret information. 
Exceptions may be authorized only by the Departmental Director of 
Security upon written request from the designated bureau security 
officer. The designated security officer in each Treasury bureau and the 
Departmental Offices shall prescribe those supplementary controls deemed 
necessary to restrict unauthorized access to areas in which such 
information is stored. Access to bulky Secret and Confidential material 
in weapons storage areas, strong rooms, evidence vaults, closed areas or 
similar facilities shall be controlled in accordance with requirements 
approved by the Department. At a minimum, such requirements shall 
prescribe the use of GSA-approved, key-operated, high-security padlocks. 
For Secret and Confidential information stored outside the United 
States, it shall be stored in the manner authorized for Top Secret, in a 
GSA-approved safe file, or in a barlick cabinet equipped with a 
security-approved combination padlock if the cabinet is located in a 
security-approved vault and/or in a restricted area to which access is 
controlled by United States citizen personnel on a 24-hour basis.
    (b) Combinations--(1) Equipment in Service. Combinations to dial-
type, changeable, combination locks shall be

[[Page 100]]

changed only by persons having an appropriate security clearance, and 
shall be changed,
    (i) Whenever such equipment is placed in use;
    (ii) Whenever a person knowing the combination no longer requires 
access to it;
    (iii) Whenever a combination has been subjected to possible 
compromise;
    (iv) Whenever the equipment is taken out of service: or
    (v) At least once each year.

Knowledge of combinations shall be limited to the minimum number of 
persons necessary for operating purposes. Records of combinations shall 
be classified no lower than the highest level of classified information 
that is protected by the combination lock. When securing a combination 
lock, the dial must be turned at least four (4) complete times in the 
same direction after closing. Defects in or malfunctioning of storage 
equipment protecting classified national security or officially limited 
information must be reported immediately to the designated office or 
bureau security official for appropriate action.
    (2) Equipment Out of Service. When security equipment, used for the 
storage of classified national security or officially limited 
information, is taken out of service, it shall be physically inspected 
to ensure that no classified information or officialy limited 
information remains therein. Built-in, three-position, dial-type, 
changeable, combination locks shall be reset to the standard combination 
50-25-50 and combination padlocks shall be reset to the standard 
combination 10-20-30. The designated security officer in each Treasury 
bureau and the Departmental Offices shall prescribe such supplementary 
controls deemed necessary to fulfill their individual needs to be 
consistent with Sec. 2.27.
    (3) Security Container Check Sheet. Each piece of security equipment 
used for the storage of classified information will have attached 
conspicuously to the outside a Standard Form 702 (Security Container 
Check Sheet) on which an authorized person will record the date and 
actual time each business day that they initially unlock and finally 
lock the security equipment, followed by their initials. Users of this 
form are to avoid citations which reflect the opening, locking and 
checking of the security equipment at standardized (non-actual) times, 
e.g., opened at 8:00 a.m. and closed/checked at 4:00 p.m. Bureaus and 
the Departmental Offices may continue to use Optional Form 62 (Safe or 
Cabinet Security Record) in lieu of the SF 702 until September 30, 1990, 
or such time as their supplies of Optional Form 62 are exhausted. The 
reprinting or photostatic reproduction and use of Optional Form 62 is 
not authorized. On each normal workday, regardless of whether the 
security equipment was opened on that particular day, the security 
equipment shall be checked by authorized personnel to assure that no 
surreptitious attempt has been made to penetrate the security equipment. 
Such examinations normally consist of a quick or casual visual check to 
note either any obvious marks or gashes, or defects or malfunction of 
the security equipment which are different from their prior observations 
or experience in operating the equipment concerned. Any such 
discrepancies in the appearance of or functioning of the security 
equipment, based upon this visual check, should be reported to 
appropriate security officials. The ``Checked By'' column of the SF 702 
or Optional Form 62 shall be annotated to reflect the date and time of 
this action followed by that person's initials. Security equipment used 
for the storage of classified information that has been opened on a 
particular day shall not be left unattended at the end of that day until 
it has been locked by an authorized person and checked by a second 
person. In the event a second person is not available within the office, 
the individual who locked the equipment shall also annotate the 
``Checked By'' column of the SF 702 or Optional Form 62. Reversible 
``OPEN-CLOSED'' or ``LOCKED-UNLOCKED'' signs, available through normal 
supply channels, shall also be used on such security equipment. The 
respective side of the sign shall be displayed to indicate when the 
container is open or closed. Except for the SF 702 or Optional Form 62, 
the top surface area of security equipment is not to be used for

[[Page 101]]

storage and must be kept free of extraneous material. SF 702 and/or 
Optional Form 62 shall be utilized on all security equipment used for 
storing information bearing the control legend ``Limited Official Use''. 
The designated security officer in each Treasury bureau and the 
Department Offices may, as warranted, prescribe supplementary use of the 
SF 702 or Optional Form 62 to apply to other authorized legends approved 
by the Department for officially limited information.
    (4) Safe Combination Records. Combinations to security equipment 
containing classified information shall be recorded on Standard Form 700 
(Security Container Information), national stock number 7540-01-214-
5372. Bureaus and the Departmental Offices may continue to use Treasury 
Form 4032 (Security Container Information) in lieu of the SF 700 until 
September 30, 1990, or such time as their supplies of Treasury Form 4032 
are exhausted. The reprinting of Treasury Form 4032 is not authorized. 
Each part of the SF 700 shall be completed in its entirety. The names, 
addresses and home telephone numbers of personnel responsible for the 
combination, and the classified information stored therein, must be 
indicated on part 1 of the SF 700. The completed part 1 shall be posted 
in the front interior of the top, control or locking drawer of the 
security equipment concerned. Part 2 shall be inserted in the envelop 
(part 2A) provided, and forwarded via appropriate secure means to the 
designated bureau or Departmental Offices central repository for 
security combinations. Part 2 shall have the highest level of classified 
information, stored in the security equipment concerned, annotated in 
both the top and bottom border areas of the completed SF 700. Part 2A 
shall have the highest level of classified information, stored in the 
security equipment concerned, annotated in the blank space immediately 
above the word, ``WARNING'' which appears on the SF 700. The completion 
of the SF 700 or Treasury Form 4032 does not constitute a classification 
action but serves as an administrative requirement to ensure the 
protection of classified information stored in such security equipment. 
SF 700 shall be utilized on all security equipment used for storing 
information bearing the control legend ``Limited Official Use''. The 
designated security officer in each Treasury bureau and the Departmental 
Offices may prescribe supplementary use of the SF 700 to apply to other 
authorized legends approved by the Department for officially limited 
information, as warranted.
    (c) Keys. The designated security officer in each Treasury bureau 
and the Departmental Offices shall establish administrative procedures 
for the control and accountability of keys and locks whenever key-
operated, high-security padlocks are utilized. The level of protection 
provided such keys shall be equivalent to that afforded the information 
being protected by the padlock.
    (d) Classified Document Cover Sheets. Classified document cover 
sheets alert personnel that documents or folders are classified and 
require protection from unauthorized scrutiny. Individuals who prepare 
or package classified documents are responsible for affixing the 
appropriate document cover sheet. Orange Standard Form 703 (Top Secret 
Cover Sheet), red SF 704 (Secret Cover Sheet) and blue SF 706 
(Confidential Cover Sheet) are the only authorized cover sheets for 
collateral classified information. The national stock numbers of these 
cover sheets are as follows: SF 703, 7540-01-213-7901; SF 704, 7540-01-
213-7902; and SF 705, 7540-01-213-7903. In order to maintain the 
integrity of the color coding process the photocopying and use of non-
color coded classified document cover sheets is prohibited. Bureaus and 
offices shall maintain a supply of classified document cover sheets 
appropriate for their needs. Classified document cover sheets are 
designed to be reused and will be removed before classified information 
is filed to conserve filing space and prior to the destruction of 
classified information. Document cover sheets are to be used to shield 
classified documents while in use and particularly when the transmission 
is made internally within a headquarters by courier, messenger or by 
personal contact. File folders containing classified information should 
be otherwise marked, e.g., at the top and bottom of the front and

[[Page 102]]

back covers, to indicate the overall classification of the contents 
rather than permanently affixing the respective classified document 
cover sheet. Treasury Directive 71-02 provides for the use of a green 
cover sheet, TD F 71-01.6 (Limited Official Use Document Cover Sheet) 
for information bearing the control legend ``Limited Official Use''. 
Bureaus or offices electing to create and use other cover sheets for 
officially limited information must obtain prior written approval from 
the Departmental Director of Security.
    (e) Activity Security Checklist. Standard Form 701 (Activity 
Security Checklist) provides a systematic means to make a thorough end-
of-day security inspection for a particular work area and to allow for 
employee accountability in the event that irregularities are discovered. 
Bureaus and the Departmental Offices may include additional information 
on the SF 701 to suit their unique needs. The SF 701, available through 
normal supply channels has a national stock number of 7540-01-213-7900. 
It shall be the only form used in situations that call for use of an 
activity security checklist. Completion, storage and disposition of SF 
701 will be determined by each bureau and the Departmental Offices.



Sec. 2.28  Transmittal [4.1(b)].

    (a) Preparation. Classified information to be transmitted outside of 
a Treasury facility shall be enclosed in opaque inner and outer covers. 
The inner cover shall be a sealed wrapper or envelope plainly marked 
with the assigned security classification and addresses of both sender 
and addressee. The outer cover shall be sealed and addressed with no 
identification of the classification of its contents. Whenever 
classified material is to be transmitted and the size of the material is 
not suitable for use of envelopes or similar wrappings, it shall be 
enclosed in two opaque sealed containers, such as boxes or heavy 
wrappings. Material used for packaging such bulk classified information 
shall be of sufficient strength and durability as to provide security 
protection while in transit, to prevent items from breaking out of the 
container, and to facilitate detection of any tampering therewith.
    (b) Receipting. A receipt, Treasury Department Form 71-01.5 
(Classified Document Record of Transmittal), shall be enclosed in the 
inner cover, except that Confidential and Limited Official Use 
information shall require a receipt only if the sender deems it 
necessary. The receipt shall identify the sender, addressee and describe 
the document, but shall contain no classified information. It shall be 
immediately signed by the recipient and returned to the sender. Within a 
Treasury facility, such information may be transmitted between offices 
by direct contact of the officials concerned in a single sealed opaque 
envelope with no security classification category being shown on the 
outside of the envelope. Classified information shall never be delivered 
to unoccupied offices or rooms. Senders of classified information should 
maintain appropriate records of outstanding receipts for which return of 
the original signed copy is still pending. TD F's 71-01.5 shall be 
maintained for a three year period after which they may be destroyed. No 
record of the actual destruction of the TD F 71-01.5 is required.
    (c) Transmittal of Top Secret. The transmittal of Top Secret 
information outside of a Treasury facility shall be by specifically 
designated personnel, by State Department diplomatic pouch, by a 
messenger-courier system authorized for that purpose, e.g., Defense 
Courier Service, or over authorized secure communications circuits. Top 
Secret information may not be sent via registered mail.
    (d) Transmittal of Secret. The transmittal of Secret information 
shall be effected in the following manner:
    (1) The 50 States, District of Columbia and Puerto Rico. Secret 
information may be transmitted within and between the 50 States, the 
District of Columbia, and the Commonwealth of Puerto Rico by one of the 
means authorized for Top Secret information, by the United States Postal 
Service registered mail or express mail service; or by protective 
services provided by United States air or surface commercial carriers 
under such conditions as may be prescribed by the Departmental Director 
of Security. United States Postal Service express mail service

[[Page 103]]

shall be used only when it is the most effective means to accomplish a 
mission within security, time, cost and accountability constraints. To 
ensure direct delivery to the addressee, the ``Waiver of Signature and 
Indemnity'' block on the United States Postal Service Express Mail Label 
11-B may not be executed under any circumstances. All Secret express 
mail shipments are to be processed through mail distribution centers or 
delivered directly to a United States Postal Service facility or 
representative. The use of external (street side) express mail 
collection boxes is prohibited. Only the express mail services of the 
United States Postal Service are authorized.
    (2) Other Areas. Secret information may be transmitted from, to, or 
within areas other than those specified in Sec. 2.28(d)(1) by one of 
the means established for Top Secret information, or by United States 
registered mail through Military Postal Service facilities provided that 
the information does not at any time pass out of United States citizen 
control and does not pass through a foreign postal system. Transmittal 
outside such areas may also be accomplished under escort of 
appropriately cleared personnel aboard United States Government owned 
and United States Government contract vehicles or aircraft, ships of the 
United States Navy, civil service manned United States Naval ships, and 
ships of United States Registry. Operators of vehicles, captains or 
masters of vessels, and pilots of aircraft who are United States 
citizens, and who are appropriately cleared, may be designated as 
escorts. Secret information may not be sent via certified mail.
    (e) Transmittal of Confidential and Limited Official Use 
Information. Confidential and Limited Official Use information shall be 
transmitted within and between the 50 States, the District of Columbia, 
the Commonwealth of Puerto Rico, and United States territories or 
possessions by one of the means established for higher classifications, 
or by the United States Postal Service registered mail. Outside these 
areas, confidential and Limited Official Use information shall be 
transmitted only as is authorized for higher classifications. 
Confidential and Limited Official Use information may not be sent via 
certified mail.
    (f) Hand Carrying of Classified Information in Travel Status--(1) 
General Provisions. Personnel in travel status shall physically 
transport classified information across international boundaries only 
when absolutely essential. Whenever possible, and when time permits, the 
most desirable way to transmit classified information to the location 
being visited is by other authorized means identified in Sec. 2.28 (c), 
(d) and (e). The physical transportation of classified information on 
non-United States flag aircraft should be avoided if possible. Treaury 
Directive 71-03, ``Screening of Airline Passengers Carrying Classified 
Information or Material'' provides specifics on the requirements for 
transporting classified information.
    (2) Specific Safeguards. If it is determined that the transportation 
of classified information by an individual in travel status is in the 
best interest of the United States Government, the following specific 
safeguards shall be fulfilled:
    (i) Classified information shall be in the physical possession of 
the individual and shall have adequate safeguards at all times if proper 
storage at a United States Government facility is not available. Under 
no circumstances shall classified information be stored in a hotel safe 
or room, locked in automobiles, private residences, train compartments, 
or any vehicular detachable storage compartments.
    (ii) An inventory of all Top Secret classified information, 
including teletype messages, shall be made prior to departure and a copy 
of same shall be retained by the traveller's office until the 
traveller's return at which time all Top Secret classified information 
shall be accounted for. These same procedures are recommended for 
information classified Secret, Confidential or Limited Official Use.
    (iii) Classified information shall never be displayed or used in any 
manner in public conveyances or rooms. First class or business travel is 
not authorized when the justification for commercially available 
transportation

[[Page 104]]

is based on the need for reviewing classified materials while enroute. 
Travelers are responsible for reviewing and familiarizing themselves 
with required classified materials, under appropriately secure 
circumstances, in advance of their travel and not during such travel.
    (iv) In order to avoid unnecessary delays in the screening process 
prior to boarding commercial air carriers, the traveler shall have in 
his or her possession written authorization, on Treasury or bureau 
letterhead, to transport classified information and either an 
identification card or credential bearing both a photograph and 
descriptive data. Courier authorizations shall be signed by an 
appropriate security representative authorized to direct official 
travel. This courier authorization, along with official travel orders, 
shall, in most instances, permit the individual to exempt the classified 
information from inspection. If difficulty is encountered, the traveler 
should tactfully refuse to exhibit or disclose the classified 
information to inspection and should insist on the assistance of the 
local United States diplomatic representative at the port of entry or 
departure.
    (v) Upon completion of the visit, the traveler shall have the 
information returned to his or her office by approved means. All Top 
Secret and Secret classified information, including teletype messages 
transported for the purpose of the visit shall be accounted for. It is 
highly recommended that Confidential and Limited Official Use 
information also be accounted for. If any Top Secret or Secret 
classified items are left with the office being visited for its 
retention and use, the individual shall obtain a receipt.

[55 FR 1644, Jan. 17, 1990, as amended at 55 FR 50321, Dec. 6, 1990]



Sec. 2.29  Telecommunications and computer transmissions.

    Classified information shall not be communicated by 
telecommunications or computer transmissions except as may be authorized 
with respect to the transmission of classified information over 
authorized secure communications circuits or systems.



Sec. 2.30  Special access programs [1.2(a) and 4.2(a)].

    Only the Secretary of the Treasury may create or continue a special 
access program if:
    (a) Normal management and safeguarding procedures do not limit 
access sufficiently; and
    (b) The number of persons with access is limited to the minimum 
necessary to meet the objective of providing extra protection for the 
information.



Sec. 2.31  Reproduction controls [4.1(b)].

    (a) Top Secret documents, except for the controlled initial 
distribution of information processed or received electronically, shall 
not be reproduced without the consent of the originator.
    (b) Unless restricted by the originating agency, Secret, 
Confidential and Limited Official Use documents may be reproduced to the 
extent required by operational needs.
    (c) Reproductions of classified documents shall be subject to the 
same accountability and controls as the original documents.
    (d) Paragraphs (a) and (b) of this section shall not restrict the 
reproduction of documents to facilitate review for possible 
declassification.



Sec. 2.32  Loss or possible compromise [4.1(b)].

    (a) Report of Loss or Possible Compromise. Any Treasury employee who 
has knowledge of the loss or possible compromise or classified 
information shall immediately report the circumstances to their 
designated office or bureau security officer who shall take appropriate 
action to assess the degree of damage. In turn, the Departmental 
Director of Security shall be immediately notified by the affected 
office or bureau security officer of such reported loss or possible 
compromise. The Departmental Director of Security shall also notify the 
department or agency which originated the information and any other 
interested department or agency so that a damage assessment may be 
conducted and appropriate measures taken to negate or minimize any 
adverse effect of the loss or possible compromise. Compromises

[[Page 105]]

may occur through espionage, unauthorized disclosures to the press or 
other members of the public, publication of books and treatises, the 
known loss of classified information or equipment to foreign powers, or 
through various other circumstances.
    (b) Inquiry. The Departmental Director of Security shall notify the 
Assistant Secretary (Management) who shall then direct an immediate 
inquiry to be conducted for the purpose of taking corrective measures 
and assessing damages. Based on the results of this inquiry, it may be 
deemed appropriate to notify the Inspector General who shall determine 
whether the Office of the Inspector General or a Treasury bureau will 
conduct any additional investigation. Upon completion of the 
investigation by the Inspector General, the Inspector General shall 
recommend to the Assistant Secretary (Management) and concurrently to 
the Departmental Director of Security, the appropriate administrative, 
disciplinary, or legal action to be taken based upon jurisdictional 
authority of the Treasury components involved.
    (c) Content of Damage Assessments. At a minimum, damage assessments 
shall be in writing and contain the following:
    (1) Identification of the source, date and circumstances of the 
compromise.
    (2) Classification and description of the specific information which 
has been lost.
    (3) An analysis and statement of the known or probable damage to the 
national security that has resulted or may result.
    (4) An assessment of the possible advantage to foreign powers 
resulting from the compromise.
    (5) An assessment of whether,
    (i) The classification of the information involved should be 
continued without change;
    (ii) The specific information, or parts thereof, shall be modified 
to minimize or nullify the effects of the reported compromise and the 
classification retained;
    (iii) Downgrading, declassification, or upgrading is warranted, and 
if so, confirmation of prompt notification to holders of any change, and
    (6) An assessment of whether countermeasures are appropriate and 
feasible to negate or minimize the effect of the compromise.
    (d) System for Control of Damage Assessments. Each Treasury bureau 
and the Departmental Offices shall establish a system of control and 
internal procedures to ensure that damage assessments are performed in 
all cases described in Sec. 2.32(a) and that records are maintained in 
a manner that facilitates their retrieval and use within the Department.
    (e) Cases Involving More Than One Agency. (1) Whenever a compromise 
involves the classified information or interests of more than one 
agency, the Departmental Director of Security shall advise the other 
affected agencies of the circumstances and findings that affect their 
information or interests. Whenever a damage assessment, incorporating 
the product of two or more agencies is needed, the affected agencies 
shall agree upon the assignment of responsibility for the assessment and 
Treasury components will provide all data pertinent to the compromise to 
the agency responsible for conducting the assessment.
    (2) Whenever a compromise of United States classified information is 
the result of actions taken by foreign nationals, by foreign government 
officials, or by United States nationals in the employ of international 
organizations, the agency performing the damage assessment shall 
endeavor to ensure through appropriate intergovernmental liaison 
channels, that information pertinent to the assessment is obtained. 
Whenever more than one agency is responsible for the assessment, those 
agencies shall coordinate the request prior to transmittal through 
appropriate channels.
    (3) Whenever an action is contemplated against any person believed 
responsible for the loss or compromise of classified information, damage 
assessments shall be coordinated with appropriate legal counsel. 
Whenever a violation of criminal law appears to have occured and a 
criminal prosecution is contemplated, coordination shall be made with 
the Department of Justice.

[[Page 106]]

    (4) The designated representative of the Director of Central 
Intelligence, or other appropriate officials with responsibility for the 
information involved, will be consulted whenever a compromise of 
sensitive compartmented information has occurred.



Sec. 2.33  Responsibilities of holders [4.1(b)].

    Any person having access to and possession of classified information 
is responsible for protecting it from persons not authorized access, 
i.e., persons who do not possess an appropriate security clearance, and 
who do not possess the required need-to-know. This includes keeping 
classified documents under constant observation and turned face-down or 
covered when not in use and securing such information in approved 
security equipment or facilities whenever it is not under the direct 
supervision of authorized persons. In all instances, such protective 
means must meet accountability requirements prescribed by the 
Department.



Sec. 2.34  Inspections [4.1(b)].

    Individuals charged with the custody of classified information shall 
conduct the necessary inspections within their areas to ensure adherence 
to procedural safeguards prescribed to protect classified information. 
Security officers shall ensure that periodic inspections are made to 
determine whether procedural safeguards prescribed by this regulation 
and any bureau implementing regulation are in effect at all times. At a 
minimum such checks shall ensure that all classified information is 
stored in approved security containers, including removable storage 
media, e.g., floppy disks used by word processors that contain 
classified information; burn bags, if utilized, are either stored in 
approved security containers or destroyed; and classified shorthand 
notes, carbon paper, carbon and plastic typewriter ribbons, rough drafts 
and similar papers have been properly stored or destroyed.



Sec. 2.35  Security violations.

    Any individual, at any level of employment, determined to have been 
responsible for the unauthorized release or disclosure or potential 
release or disclosure of classified national security information, 
whether it be knowingly, willfully or through negligence, shall be 
notified on TD F 71-21.1 (Record of Security Violation) that his or her 
action is in violation of this regulation, the Order, the Directive, and 
Executive Order 10450, as amended. Treasury Directive 71-04, entitled, 
``Administration of Security Violations'' sets forth provisions 
concerning security violations which shall apply to each Treasury 
employee and persons under contract or subcontract to the Department 
authorized access to Treasury classified national security information.
    (a) Repeated abuse of the classification process, either by 
unnecessary or over-classification, or repeated failure, neglect or 
disregard of established requirements for safeguarding classified 
information by any employee shall be grounds for appropriate adverse or 
disciplinary action. Such actions may include, but are not necessarily 
limited to, a letter of warning, a letter of reprimand, suspension 
without pay, or dismissal, as appropriate in the particular case, under 
applicable personnel rules, regulations and procedures. Where a 
violation of criminal statutes may be involved, any such case shall be 
promptly referred to the Department of Justice.
    (b) After an affirmative adjudication of a security violation, and 
as the occasion demands, reports of accountable security violations 
shall be placed in the employee's personnel security file, and as 
appropriate, in the employee's official personnel folder. The security 
official of the office or bureau concerned shall recommend to the 
respective management official or bureau head that disciplinary action 
be taken when such action is indicated.



Sec. 2.36  Disposition and destruction [4.1(b)].

    Classified information no longer needed in current working files or 
for reference or record purposes shall be processed for appropriate 
disposition in accordance with the provisions of Title 44, United States 
Code, Chapters 21 and 33, which govern disposition of Federal

[[Page 107]]

records. Classified information approved for destruction shall be 
destroyed by either burning, melting, chemical decomposition, pulping, 
mulching, pulverizing, cross-cut shredding or other mutilation in the 
presence of appropriately cleared and authorized persons. The method of 
destruction must preclude recognition or reconstruction of the 
classified information. The residue from cross-cut shredding of Top 
Secret, Secret, and Confidential classified, non-Communications Security 
(COMSEC), information contained in paper media may not exceed \3/
32\ by \1/2\ with a \1/64\ tolerance.
    (a) Diskettes or Floppy Disks. Diskettes or floppy disks containing 
information or data classified up to and including Top Secret may be 
destroyed by the use of an approved degausser, burning, pulverizing, and 
chemical decomposition, or by first reformatting or reinitializing the 
diskette then physically removing the magnetic disk from its protective 
sleeve and using an approved cross-cut shredder to destroy the magnetic 
media. Care must be exercised to ensure that the destruction of magnetic 
disks does not damage the cross-cut shredder. The residue from such 
destruction, however, may not exceed \1/32\ by \1/
2\ with a \1/64\ tolerance. The destruction of 
classified COMSEC information on diskettes or floppy disks may only be 
effected by burning followed by crushing of the ash residue.
    (b) Hard Disks. Hard disks, including removable hard disks, disk 
packs, drums or single disk platters that contain classified information 
must first be degaussed prior to physical destruction. The media must be 
destroyed by incineration, chemical decomposition or the entire magnetic 
disk pack, drum, or platter recording surface must be obliterated by use 
of an emery wheel or disk sander.
    (c) Approval of Use of Mulching and Cross-cut Shredding Equipment. 
Prior to obtaining mulching or cross-cut shredding equipment, the 
Departmental Director of Security shall approve the use of such 
equipment.
    (d) Use of Burnbags. Any classified information to be destroyed by 
burning shall be torn and placed in opaque containers, commonly 
designated as burnbags, which shall be clearly and distinctly labeled 
``BURN'' or ``CLASSIFIED WASTE''. Burnbags awaiting destruction are to 
be protected by security safeguards commensurate with the classification 
or control designation of the information involved.
    (e) Records of Destruction. Appropriate accountability records shall 
be maintained on TD F 71-01.17 (Classified Document Certificate of 
Destruction) to reflect the destruction of all Top Secret and Secret 
information. As deemed necessary by the originator, or as required by 
special regulations, the TD F 71-01.17 shall be executed for the 
destruction of information classified Confidential or marked Limited 
Official Use. TD F's 71-01.17 shall be maintained for a three-year 
period after which the form may be destroyed. No record of the actual 
destruction of the TD F 71-01.17 is required.
    (f) Destruction of non-record Classified Information. Non-record 
classified information such as extra copies and duplicates, including 
shorthand notes, preliminary drafts, used carbon paper and other 
material of similar temporary nature, shall also be destroyed by 
burning, mulching, or cross-cut shredding as soon as it has served its 
purpose, but no records of such destruction need be maintained.

[55 FR 1644, Jan. 17, 1990; 55 FR 5118, Feb. 13, 1990]



Sec. 2.37  National Security Decision Directive 197.

    National Security Decision Directive 197, Reporting Hostile Contacts 
and Security Awareness, provides that United States Government employees 
are responsible for reporting to their designated security officer:
    (a) Any suspected or apparent attempt by persons, regardless of 
nationality, to obtain unauthorized access to classified national 
security information, sensitive or proprietary information or technology 
and/or;
    (b) Instances in which they feel they are being targeted for 
possible exploitation. Contacts with representatives of designated 
countries of concern identified in Sec. 2.43(f) which involve requests 
for information which are not ordinarily provided in the course of an 
employee's job, regular or daily activity, and/or which might possibly 
lead

[[Page 108]]

to further requests for access to sensitive, proprietary or classified 
information or technology, are to be reported to designated security 
officers. Reports of such contacts are to be forwarded by the designated 
security officer to the Departmental Director of Security for 
appropriate action and coordination.



                   Subpart E_Implementation and Review



Sec. 2.38  Departmental management.

    (a) The Assistant Secretary (Management) shall:
    (1) Enforce the Order, the Directive and this regulation, and 
establish, coordinate and maintain active training, orientation and 
inspection programs for employees concerned with classified information.
    (2) Review suggestions and complaints regarding the administration 
of this regulation.
    (b) Pursuant to Treasury Directive 71-08, ``Delegation of Authority 
Concerning Physical Security Programs'', the Departmental Director of 
Security shall:
    (1) Review all bureau implementing regulations prior to publication 
and shall require any regulation to be changed, if it is not consistent 
with the Order, the Directive or this regulation.
    (2) Have the authority to conduct on-site reviews of bureau physical 
security programs and information security programs as they pertain to 
each Treasury bureau and to require such reports, information and 
assistance as may be necessary, and
    (3) Serve as the principal advisor to the Assistant Secretary 
(Management) with respect to Treasury physical and information security 
programs.



Sec. 2.39  Bureau administration.

    Each Treasury bureau and the Departmental Offices shall designate, 
in writing to the Departmental Director of Security, an officer or 
official to direct, coordinate and administer its physical security and 
information security programs which shall include active oversight to 
ensure effective implementation of the Order, the Directive, this 
regulation. Bureaus and the Departmental Offices shall revise their 
existing implementing regulation on national security information to 
ensure conformance with this regulation. Time frames for bureau and 
Departmental Offices implementation shall be established by the 
Departmental Director of Security.



Sec. 2.40  Emergency planning [4.1(b)].

    Each Treasury bureau and the Departmental Offices shall develop 
plans for the protection, removal, or destruction of classified 
information in case of fire, natural disaster, civil disturbance, or 
possible enemy action. These plans shall include the disposition of 
classified information located in foreign countries.



Sec. 2.41  Emergency authority [4.1(b)].

    The Secretary of the Treasury may prescribe by regulation special 
provisions for the dissemination, transmittal, destruction, and 
safeguarding of national security information during combat or other 
emergency situations which pose an imminent threat to national security 
information.



Sec. 2.42  Security education [5.3(a)].

    Each Treasury bureau that creates, processes or handles national 
secutity information, including the Departmental Offices, is required to 
establish a security education program. The program shall be sufficient 
to familiarize all necessary personnel with the provisions of the Order, 
the Directive, this regulation and any other implementing directives and 
regulations to impress upon them their individual security 
responsibilities. The program shall also provide for initial, refresher, 
and termination briefings.
    (a) Briefing of Employees. All new employees concerned with 
classified information shall be afforded a security briefing regarding 
the Order, the Directive and this regulation and sign a security 
agreement as required in Sec. 2.22(c). Employees concerned with 
sensitive compartmented information shall be required to read and also 
sign a security agreement. Copies of applicable laws and pertinent 
security regulations setting forth the procedures for the protection and 
disclosure of classified information shall be available for all new 
employees afforded a security

[[Page 109]]

briefing. All employees given a security briefing shall be required to 
sign a TD F 71-01.16 (Physical Security Orientation Acknowledgment) 
which shall be maintained on file as determined by respective office or 
bureau security officials.
    (b) [Reserved]



                      Subpart F_General Provisions



Sec. 2.43  Definitions [6.1].

    (a) Authorized Person. Those individuals who have a ``need-to-know'' 
the classified information involved and have been cleared for the 
receipt of such information. Responsibility for determining whether 
individuals' duties require that they possess, or have access to, any 
classified information and whether they are authorized to receive it 
rests on the individual who has possession, knowledge, or control of the 
information involved, and not on the prospective recipients.
    (b) Compromise. The loss of security enabling unauthorized access to 
classified information. Affected information or material is not 
automatically declassified.
    (c) Confidential Source. Any individual or organization that has 
provided, or that may reasonably be expected to provide, information to 
the United States on matters pertaining to the national security with 
the expectation, expressed or implied, that the information or 
relationship, or both, be held in confidence.
    (d) Declassification. The determination that particular classified 
information no longer requires protection against unauthorized 
disclosure in the interest of national security. Such determination 
shall be by specific action or occur automatically after the lapse of a 
requisite period of time or the occurrence of a specified event. If such 
determination is by specific action, the information or material shall 
be so marked with the new designation.
    (e) Derivative Classification. A determination that information is, 
in substance, the same as informaiton that is currently classified and a 
designation of the level of classification.
    (f) Designated Countries of Concern. For purposes of National 
Security Decision Directive 197 reporting: Afghanistan, Albania, Angola, 
Bulgaria, Cambodia (Kampuchea), the People's Republic of China 
(Communist China), Cuba, Czechoslovakia, Ethiopia, East Germany (German 
Democratic Republic including the Soviet sector of Berlin), Hungary, 
Iran, Iraq, Laos, Libya, Mongolian People's Republic (Outer Mongolia), 
Nicaragua, North Korea, Palestine Liberation Organization, Poland, 
Romania, South Africa, South Yemen, Syria, Taiwan, Union of Soviet 
Socialist Republics (Russia), Vietnam and Yugoslavia.
    (g) Document. Any recorded information regardless of its physical 
form or characteristics, including, without limitation, written or 
printed material; data processing cards and tapes; maps, charts; 
painting; drawings; engravings; sketches; working notes and papers; 
reproductions of such things by any means or process; and sound, voice, 
or electronic recordings in any form.
    (h) Foreign Government Information. (1) Information provided by a 
foreign government or governments, an international organization of 
governments, or any elements thereof with the expectation, expressed or 
implied, that the information, the source of the information, or both, 
are to be held in confidence; or
    (2) Information produced by the United States Government pursuant to 
or as a result of a joint arrangement with a foreign government or 
governments or an international organization of governments, or any 
element thereof, requiring that the information, the arrangement, or 
both, are to be held in confidence.
    (i) Information. Any data or material, regardless of its physical 
form or characteristics, that is owned by, produced by or for, or is 
under the control of the United States Government.
    (j) Information Security. The administrative policies and procedures 
for identifying, controlling, and safeguarding from unauthorized 
disclosure, information the protection of which is authorized by 
Executive Order or statute.
    (k) Intelligence Activity. An activity that an agency within the 
Intelligence Community is authorized to conduct pursuant to Executive 
Order 12333.

[[Page 110]]

    (l) Intelligence Sources and Methods. A person, organization, or 
technical means or method which provides foreign intelligence or foreign 
counterintelligence to the United States and which, if its identity or 
capability is disclosed, is vulnerable to counteraction that could 
nullify or significantly reduce its effectiveness in providing foreign 
intelligence or foreign counterintelligence to the United States. An 
intelligence source also means a person or organization which provides 
foreign intelligence or foreign counterintelligence to the United States 
only on the condition that its identity remains undisclosed. 
Intelligence methods are that which, if disclosed, reasonably could lead 
to the disclosure of an intelligence source or operation.
    (m) Limited Official Use. The legend authorized for ``Officially 
Limited Information'' which provides that it be handled, safeguarded and 
stored in a manner equivalent to national security information 
classified Confidential.
    (n) Multiple Classified Sources. The term used to indicate that a 
document is derivatively classified when it contains classified 
information derived from other than one source.
    (o) National Security. The national defense or foreign relations of 
the United States.
    (p) National Security Information. Information that has been 
determined pursuant to the Order or any predecessor Executive Order to 
require protection against unauthorized disclosure and that is so 
designated.
    (q) Need-to-Know. A determination made by the possessor of 
classified information that a prospective recipient, in the interest of 
national security, has a requirement for access to, knowledge of, or 
possession of the classified information in order to perform tasks or 
services essential to the fulfillment of particular work, including 
performance on contracts for which such access is required.
    (r) Officially Limited Information. Information which does not meet 
the criterion that unauthorized disclosure would at least cause damage 
to the national security under the Order or a predecessor Executive 
Order, but which concerns important, delicate, sensitive or proprietary 
information which is utilized in the development of Treasury policy. 
This includes the enforcement of criminal and civil laws relating to 
Treasury operations, the making of decisions on personnel matters and 
the consideration of financial information provided in confidence.
    (s) Original Classification. An initial determination that 
information requires, in the interest of national security, protection 
against unauthorized disclosure, together with a classification 
designation signifying the level of protection required.
    (t) Original Classification Authority. The authority vested in an 
Executive Branch official to make an initial determination that 
information requires protection against unauthorized disclosure in the 
interest of national security.
    (u) Originating Agency. The agency responsible for the initial 
determination that particular information is classified.
    (v) Portion. A segment of a document for purposes of expressing a 
unified theme; ordinarily a paragraph.
    (w) Sensitive Compartmented Information. Information and material 
concerning or derived from intelligence sources, methods, or analytical 
processes, that requires special controls for restricting handling 
within compartmented intelligence systems established by the Director of 
Central Intelligence and for which compartmentation is established.
    (x) Special Access Program. Any program imposing ``need-to-know'' or 
access controls beyond those normally provided for access to 
Confidential, Secret, or Top Secret information. Such a program may 
include, but is not limited to, special clearance, adjudication, or 
investigative requirements, special designations of officials authorized 
to determine ``need-to-know'' or special lists of persons determined to 
have a ``need-to-know''.
    (y) Special Activity. An activity conducted in support of national 
foreign policy objectives abroad which is planned and executed so that 
the role of the United States Government is not apparent or acknowledged 
publicly,

[[Page 111]]

and functions in support of such activity, but which is not intended to 
influence United States political processes, public opinion, policies or 
media and does not include diplomatic activities or the collection and 
production of intelligence or related support functions.
    (z) Unauthorized Disclosure. A communication or physical transfer of 
classified information to an unauthorized recipient. It includes the 
unauthorized disclosure of classified information in a newspaper, 
journal, or other publication where such information is traceable due to 
a direct quotation or other uniquely identifiable fact.



PART 3_CLAIMS REGULATIONS AND INDEMNIFICATION OF DEPARTMENT OF TREASURY 
EMPLOYEES--Table of Contents




           Subpart A_Claims Under the Federal Tort Claims Act

Sec.
3.1 Scope of regulations.
3.2 Filing of claims.
3.3 Legal review.
3.4 Approval of claims not in excess of $25,000.
3.5 Limitations on authority to approve claims.
3.6 Final denial of a claim.
3.7 Action on approved claims.
3.8 Statute of limitations.

               Subpart B_Claims Under the Small Claims Act

3.20 General.
3.21 Action by claimant.
3.22 Legal review.
3.23 Approval of claims.
3.24 Statute of limitations.

      Subpart C_Indemnification of Department of Treasury Employees

3.30 Policy.

    Authority: 28 U.S.C. 2672; 28 CFR part 14; 5 U.S.C. 301.

    Source: 35 FR 6429, Apr. 22, 1970, unless otherwise noted.



           Subpart A_Claims Under the Federal Tort Claims Act



Sec. 3.1  Scope of regulations.

    (a) The regulations in this part shall apply to claims asserted 
under the Federal Tort Claims Act, as amended, 28 U.S.C. 2672, accruing 
on or after January 18, 1967, for money damages against the United 
States for injury to or loss of property or personal injury or death 
caused by the negligent or wrongful act or omission of an employee of 
the Department while acting within the scope of his office or 
employment, under circumstances where the United States if a private 
person, would be liable to the claimant for such damage, loss, injury, 
or death, in accordance with the law of the place where the act or 
omission occurred. The regulations in this subpart do not apply to any 
tort claims excluded from the Federal Tort Claims Act, as amended, under 
28 U.S.C. 2680.
    (b) Unless specifically modified by the regulations in this part, 
procedures and requirements for filing and handling claims under the 
Federal Tort Claims Act shall be in accordance with the regulations 
issued by the Department of Justice, at 28 CFR part 14, as amended.



Sec. 3.2  Filing of claims.

    (a) When presented. A claim shall be deemed to have been presented 
upon the receipt from a claimant, his duly authorized agent or legal 
representative of an executed Standard Form 95 or other written 
notification of an incident, accompanied by a claim for money damages in 
a sum certain for injury to or loss of property, or personal injury, or 
death alleged to have occurred by reason of the incident.
    (b) Place of filing claim. Claims shall be submitted directly or 
through the local field headquarters to the head of the bureau or office 
of the Department out of whose activities the incident occurred, if 
known; or if not known, to the General Counsel, Treasury Department, 
Washington, DC 20220.
    (c) Contents of claim. The evidence and information to be submitted 
with the claim shall conform to the requirements of 28 CFR 14.4.



Sec. 3.3  Legal review.

    Any claim that exceeds $500, involves personal injuries or 
automobile damage, or arises out of an incident that is likely to result 
in multiple claimants, shall be forwarded to the legal division

[[Page 112]]

of the bureau or office out of whose activities the claim arose. The 
claim, together with the reports of the employee and the investigation, 
shall be reviewed in the legal division which shall thereupon make a 
recommendation that the claim be approved, disapproved, or compromised, 
and shall advise on the need for referral of the claim to the Department 
of Justice. This recommendation and advice, together with the file, 
shall be forwarded to the head of the bureau or office or his designee.

[35 FR 6429, Apr. 22, 1970, as amended at 48 FR 16253, Apr. 15, 1983]



Sec. 3.4  Approval of claims not in excess of $25,000.

    (a) Claims not exceeding $25,000 and not otherwise requiring 
consultation with the Department of Justice pursuant to 28 CFR 14.6(b) 
shall be approved, disapproved, or compromised by the head of the bureau 
or office or his designee, taking into consideration the recommendation 
of the legal division.



Sec. 3.5  Limitations on authority to approve claims.

    (a) All proposed awards, compromises or settlements in excess of 
$25,000 require the prior written approval of the Attorney General.
    (b) All claims which fall within the provisions of 28 CFR 14.6(b) 
require referral to and consultation with the Department of Justice.
    (c) Any claim which falls within paragraph (a) or (b) of this 
section shall be reviewed by the General Counsel. If the claim, award, 
compromise, or settlement receives the approval of the General Counsel 
and the head of the bureau or office or his designee, a letter shall be 
prepared for the signature of the General Counsel transmitting to the 
Assistant Attorney General, Civil Division, Department of Justice, the 
case for approval or consultation as required by 28 CFR 14.6. Such 
letter shall conform with the requirements set forth in 28 CFR 14.7.



Sec. 3.6  Final denial of a claim.

    The final denial of an administrative claim shall conform with the 
requirements of 28 CFR 14.9 and shall be signed by the head of the 
bureau or office, or his designee.



Sec. 3.7  Action on approved claims.

    (a) Any award, compromise, or settlement in an amount of $2,500 or 
less shall be processed for payment from the appropriations of the 
bureau or office out of whose activity the claim arose.
    (b) Payment of an award, compromise, or settlement in excess of 
$2,500 and not more than $100,000 shall be obtained by the bureau or 
office by forwarding Standard Form 1145 to the Claims Division, General 
Accounting Office.
    (c) Payment of an award, compromise, or settlement in excess of 
$100,000 shall be obtained by the bureau by forwarding Standard Form 
1145 to the Bureau of Government Financial Operations, Department of the 
Treasury, which will be responsible for transmitting the award, 
compromise, or settlement to the Bureau of the Budget for inclusion in a 
deficiency appropriation bill.
    (d) When an award is in excess of $25,000, Standard Form 1145 must 
be accompanied by evidence that the award, compromise, or settlement has 
been approved by the Attorney General or his designee.
    (e) When the use of Standard Form 1145 is required, it shall be 
executed by the claimant. When a claimant is represented by an attorney, 
the voucher for payment shall designate both the claimant and his 
attorney as payees; the check shall be delivered to the attorney, whose 
address shall appear on the voucher.
    (f) Acceptance by the claimant, his agent, or legal representative, 
of any award, compromise or settlement made pursuant to the provisions 
of section 2672 or 2677 of title 28, United States Code, shall be final 
and conclusive on the claimant, his agent or legal representative and 
any other person on whose behalf or for whose benefit the claim has been 
presented, and shall constitute a complete release of any claim against 
the United States and against any employee of the Government whose act 
or omission gave rise

[[Page 113]]

to the claim, by reason of the same subject matter.

[35 FR 6429, Apr. 22, 1970, as amended at 39 FR 19470, June 3, 1974]



Sec. 3.8  Statute of limitations.

    Claims under this subpart must be presented in writing to the 
Department within 2 years after the claim accrued.



               Subpart B_Claims Under the Small Claims Act



Sec. 3.20  General.

    The Act of December 28, 1922, 42 Stat. 1066, the Small Claims Act, 
authorized the head of each department and establishment to consider, 
ascertain, adjust, and determine claims of $1,000 or less for damage to, 
or loss of, privately owned property caused by the negligence of any 
officer or employee of the Government acting within the scope of his 
employment. The Federal Tort Claims Act superseded the Small Claims Act 
with respect to claims that are allowable under the former act. 
Therefore, claims that are not allowable under the Federal Tort Claims 
Act, for example, claims arising abroad, may be allowable under the 
Small Claims Act.



Sec. 3.21  Action by claimant.

    Procedures and requirements for filing claims under this section 
shall be the same as required for filing claims under the Federal Tort 
Claims Act as set forth in Subpart A of this part.



Sec. 3.22  Legal review.

    Claims filed under this subpart shall be forwarded to the legal 
division of the bureau or office out of whose activities the claim 
arose. The claim, together with the reports of the employee and the 
investigation, shall be reviewed in the legal division which shall 
thereupon make a recommendation that the claim be approved, disapproved 
or compromised.



Sec. 3.23  Approval of claims.

    Claims shall be approved, disapproved, or compromised by the head of 
the bureau or office or his designee, taking into consideration the 
recommendation of the legal division.



Sec. 3.24  Statute of limitations.

    No claim will be considered under this subpart unless filed within 1 
year from the date of the accrual of said claim.



      Subpart C_Indemnification of Department of Treasury Employees

    Source: 56 FR 42938, Aug. 30, 1991, unless otherwise noted.



Sec. 3.30  Policy.

    (a) The Department of the Treasury may indemnify, in whole or in 
part, a Department employee (which for purposes of this regulation shall 
include a former employee) for any verdict, judgment or other monetary 
award rendered against such employee, provided the Secretary or his or 
her designee determines that (1) the conduct giving rise to such 
verdict, judgment or award was within the scope of his or her employment 
and (2) such indemnification is in the interest of the Department of the 
Treasury.
    (b) The Department of the Treasury may pay for the settlement or 
compromise of a claim against a Department employee at any time, 
provided the Secretary or his or her designee determines that (1) the 
alleged conduct giving rise to the claim was within the scope of the 
employee's employment and (2) such settlement or compromise is in the 
interest of the Department of the Treasury.
    (c) Absent exceptional circumstances, as determined by the Secretary 
or his or her designee, the Department will not entertain a request to 
indemnify or to pay for settlement of a claim before entry of an adverse 
judgment, verdict or other determination.
    (d) When a Department employee becomes aware that he or she has been 
named as a party in a proceeding in his or her individual capacity as a 
result of conduct within the scope of his or her employment, the 
employee should immediately notify his or her supervisor that such an 
action is pending. The supervisor shall promptly thereafter notify the 
chief legal officer of the employee's employing component. The

[[Page 114]]

employee shall immediately apprise the chief legal officer of his or her 
employing component of any offer to settle the proceeding.
    (e) A Department employee may request indemnification to satisfy a 
verdict, judgment or monetary award entered against the employee or to 
compromise a claim pending against the employee. The employee shall 
submit a written request, with appropriate documentation including a 
copy of the verdict, judgment, award or other order or settlement 
proposal, in a timely manner to the Secretary or his or her designee for 
decision.
    (f) Any payment under this section either to indemnify a Department 
employee or to settle a claim shall be contingent upon the availability 
of appropriated funds for the payment of salaries and expenses of the 
employing component.



PART 4_EMPLOYEES' PERSONAL PROPERTY CLAIMS--Table of Contents




    Authority: 31 U.S.C. 3721(j).

    Source: 62 FR 18518, Apr. 16, 1997, unless otherwise noted.



Sec. 4.1  Procedures.

    The procedures for filing a claim with the Treasury Department for 
personal property that is lost or damaged incident to service are 
contained in Treasury Directive 32-13, ``Claims for Loss or Damage to 
Personal Property,'' and Treasury Department Publication 32-13, 
``Policies and Procedures For Employees' Claim for Loss or Damage to 
Personal Property Incident to Service.''



PART 5_TREASURY DEBT COLLECTION--Table of Contents




                      Subpart A_General Provisions

Sec.
5.1 What definitions apply to the regulations in this part?
5.2 Why is the Treasury Department issuing these regulations and what do 
          they cover?
5.3 Do these regulations adopt the Federal Claims Collection Standards 
          (FCCS)?

             Subpart B_Procedures To Collect Treasury Debts

5.4 What notice will Treasury entities send to a debtor when collecting 
          a Treasury debt?
5.5 How will Treasury entities add interest, penalty charges, and 
          administrative costs to a Treasury debt?
5.6 When will Treasury entities allow a debtor to pay a Treasury debt in 
          installments instead of one lump sum?
5.7 When will Treasury entities compromise a Treasury debt?
5.8 When will Treasury entities suspend or terminate debt collection on 
          a Treasury debt?
5.9 When will Treasury entities transfer a Treasury debt to the Treasury 
          Department's Financial Management Service for collection?
5.10 How will Treasury entities use administrative offset (offset of 
          non-tax Federal payments) to collect a Treasury debt?
5.11 How will Treasury entities use tax refund offset to collect a 
          Treasury debt?
5.12 How will Treasury entities offset a Federal employee's salary to 
          collect a Treasury debt?
5.13 How will Treasury entities use administrative wage garnishment to 
          collect a Treasury debt from a debtor's wages?
5.14 How will Treasury entities report Treasury debts to credit bureaus?
5.15 How will Treasury entities refer Treasury debts to private 
          collection agencies?
5.16 When will Treasury entities refer Treasury debts to the Department 
          of Justice?
5.17 Will a debtor who owes a Treasury debt be ineligible for Federal 
          loan assistance or Federal licenses, permits or privileges?
5.18 How does a debtor request a special review based on a change in 
          circumstances such as catastrophic illness, divorce, death, or 
          disability?
5.19 Will Treasury entities issue a refund if money is erroneously 
          collected on a debt?

   Subpart C_Procedures for Offset of Treasury Department Payments To 
              Collect Debts Owed to Other Federal Agencies

5.20 How do other Federal agencies use the offset process to collect 
          debts from payments issued by a Treasury entity?
5.21 What does a Treasury entity do upon receipt of a request to offset 
          the salary of a Treasury entity employee to collect a debt 
          owed by the employee to another Federal agency?

Appendix A to Part 5--Treasury Directive 34-01--Waiving Claims Against 
          Treasury Employees for Erroneous Payments


[[Page 115]]


    Authority: 5 U.S.C. 5514; 26 U.S.C. 6402; 31 U.S.C. 321, 3701, 3711, 
3716, 3717, 3718, 3720A, 3720B, 3720D.

    Source: 67 FR 65845, Oct. 28, 2002, unless otherwise noted.



                      Subpart A_General Provisions



Sec. 5.1  What definitions apply to the regulations in this part?

    As used in this part:
    Administrative offset or offset means withholding funds payable by 
the United States (including funds payable by the United States on 
behalf of a State Government) to, or held by the United States for, a 
person to satisfy a debt owed by the person. The term ``administrative 
offset'' includes, but is not limited to, the offset of Federal salary, 
vendor, retirement, and Social Security benefit payments. The terms 
``centralized administrative offset'' and ``centralized offset'' refer 
to the process by which the Treasury Department's Financial Management 
Service offsets Federal payments through the Treasury Offset Program.
    Administrative wage garnishment means the process by which a Federal 
agency orders a non-Federal employer to withhold amounts from a debtor's 
wages to satisfy a debt, as authorized by 31 U.S.C. 3720D, 31 CFR 
285.11, and this part.
    Agency or Federal agency means a department, agency, court, court 
administrative office, or instrumentality in the executive, judicial, or 
legislative branch of the Federal Government, including government 
corporations.
    Creditor agency means any Federal agency that is owed a debt.
    Debt means any amount of money, funds or property that has been 
determined by an appropriate official of the Federal Government to be 
owed to the United States by a person. As used in this part, the term 
``debt'' does not include debts arising under the Internal Revenue Code 
of 1986 (26 U.S.C. 1 et seq.).
    Debtor means a person who owes a debt to the United States.
    Delinquent debt means a debt that has not been paid by the date 
specified in the agency's initial written demand for payment or 
applicable agreement or instrument (including a post-delinquency payment 
agreement) unless other satisfactory payment arrangements have been 
made.
    Delinquent Treasury debt means a delinquent debt owed to a Treasury 
entity.
    Disposable pay has the same meaning as that term is defined in 5 CFR 
550.1103.
    Employee or Federal employee means a current employee of the 
Treasury Department or other Federal agency, including a current member 
of the Armed Forces, Reserve of the Armed Forces of the United States, 
or the National Guard.
    FCCS means the Federal Claims Collection Standards, which were 
jointly published by the Departments of the Treasury and Justice and 
codified at 31 CFR parts 900--904.
    Financial Management Service means the Financial Management Service, 
a bureau of the Treasury Department, which is responsible for the 
centralized collection of delinquent debts through the offset of Federal 
payments and other means.
    Payment agency or Federal payment agency means any Federal agency 
that transmits payment requests in the form of certified payment 
vouchers, or other similar forms, to a disbursing official for 
disbursement. The ``payment agency'' may be the agency that employs the 
debtor. In some cases, the Treasury Department may be both the creditor 
agency and payment agency.
    Person means an individual, corporation, partnership, association, 
organization, State or local government, or any other type of entity 
other than a Federal agency.
    Salary offset means a type of administrative offset to collect a 
debt owed by a Federal employee from the current pay account of the 
employee.
    Secretary means the Secretary of the Treasury.
    Tax refund offset is defined in 31 CFR 285.2(a).
    Treasury debt means a debt owed to a Treasury entity by a person.
    Treasury Department means the United States Department of the 
Treasury.
    Treasury entity means the Office of Inspector General, the Office of 
Inspector General for Tax Administration, or

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a bureau of the Treasury Department, including the Departmental Offices, 
responsible for the collection of the applicable Treasury debt. 
Departmental Offices include, but are not limited to, the Office of D.C. 
Pensions, the Community Development Financial Institution Fund, the 
Executive Office of Asset Forfeiture, and the Office of Foreign Assets 
Control. Other bureaus include, but are not limited to, the Bureau of 
Public Debt; Bureau of Engraving and Printing; U.S. Mint; U.S. Secret 
Service; Customs Service; Financial Management Service; Internal Revenue 
Service; Bureau of Alcohol, Tobacco, and Firearms; Office of Comptroller 
of the Currency; the Office of Thrift Supervision; Federal Law 
Enforcement Training Center; and the Financial Crimes Enforcement 
Network.



Sec. 5.2  Why is the Treasury Department issuing these regulations and 
what do they cover?

    (a) Scope. This part provides procedures for the collection of 
Treasury debts. This part also provides procedures for collection of 
other debts owed to the United States when a request for offset of a 
Treasury payment is received by the Treasury Department from another 
agency (for example, when a Treasury Department employee owes a debt to 
the United States Department of Education).
    (b) Applicability. (1) This part applies to the Treasury Department 
when collecting a Treasury debt, to persons who owe Treasury debts, and 
to Federal agencies requesting offset of a payment issued by the 
Treasury Department as a payment agency (including salary payments to 
Treasury Department employees).
    (2) This part does not apply to tax debts nor to any debt for which 
there is an indication of fraud or misrepresentation, as described in 
Sec. 900.3 of the FCCS, unless the debt is returned by the Department 
of Justice to the Treasury Department for handling.
    (3) This part does not apply to the Financial Management Service 
when acting on behalf of other Federal agencies and states to collect 
delinquent debt referred to the Financial Management Service for 
collection action as required or authorized by Federal law. See 31 CFR 
part 285.
    (4) Nothing in this part precludes collection or disposition of any 
debt under statutes and regulations other than those described in this 
part. See, for example, 5 U.S.C. 5705, Advancements and Deductions, 
which authorizes Treasury entities to recover travel advances by offset 
of up to 100% of a Federal employee's accrued pay. See, also, 5 U.S.C. 
4108, governing the collection of training expenses. To the extent that 
the provisions of laws, other regulations, and Treasury Department 
enforcement policies differ from the provisions of this part, those 
provisions of law, other regulations, and Treasury Department 
enforcement policies apply to the remission or mitigation of fines, 
penalties, and forfeitures, and debts arising under the tariff laws of 
the United States, rather than the provisions of this part.
    (c) Additional policies and procedures. Treasury entities may, but 
are not required to, promulgate additional policies and procedures 
consistent with this part, the FCCS, and other applicable Federal law, 
policies, and procedures.
    (d) Duplication not required. Nothing in this part requires a 
Treasury entity to duplicate notices or administrative proceedings 
required by contract, this part, or other laws or regulations.
    (e) Use of multiple collection remedies allowed. Treasury entities 
and other Federal agencies may simultaneously use multiple collection 
remedies to collect a debt, except as prohibited by law. This part is 
intended to promote aggressive debt collection, using for each debt all 
available collection remedies. These remedies are not listed in any 
prescribed order to provide Treasury entities with flexibility in 
determining which remedies will be most efficient in collecting the 
particular debt.



Sec. 5.3  Do these regulations adopt the Federal Claims Collection 
Standards (FCCS)?

    This part adopts and incorporates all provisions of the FCCS. This 
part also supplements the FCCS by prescribing procedures consistent with 
the FCCS,

[[Page 117]]

as necessary and appropriate for Treasury Department operations.



             Subpart B_Procedures To Collect Treasury Debts



Sec. 5.4  What notice will Treasury entities send to a debtor when 
collecting a Treasury debt?

    (a) Notice requirements. Treasury entities shall aggressively 
collect Treasury debts. Treasury entities shall promptly send at least 
one written notice to a debtor informing the debtor of the consequences 
of failing to pay or otherwise resolve a Treasury debt. The notice(s) 
shall be sent to the debtor at the most current address of the debtor in 
the records of the Treasury entity collecting the debt. Generally, 
before starting the collection actions described in Sec. Sec. 5.5 and 
5.9 through 5.17 of this part, Treasury entities will send no more than 
two written notices to the debtor. The purpose of the notice(s) is to 
explain why the debt is owed, the amount of the debt, how a debtor may 
pay the debt or make alternate repayment arrangements, how a debtor may 
review documents related to the debt, how a debtor may dispute the debt, 
the collection remedies available to Treasury entities if the debtor 
refuses to pay the debt, and other consequences to the debtor if the 
debt is not paid. Except as otherwise provided in paragraph (b) of this 
section, the written notice(s) shall explain to the debtor:
    (1) The nature and amount of the debt, and the facts giving rise to 
the debt;
    (2) How interest, penalties, and administrative costs are added to 
the debt, the date by which payment should be made to avoid such 
charges, and that such assessments must be made unless excused in 
accordance with 31 CFR 901.9 (see Sec. 5.5 of this part);
    (3) The date by which payment should be made to avoid the enforced 
collection actions described in paragraph (a)(6) of this section;
    (4) The Treasury entity's willingness to discuss alternative payment 
arrangements and how the debtor may enter into a written agreement to 
repay the debt under terms acceptable to the Treasury entity (see Sec. 
5.6 of this part);
    (5) The name, address, and telephone number of a contact person or 
office within the Treasury entity;
    (6) The Treasury entity's intention to enforce collection if the 
debtor fails to pay or otherwise resolve the debt, by taking one or more 
of the following actions:
    (i) Offset. Offset the debtor's Federal payments, including income 
tax refunds, salary, certain benefit payments (such as Social Security), 
retirement, vendor, travel reimbursements and advances, and other 
Federal payments (see Sec. Sec. 5.10 through 5.12 of this part);
    (ii) Private collection agency. Refer the debt to a private 
collection agency (see Sec. 5.15 of this part);
    (iii) Credit bureau reporting. Report the debt to a credit bureau 
(see Sec. 5.14 of this part);
    (iv) Administrative wage garnishment. Garnish the debtor's wages 
through administrative wage garnishment (see Sec. 5.13 of this part);
    (v) Litigation. Refer the debt to the Department of Justice to 
initiate litigation to collect the debt (see Sec. 5.16 of this part);
    (vi) Treasury Department's Financial Management Service. Refer the 
debt to the Financial Management Service for collection (see Sec. 5.9 
of this part);
    (7) That Treasury debts over 180 days delinquent must be referred to 
the Financial Management Service for the collection actions described in 
paragraph (a)(6) of this section (see Sec. 5.9 of this part);
    (8) How the debtor may inspect and copy records related to the debt;
    (9) How the debtor may request a review of the Treasury entity's 
determination that the debtor owes a debt and present evidence that the 
debt is not delinquent or legally enforceable (see Sec. Sec. 5.10(c) 
and 5.11(c) of this part);
    (10) How a debtor may request a hearing if the Treasury entity 
intends to garnish the debtor's private sector (i.e., non-Federal) wages 
(see Sec. 5.13(a) of this part), including:
    (i) The method and time period for requesting a hearing;
    (ii) That the timely filing of a request for a hearing on or before 
the 15th business day following the date of

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the notice will stay the commencement of administrative wage 
garnishment, but not necessarily other collection procedures; and
    (iii) The name and address of the office to which the request for a 
hearing should be sent.
    (11) How a debtor who is a Federal employee subject to Federal 
salary offset may request a hearing (see Sec. 5.12(e) of this part), 
including:
    (i) The method and time period for requesting a hearing;
    (ii) That the timely filing of a request for a hearing on or before 
the 15th calendar day following receipt of the notice will stay the 
commencement of salary offset, but not necessarily other collection 
procedures;
    (iii) The name and address of the office to which the request for a 
hearing should be sent;
    (iv) That the Treasury entity will refer the debt to the debtor's 
employing agency or to the Financial Management Service to implement 
salary offset, unless the employee files a timely request for a hearing;
    (v) That a final decision on the hearing, if requested, will be 
issued at the earliest practical date, but not later than 60 days after 
the filing of the request for a hearing, unless the employee requests 
and the hearing official grants a delay in the proceedings;
    (vi) That any knowingly false or frivolous statements, 
representations, or evidence may subject the Federal employee to 
penalties under the False Claims Act (31 U.S.C. 3729-3731) or other 
applicable statutory authority, and criminal penalties under 18 U.S.C. 
286, 287, 1001, and 1002, or other applicable statutory authority;
    (vii) That unless prohibited by contract or statute, amounts paid on 
or deducted for the debt which are later waived or found not owed to the 
United States will be promptly refunded to the employee; and (viii) That 
proceedings with respect to such debt are governed by 5 U.S.C. 5514 and 
31 U.S.C. 3716;
    (12) How the debtor may request a waiver of the debt, if applicable 
(see, for example, Treasury Directive 34-01 (Waiving Claims Against 
Treasury Employees for Erroneous Payments), set forth at Appendix A of 
this part and at http://www.treas.gov/regs);
    (13) How the debtor's spouse may claim his or her share of a joint 
income tax refund by filing Form 8379 with the Internal Revenue Service 
(see http://www.irs.gov)
    (14) How the debtor may exercise other statutory or regulatory 
rights and remedies available to the debtor;
    (15) That certain debtors may be ineligible for Federal Government 
loans, guaranties and insurance (see 31 U.S.C. 3720B, 31 CFR 285.13, and 
Sec. 5.17(a) of this part);
    (16) If applicable, the Treasury entity's intention to suspend or 
revoke licenses, permits or privileges (see Sec. 5.17(b) of this part); 
and
    (17) That the debtor should advise the Treasury entity of a 
bankruptcy proceeding of the debtor or another person liable for the 
debt being collected.
    (b) Exceptions to notice requirements. A Treasury entity may omit 
from a notice to a debtor one or more of the provisions contained in 
paragraphs (a)(6) through (a)(17) of this section if the Treasury 
entity, in consultation with its legal counsel, determines that any 
provision is not legally required given the collection remedies to be 
applied to a particular debt.
    (c) Respond to debtors; comply with FCCS. Treasury entities should 
respond promptly to communications from debtors and comply with other 
FCCS provisions applicable to the administrative collection of debts. 
See 31 CFR part 901.



Sec. 5.5  How will Treasury entities add interest, penalty charges, 
and administrative costs to a Treasury debt?

    (a) Assessment and notice. Treasury entities shall assess interest, 
penalties and administrative costs on Treasury debts in accordance with 
the provisions of 31 U.S.C. 3717 and 31 CFR 901.9, on Treasury debts. 
Interest shall be charged in accordance with the requirements of 31 
U.S.C. 3717(a). Penalties shall accrue at the rate of 6% per year, or 
such other higher rate as authorized by law. Administrative costs,

[[Page 119]]

that is the costs of processing and handling a delinquent debt, shall be 
determined by the Treasury entity collecting the Treasury debt. Treasury 
entities may have additional policies regarding how interest, penalties, 
and administrative costs are assessed on particular types of debts. 
Treasury entities are required to explain in the notice to the debtor 
described in Sec. 5.4 of this part how interest, penalties, costs, and 
other charges are assessed, unless the requirements are included in a 
contract or repayment agreement.
    (b) Waiver of interest, penalties, and administrative costs. Unless 
otherwise required by law, Treasury entities may not charge interest if 
the amount due on the debt is paid within 30 days after the date from 
which the interest accrues. See 31 U.S.C. 3717(d). Treasury entities may 
waive interest, penalties, and administrative costs, or any portion 
thereof, when it would be against equity and good conscience or not in 
the Treasury entity's best interest to collect such charges, in 
accordance with Treasury guidelines for waiving claims against Treasury 
employees for erroneous overpayments. See Treasury Directive 34-01 
(Waiving Claims Against Treasury Employees for Erroneous Payments) set 
forth at Appendix A of this part and at http://www.treas.gov/regs. Legal 
counsel approval is not required to waive such charges. Cf., Sec. Sec. 
5.7 and 5.8 of this part, which require legal counsel approval when 
compromising a debt or terminating debt collection activity on a debt.
    (c) Accrual during suspension of debt collection. In most cases, 
interest, penalties and administrative costs will continue to accrue 
during any period when collection has been suspended for any reason (for 
example, when the debtor has requested a hearing). Treasury entities may 
suspend accrual of any or all of these charges when accrual would be 
against equity and good conscience or not in the Treasury entity's best 
interest, in accordance with Treasury guidelines for waiving claims 
against Treasury employees for erroneous overpayments. See Treasury 
Directive 34-01 (Waiving Claims Against Treasury Employees for Erroneous 
Payments), set forth at Appendix A of this part and http://
www.treas.gov/regs.



Sec. 5.6  When will Treasury entities allow a debtor to pay a Treasury 
debt in installments instead of one lump sum?

    If a debtor is financially unable to pay the debt in one lump sum, a 
Treasury entity may accept payment of a Treasury debt in regular 
installments, in accordance with the provisions of 31 CFR 901.8 and the 
Treasury entity's policies and procedures.



Sec. 5.7  When will Treasury entities compromise a Treasury debt?

    If a Treasury entity cannot collect the full amount of a Treasury 
debt, the Treasury entity may compromise the debt in accordance with the 
provisions of 31 CFR part 902 and the Treasury entity's policies and 
procedures. Legal counsel approval to compromise a Treasury debt is 
required as described in Treasury Directive 34-02 (Credit Management and 
Debt Collection), which may be found at http://www.treas.gov/regs.



Sec. 5.8  When will Treasury entities suspend or terminate debt 
collection on a Treasury debt?

    If, after pursuing all appropriate means of collection, a Treasury 
entity determines that a Treasury debt is uncollectible, the Treasury 
entity may suspend or terminate debt collection activity in accordance 
with the provisions of 31 CFR part 903 and the Treasury entity's 
policies and procedures. Legal counsel approval to terminate debt 
collection activity is required as described in Treasury Directive 34-02 
(Credit Management and Debt Collection), which may be found at http://
www.treas.gov/regs.



Sec. 5.9  When will Treasury entities transfer a Treasury debt to the 
Treasury Department's Financial Management Service for collection?

    (a) Treasury entities will transfer any eligible debt that is more 
than 180 days delinquent to the Financial Management Service for debt 
collection services, a process known as ``cross-servicing.'' See 31 
U.S.C. 3711(g) and 31 CFR 285.12. Treasury entities may transfer debts 
delinquent 180 days or

[[Page 120]]

less to the Financial Management Service in accordance with the 
procedures described in 31 CFR 285.12. The Financial Management Service 
takes appropriate action to collect or compromise the transferred debt, 
or to suspend or terminate collection action thereon, in accordance with 
the statutory and regulatory requirements and authorities applicable to 
the debt and the collection action to be taken. See 31 CFR 285.12(b)(2). 
Appropriate action includes, but is not limited to, contact with the 
debtor, referral of the debt to the Treasury Offset Program, private 
collection agencies or the Department of Justice, reporting of the debt 
to credit bureaus, and administrative wage garnishment.
    (b) At least sixty (60) days prior to transferring a Treasury debt 
to the Financial Management Service, Treasury entities will send notice 
to the debtor as required by Sec. 5.4 of this part. Treasury entities 
will certify to the Financial Management Service, in writing, that the 
debt is valid, delinquent, legally enforceable, and that there are no 
legal bars to collection. In addition, Treasury entities will certify 
their compliance with all applicable due process and other requirements 
as described in this part and other Federal laws. See 31 CFR 285.12(i) 
regarding the certification requirement.
    (c) As part of its debt collection process, the Financial Management 
Service uses the Treasury Offset Program to collect Treasury debts by 
administrative and tax refund offset. See 31 CFR 285.12(g). The Treasury 
Offset Program is a centralized offset program administered by the 
Financial Management Service to collect delinquent debts owed to Federal 
agencies and states (including past-due child support). Under the 
Treasury Offset Program, before a Federal payment is disbursed, the 
Financial Management Service compares the name and taxpayer 
identification number (TIN) of the payee with the names and TINs of 
debtors that have been submitted by Federal agencies and states to the 
Treasury Offset Program database. If there is a match, the Financial 
Management Service (or, in some cases, another Federal disbursing 
agency) offsets all or a portion of the Federal payment, disburses any 
remaining payment to the payee, and pays the offset amount to the 
creditor agency. Federal payments eligible for offset include, but are 
not limited to, income tax refunds, salary, travel advances and 
reimbursements, retirement and vendor payments, and Social Security and 
other benefit payments.



Sec. 5.10  How will Treasury entities use administrative offset (offset 
of non-tax Federal payments) to collect a Treasury debt?

    (a) Centralized administrative offset through the Treasury Offset 
Program. (1) In most cases, the Financial Management Service uses the 
Treasury Offset Program to collect Treasury debts by the offset of 
Federal payments. See Sec. 5.9(c) of this part. If not already 
transferred to the Financial Management Service under Sec. 5.9 of this 
part, Treasury entities will refer any eligible debt over 180 days 
delinquent to the Treasury Offset Program for collection by centralized 
administrative offset. See 31 U.S.C. 3716(c)(6); 31 CFR part 285, 
subpart A; and 31 CFR 901.3(b). Treasury entities may refer any eligible 
debt less than 180 days delinquent to the Treasury Offset Program for 
offset.
    (2) At least sixty (60) days prior to referring a debt to the 
Treasury Offset Program, in accordance with paragraph (a)(1) of this 
section, Treasury entities will send notice to the debtor in accordance 
with the requirements of Sec. 5.4 of this part. Treasury entities will 
certify to the Financial Management Service, in writing, that the debt 
is valid, delinquent, legally enforceable, and that there are no legal 
bars to collection by offset. In addition, Treasury entities will 
certify their compliance with the requirements described in this part.
    (b) Non-centralized administrative offset for Treasury debts. (1) 
When centralized administrative offset through the Treasury Offset 
Program is not available or appropriate, Treasury entities may collect 
past-due, legally enforceable Treasury debts through non-centralized 
administrative offset. See 31 CFR 901.3(c). In these cases, Treasury 
entities may offset a payment internally or make an offset request 
directly to a Federal payment agency. If

[[Page 121]]

the Federal payment agency is another Treasury entity, the Treasury 
entity making the request shall do so through the Deputy Chief Financial 
Officer as described in Sec. 5.20(c) of this part.
    (2) At least thirty (30) days prior to offsetting a payment 
internally or requesting a Federal payment agency to offset a payment, 
Treasury entities will send notice to the debtor in accordance with the 
requirements of Sec. 5.4 of this part. When referring a debt for offset 
under this paragraph (b), Treasury entities making the request will 
certify, in writing, that the debt is valid, delinquent, legally 
enforceable, and that there are no legal bars to collection by offset. 
In addition, Treasury entities will certify their compliance with these 
regulations concerning administrative offset. See 31 CFR 
901.3(c)(2)(ii).
    (c) Administrative review. The notice described in Sec. 5.4 of this 
part shall explain to the debtor how to request an administrative review 
of a Treasury entity's determination that the debtor owes a Treasury 
debt and how to present evidence that the debt is not delinquent or 
legally enforceable. In addition to challenging the existence and amount 
of the debt, the debtor may seek a review of the terms of repayment. In 
most cases, Treasury entities will provide the debtor with a ``paper 
hearing'' based upon a review of the written record, including 
documentation provided by the debtor. Treasury entities shall provide 
the debtor with a reasonable opportunity for an oral hearing when the 
debtor requests reconsideration of the debt and the Treasury entity 
determines that the question of the indebtedness cannot be resolved by 
review of the documentary evidence, for example, when the validity of 
the debt turns on an issue of credibility or veracity. Unless otherwise 
required by law, an oral hearing under this section is not required to 
be a formal evidentiary hearing, although Treasury entities should 
carefully document all significant matters discussed at the hearing. 
Treasury entities may suspend collection through administrative offset 
and/or other collection actions pending the resolution of a debtor's 
dispute. Each Treasury entity will have its own policies and procedures 
concerning the administrative review process consistent with the FCCS 
and the regulations in this section.
    (d) Procedures for expedited offset. Under the circumstances 
described in 31 CFR 901.3(b)(4)(iii), Treasury entities may effect an 
offset against a payment to be made to the debtor prior to sending a 
notice to the debtor, as described in Sec. 5.4 of this part, or 
completing the procedures described in paragraph (b)(2) and (c) of this 
section. Treasury entities shall give the debtor notice and an 
opportunity for review as soon as practicable and promptly refund any 
money ultimately found not to have been owed to the Government.



Sec. 5.11  How will Treasury entities use tax refund offset to collect 
a Treasury debt?

    (a) Tax refund offset. In most cases, the Financial Management 
Service uses the Treasury Offset Program to collect Treasury debts by 
the offset of tax refunds and other Federal payments. See Sec. 5.9(c) 
of this part. If not already transferred to the Financial Management 
Service under Sec. 5.9 of this part, Treasury entities will refer to 
the Treasury Offset Program any past-due, legally enforceable debt for 
collection by tax refund offset. See 26 U.S.C. 6402(d), 31 U.S.C. 3720A 
and 31 CFR 285.2.
    (b) Notice. At least sixty (60) days prior to referring a debt to 
the Treasury Offset Program, Treasury entities will send notice to the 
debtor in accordance with the requirements of Sec. 5.4 of this part. 
Treasury entities will certify to the Financial Management Service's 
Treasury Offset Program, in writing, that the debt is past-due and 
legally enforceable in the amount submitted and that the Treasury 
entities have made reasonable efforts to obtain payment of the debt as 
described in 31 CFR 285.2(d). In addition, Treasury entities will 
certify their compliance with all applicable due process and other 
requirements described in this part and other Federal laws. See 31 
U.S.C. 3720A(b) and 31 CFR 285.2.
    (c) Administrative review. The notice described in Sec. 5.4 of this 
part shall provide the debtor with at least 60 days

[[Page 122]]

prior to the initiation of tax refund offset to request an 
administrative review as described in Sec. 5.10(c) of this part. 
Treasury entities may suspend collection through tax refund offset and/
or other collection actions pending the resolution of the debtor's 
dispute.



Sec. 5.12  How will Treasury entities offset a Federal employee's 
salary to collect a Treasury debt?

    (a) Federal salary offset. (1) Salary offset is used to collect 
debts owed to the United States by Treasury Department and other Federal 
employees. If a Federal employee owes a Treasury debt, Treasury entities 
may offset the employee's Federal salary to collect the debt in the 
manner described in this section. For information on how a Federal 
agency other than a Treasury entity may collect debt from the salary of 
a Treasury Department employee, see Sec. Sec. 5.20 and 5.21, subpart C, 
of this part.
    (2) Nothing in this part requires a Treasury entity to collect a 
Treasury debt in accordance with the provisions of this section if 
Federal law allows otherwise. See, for example, 5 U.S.C. 5705 (travel 
advances not used for allowable travel expenses are recoverable from the 
employee or his estate by setoff against accrued pay and other means) 
and 5 U.S.C. 4108 (recovery of training expenses).
    (3) Treasury entities may use the administrative wage garnishment 
procedure described in Sec. 5.13 of this part to collect a debt from an 
individual's non-Federal wages.
    (b) Centralized salary offset through the Treasury Offset Program. 
As described in Sec. 5.9(a) of this part, Treasury entities will refer 
Treasury debts to the Financial Management Service for collection by 
administrative offset, including salary offset, through the Treasury 
Offset Program. When possible, Treasury entities should attempt salary 
offset through the Treasury Offset Program before applying the 
procedures in paragraph (c) of this section. See 5 CFR 550.1109.
    (c) Non-centralized salary offset for Treasury debts. When 
centralized salary offset through the Treasury Offset Program is not 
available or appropriate, Treasury entities may collect delinquent 
Treasury debts through non-centralized salary offset. See 5 CFR 
550.1109. In these cases, Treasury entities may offset a payment 
internally or make a request directly to a Federal payment agency to 
offset a salary payment to collect a delinquent debt owed by a Federal 
employee. If the Federal payment agency is another Treasury entity, the 
Treasury entity making the request shall do so through the Deputy Chief 
Financial Officer as described in Sec. 5.20(c) of this part. At least 
thirty (30) days prior to offsetting internally or requesting a Federal 
agency to offset a salary payment, Treasury entities will send notice to 
the debtor in accordance with the requirements of Sec. 5.4 of this 
part. When referring a debt for offset, Treasury entities will certify 
to the payment agency, in writing, that the debt is valid, delinquent 
and legally enforceable in the amount stated, and there are no legal 
bars to collection by salary offset. In addition, Treasury entities will 
certify that all due process and other prerequisites to salary offset 
have been met. See 5 U.S.C. 5514, 31 U.S.C. 3716(a), and this section 
for a description of the due process and other prerequisites for salary 
offset.
    (d) When prior notice not required. Treasury entities are not 
required to provide prior notice to an employee when the following 
adjustments are made by a Treasury entity to a Treasury employee's pay:
    (1) Any adjustment to pay arising out of any employee's election of 
coverage or a change in coverage under a Federal benefits program 
requiring periodic deductions from pay, if the amount to be recovered 
was accumulated over four pay periods or less;
    (2) A routine intra-agency adjustment of pay that is made to correct 
an overpayment of pay attributable to clerical or administrative errors 
or delays in processing pay documents, if the overpayment occurred 
within the four pay periods preceding the adjustment, and, at the time 
of such adjustment, or as soon thereafter as practical, the individual 
is provided written notice of the nature and the amount of the 
adjustment and point of contact for contesting such adjustment; or
    (3) Any adjustment to collect a debt amounting to $50 or less, if, 
at the time

[[Page 123]]

of such adjustment, or as soon thereafter as practical, the individual 
is provided written notice of the nature and the amount of the 
adjustment and a point of contact for contesting such adjustment.
    (e) Hearing procedures. (1) Request for a hearing. A Federal 
employee who has received a notice that his or her Treasury debt will be 
collected by means of salary offset may request a hearing concerning the 
existence or amount of the debt. The Federal employee also may request a 
hearing concerning the amount proposed to be deducted from the 
employee's pay each pay period. The employee must send any request for 
hearing, in writing, to the office designated in the notice described in 
Sec. 5.4. See Sec. 5.4(a)(11). The request must be received by the 
designated office on or before the 15th calendar day following the 
employee's receipt of the notice. The employee must sign the request and 
specify whether an oral or paper hearing is requested. If an oral 
hearing is requested, the employee must explain why the matter cannot be 
resolved by review of the documentary evidence alone. All travel 
expenses incurred by the Federal employee in connection with an in-
person hearing will be borne by the employee.
    (2) Failure to submit timely request for hearing. If the employee 
fails to submit a request for hearing within the time period described 
in paragraph (e)(1) of this section, the employee will have waived the 
right to a hearing, and salary offset may be initiated. However, 
Treasury entities should accept a late request for hearing if the 
employee can show that the late request was the result of circumstances 
beyond the employee's control or because of a failure to receive actual 
notice of the filing deadline.
    (3) Hearing official. Treasury entities must obtain the services of 
a hearing official who is not under the supervision or control of the 
Secretary. Treasury entities may contact the Deputy Chief Financial 
Officer as described in Sec. 5.20(c) of this part or an agent of any 
agency designated in Appendix A to 5 CFR part 581 (List of Agents 
Designated to Accept Legal Process) to request a hearing official.
    (4) Notice of hearing. After the employee requests a hearing, the 
designated hearing official shall inform the employee of the form of the 
hearing to be provided. For oral hearings, the notice shall set forth 
the date, time and location of the hearing. For paper hearings, the 
notice shall notify the employee of the date by which he or she should 
submit written arguments to the designated hearing official. The hearing 
official shall give the employee reasonable time to submit documentation 
in support of the employee's position. The hearing official shall 
schedule a new hearing date if requested by both parties. The hearing 
official shall give both parties reasonable notice of the time and place 
of a rescheduled hearing.
    (5) Oral hearing. The hearing official will conduct an oral hearing 
if he or she determines that the matter cannot be resolved by review of 
documentary evidence alone (for example, when an issue of credibility or 
veracity is involved). The hearing need not take the form of an 
evidentiary hearing, but may be conducted in a manner determined by the 
hearing official, including but not limited to:
    (i) Informal conferences with the hearing official, in which the 
employee and agency representative will be given full opportunity to 
present evidence, witnesses and argument;
    (ii) Informal meetings with an interview of the employee by the 
hearing official; or
    (iii) Formal written submissions, with an opportunity for oral 
presentation.
    (6) Paper hearing. If the hearing official determines that an oral 
hearing is not necessary, he or she will make the determination based 
upon a review of the available written record, including any 
documentation submitted by the employee in support of his or her 
position.
    (7) Failure to appear or submit documentary evidence. In the absence 
of good cause shown (for example, excused illness), if the employee 
fails to appear at an oral hearing or fails to submit documentary 
evidence as required for a paper hearing, the employee will have waived 
the right to a hearing, and salary offset may be initiated. Further,

[[Page 124]]

the employee will have been deemed to admit the existence and amount of 
the debt as described in the notice of intent to offset. If the Treasury 
entity representative fails to appear at an oral hearing, the hearing 
official shall proceed with the hearing as scheduled, and make his or 
her determination based upon the oral testimony presented and the 
documentary evidence submitted by both parties.
    (8) Burden of proof. Treasury entities will have the initial burden 
to prove the existence and amount of the debt. Thereafter, if the 
employee disputes the existence or amount of the debt, the employee must 
prove by a preponderance of the evidence that no debt exists or that the 
amount of the debt is incorrect. In addition, the employee may present 
evidence that the proposed terms of the repayment schedule are unlawful, 
would cause a financial hardship to the employee, or that collection of 
the debt may not be pursued due to operation of law.
    (9) Record. The hearing official shall maintain a summary record of 
any hearing provided by this part. Witnesses will testify under oath or 
affirmation in oral hearings.
    (10) Date of decision. The hearing official shall issue a written 
opinion stating his or her decision, based upon documentary evidence and 
information developed at the hearing, as soon as practicable after the 
hearing, but not later than 60 days after the date on which the request 
for hearing was received by the Treasury entity. If the employee 
requests a delay in the proceedings, the deadline for the decision may 
be postponed by the number of days by which the hearing was postponed. 
When a decision is not timely rendered, the Treasury entity shall waive 
penalties applied to the debt for the period beginning with the date the 
decision is due and ending on the date the decision is issued.
    (11) Content of decision. The written decision shall include:
    (i) A statement of the facts presented to support the origin, 
nature, and amount of the debt;
    (ii) The hearing official's findings, analysis, and conclusions; and
    (iii) The terms of any repayment schedules, if applicable.
    (12) Final agency action. The hearing official's decision shall be 
final.
    (f) Waiver not precluded. Nothing in this part precludes an employee 
from requesting waiver of an overpayment under 5 U.S.C. 5584 or 8346(b), 
10 U.S.C. 2774, 32 U.S.C. 716, or other statutory authority.
    (g) Salary offset process. (1) Determination of disposable pay. The 
office of the Deputy Chief Financial Officer will consult with the 
appropriate Treasury entity payroll office to determine the amount of a 
Treasury Department employee's disposable pay (as defined in Sec. 5.1 
of this part) and will implement salary offset when requested to do so 
by a Treasury entity, as described in paragraph (c) of this section, or 
another agency, as described in Sec. 5.20 of this part. If the debtor 
is not employed by the Treasury Department, the agency employing the 
debtor will determine the amount of the employee's disposable pay and 
will implement salary offset upon request.
    (2) When salary offset begins. Deductions shall begin within three 
official pay periods following receipt of the creditor agency's request 
for offset.
    (3) Amount of salary offset. The amount to be offset from each 
salary payment will be up to 15 percent of a debtor's disposable pay, as 
follows:
    (i) If the amount of the debt is equal to or less than 15 percent of 
the disposable pay, such debt generally will be collected in one lump 
sum payment;
    (ii) Installment deductions will be made over a period of no greater 
than the anticipated period of employment. An installment deduction will 
not exceed 15 percent of the disposable pay from which the deduction is 
made unless the employee has agreed in writing to the deduction of a 
greater amount or the creditor agency has determined that smaller 
deductions are appropriate based on the employee's ability to pay.
    (4) Final salary payment. After the employee has separated either 
voluntarily or involuntarily from the payment agency, the payment agency 
may make a lump sum deduction exceeding 15 percent of disposable pay 
from any final salary or other payments pursuant to 31 U.S.C. 3716 in 
order to satisfy a debt.

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    (h) Payment agency's responsibilities. (1) As required by 5 CFR 
550.1109, if the employee separates from the payment agency from which a 
Treasury entity has requested salary offset, the payment agency must 
certify the total amount of its collection and notify the Treasury 
entity and the employee of the amounts collected. If the payment agency 
is aware that the employee is entitled to payments from the Civil 
Service Retirement Fund and Disability Fund, the Federal Employee 
Retirement System, or other similar payments, it must provide written 
notification to the payment agency responsible for making such payments 
that the debtor owes a debt, the amount of the debt, and that the 
Treasury entity has complied with the provisions of this section. 
Treasury entities must submit a properly certified claim to the new 
payment agency before the collection can be made.
    (2) If the employee is already separated from employment and all 
payments due from his or her former payment agency have been made, 
Treasury entities may request that money due and payable to the employee 
from the Civil Service Retirement Fund and Disability Fund, the Federal 
Employee Retirement System, or other similar funds, be administratively 
offset to collect the debt. Generally, Treasury entities will collect 
such monies through the Treasury Offset Program as described in Sec. 
5.9(c) of this part.
    (3) When an employee transfers to another agency, Treasury entities 
should resume collection with the employee's new payment agency in order 
to continue salary offset.



Sec. 5.13  How will Treasury entities use administrative wage garnishment 
to collect a Treasury debt from a debtor's wages?

    (a) Treasury entities are authorized to collect debts from a 
debtor's wages by means of administrative wage garnishment in accordance 
with the requirements of 31 U.S.C. 3720D and 31 CFR 285.11. This part 
adopts and incorporates all of the provisions of 31 CFR 285.11 
concerning administrative wage garnishment, including the hearing 
procedures described in 31 CFR 285.11(f). Treasury entities may use 
administrative wage garnishment to collect a delinquent Treasury debt 
unless the debtor is making timely payments under an agreement to pay 
the debt in installments (see Sec. 5.6 of this part). At least thirty 
(30) days prior to initiating an administrative wage garnishment, 
Treasury entities will send notice to the debtor in accordance with the 
requirements of Sec. 5.4 of this part, including the requirements of 
Sec. 5.4(a)(10) of this part. For Treasury debts referred to the 
Financial Management Service under Sec. 5.9 of this part, Treasury 
entities may authorize the Financial Management Service to send a notice 
informing the debtor that administrative wage garnishment will be 
initiated and how the debtor may request a hearing as described in Sec. 
5.4(a)(10) of this part. If a debtor makes a timely request for a 
hearing, administrative wage garnishment will not begin until a hearing 
is held and a decision is sent to the debtor. See 31 CFR 285.11(f)(4). 
If a debtor's hearing request is not timely, Treasury entities may 
suspend collection by administrative wage garnishment in accordance with 
the provisions of 31 CFR 285.11(f)(5). All travel expenses incurred by 
the debtor in connection with an in-person hearing will be borne by the 
debtor.
    (b) This section does not apply to Federal salary offset, the 
process by which Treasury entities collect debts from the salaries of 
Federal employees (see Sec. 5.12 of this part).



Sec. 5.14  How will Treasury entities report Treasury debts to credit 
bureaus?

    Treasury entities shall report delinquent Treasury debts to credit 
bureaus in accordance with the provisions of 31 U.S.C. 3711(e), 31 CFR 
901.4, and the Office of Management and Budget Circular A-129, 
``Policies for Federal Credit Programs and Nontax Receivables.'' For 
additional information, see Financial Management Service's ``Guide to 
the Federal Credit Bureau Program,'' which may be found at http://
www.fms.treas.gov/debt. At least sixty (60) days prior to reporting a 
delinquent debt to a consumer reporting agency, Treasury entities will 
send notice to the debtor in accordance with the requirements of Sec. 
5.4 of this part.

[[Page 126]]

Treasury entities may authorize the Financial Management Service to 
report to credit bureaus those delinquent Treasury debts that have been 
transferred to the Financial Management Service under Sec. 5.9 of this 
part.



Sec. 5.15  How will Treasury entities refer Treasury debts to private 
collection agencies?

    Treasury entities will transfer delinquent Treasury debts to the 
Financial Management Service to obtain debt collection services provided 
by private collection agencies. See Sec. 5.9 of this part.



Sec. 5.16  When will Treasury entities refer Treasury debts to the 
Department of Justice?

    (a) Compromise or suspension or termination of collection activity. 
Treasury entities shall refer Treasury debts having a principal balance 
over $100,000, or such higher amount as authorized by the Attorney 
General, to the Department of Justice for approval of any compromise of 
a debt or suspension or termination of collection activity. See 
Sec. Sec. 5.7 and 5.8 of this part; 31 CFR 902.1; 31 CFR 903.1.
    (b) Litigation. Treasury entities shall promptly refer to the 
Department of Justice for litigation delinquent Treasury debts on which 
aggressive collection activity has been taken in accordance with this 
part and that should not be compromised, and on which collection 
activity should not be suspended or terminated. See 31 CFR part 904. 
Treasury entities may authorize the Financial Management Service to 
refer to the Department of Justice for litigation those delinquent 
Treasury debts that have been transferred to the Financial Management 
Service under Sec. 5.9 of this part.



Sec. 5.17  Will a debtor who owes a Treasury debt be ineligible for 
Federal loan assistance or Federal licenses, permits or privileges?

    (a) Delinquent debtors barred from obtaining Federal loans or loan 
insurance or guaranties. As required by 31 U.S.C. 3720B and 31 CFR 
901.6, Treasury entities will not extend financial assistance in the 
form of a loan, loan guarantee, or loan insurance to any person 
delinquent on a debt owed to a Federal agency. This prohibition does not 
apply to disaster loans. Treasury entities may extend credit after the 
delinquency has been resolved. See 31 CFR 285.13 for standards defining 
when a ``delinquency'' is ``resolved'' for purposes of this prohibition.
    (b) Suspension or revocation of eligibility for licenses, permits, 
or privileges. Unless prohibited by law, Treasury entities should 
suspend or revoke licenses, permits, or other privileges for any 
inexcusable or willful failure of a debtor to pay a debt. The Treasury 
entity responsible for distributing the licenses, permits, or other 
privileges will establish policies and procedures governing suspension 
and revocation for delinquent debtors. If applicable, Treasury entities 
will advise the debtor in the notice required by Sec. 5.4 of this part 
of the Treasury entities' ability to suspend or revoke licenses, permits 
or privileges. See Sec. 5.4(a)(16) of this part.



Sec. 5.18  How does a debtor request a special review based on a change 

in circumstances such as catastrophic illness, divorce, death, or 
disability?

    (a) Material change in circumstances. A debtor who owes a Treasury 
debt may, at any time, request a special review by the applicable 
Treasury entity of the amount of any offset, administrative wage 
garnishment, or voluntary payment, based on materially changed 
circumstances beyond the control of the debtor such as, but not limited 
to, catastrophic illness, divorce, death, or disability.
    (b) Inability to pay. For purposes of this section, in determining 
whether an involuntary or voluntary payment would prevent the debtor 
from meeting essential subsistence expenses (costs incurred for food, 
housing, clothing, transportation, and medical care), the debtor shall 
submit a detailed statement and supporting documents for the debtor, his 
or her spouse, and dependents, indicating:
    (1) Income from all sources;
    (2) Assets;
    (3) Liabilities;
    (4) Number of dependents;
    (5) Expenses for food, housing, clothing, and transportation;
    (6) Medical expenses; and
    (7) Exceptional expenses, if any.

[[Page 127]]

    (c) Alternative payment arrangement. If the debtor requests a 
special review under this section, the debtor shall submit an 
alternative proposed payment schedule and a statement to the Treasury 
entity collecting the debt, with supporting documents, showing why the 
current offset, garnishment or repayment schedule imposes an extreme 
financial hardship on the debtor. The Treasury entity will evaluate the 
statement and documentation and determine whether the current offset, 
garnishment, or repayment schedule imposes extreme financial hardship on 
the debtor. The Treasury entity shall notify the debtor in writing of 
such determination, including, if appropriate, a revised offset, 
garnishment, or payment schedule. If the special review results in a 
revised offset, garnishment, or repayment schedule, the Treasury entity 
will notify the appropriate agency or other persons about the new terms.



Sec. 5.19  Will Treasury entities issue a refund if money is erroneously 
collected on a debt?

    Treasury entities shall promptly refund to a debtor any amount 
collected on a Treasury debt when the debt is waived or otherwise found 
not to be owed to the United States, or as otherwise required by law. 
Refunds under this part shall not bear interest unless required by law.



   Subpart C_Procedures for Offset of Treasury Department Payments To 
              Collect Debts Owed to Other Federal Agencies



Sec. 5.20  How do other Federal agencies use the offset process to 
collect debts from payments issued by a Treasury entity?

    (a) Offset of Treasury entity payments to collect debts owed to 
other Federal agencies. (1) In most cases, Federal agencies submit 
eligible debts to the Treasury Offset Program to collect delinquent 
debts from payments issued by Treasury entities and other Federal 
agencies, a process known as ``centralized offset.'' When centralized 
offset is not available or appropriate, any Federal agency may ask a 
Treasury entity (when acting as a ``payment agency'') to collect a debt 
owed to such agency by offsetting funds payable to a debtor by the 
Treasury entity, including salary payments issued to Treasury entity 
employees. This section and Sec. 5.21 of this subpart C apply when a 
Federal agency asks a Treasury entity to offset a payment issued by the 
Treasury entity to a person who owes a debt to the United States.
    (2) This subpart C does not apply to Treasury debts. See Sec. Sec. 
5.10 through 5.12 of this part for offset procedures applicable to 
Treasury debts.
    (3) This subpart C does not apply to the collection of non-Treasury 
debts through tax refund offset. See 31 CFR 285.2 for tax refund offset 
procedures.
    (b) Administrative offset (including salary offset); certification. 
A Treasury entity will initiate a requested offset only upon receipt of 
written certification from the creditor agency that the debtor owes the 
past-due, legally enforceable debt in the amount stated, and that the 
creditor agency has fully complied with all applicable due process and 
other requirements contained in 31 U.S.C. 3716, 5 U.S.C. 5514, and the 
creditor agency's regulations, as applicable. Offsets will continue 
until the debt is paid in full or otherwise resolved to the satisfaction 
of the creditor agency.
    (c) Where a creditor agency makes requests for offset. Requests for 
offset under this section shall be sent to the U.S. Department of the 
Treasury, ATTN: Deputy Chief Financial Officer, 1500 Pennsylvania 
Avenue, NW., Attention: Metropolitan Square, Room 6228, Washington, DC 
20220. The Deputy Chief Financial Officer will forward the request to 
the appropriate Treasury entity for processing in accordance with this 
subpart C.
    (d) Incomplete certification. A Treasury entity will return an 
incomplete debt certification to the creditor agency with notice that 
the creditor agency must comply with paragraph (b) of this section 
before action will be taken to collect a debt from a payment issued by a 
Treasury entity.
    (e) Review. A Treasury entity is not authorized to review the merits 
of the creditor agency's determination with respect to the amount or 
validity of

[[Page 128]]

the debt certified by the creditor agency.
    (f) When Treasury entities will not comply with offset request. A 
Treasury entity will comply with the offset request of another agency 
unless the Treasury entity determines that the offset would not be in 
the best interests of the United States, or would otherwise be contrary 
to law.
    (g) Multiple debts. When two or more creditor agencies are seeking 
offsets from payments made to the same person, or when two or more debts 
are owed to a single creditor agency, the Treasury entity that has been 
asked to offset the payments may determine the order in which the debts 
will be collected or whether one or more debts should be collected by 
offset simultaneously.
    (h) Priority of debts owed to Treasury entity. For purposes of this 
section, debts owed to a Treasury entity generally take precedence over 
debts owed to other agencies. The Treasury entity that has been asked to 
offset the payments may determine whether to pay debts owed to other 
agencies before paying a debt owed to a Treasury entity. The Treasury 
entity that has been asked to offset the payments will determine the 
order in which the debts will be collected based on the best interests 
of the United States.



Sec. 5.21  What does a Treasury entity do upon receipt of a request to 

offset the salary of a Treasury entity employee to collect a debt owed 
by the employee 
          to another Federal agency?

    (a) Notice to the Treasury employee. When a Treasury entity receives 
proper certification of a debt owed by one of its employees, the 
Treasury entity will begin deductions from the employee's pay at the 
next officially established pay interval. The Treasury entity will send 
a written notice to the employee indicating that a certified debt claim 
has been received from the creditor agency, the amount of the debt 
claimed to be owed by the creditor agency, the date deductions from 
salary will begin, and the amount of such deductions.
    (b) Amount of deductions from Treasury employee's salary. The amount 
deducted under Sec. 5.20(b) of this part will be the lesser of the 
amount of the debt certified by the creditor agency or an amount up to 
15% of the debtor's disposable pay. Deductions shall continue until the 
Treasury entity knows that the debt is paid in full or until otherwise 
instructed by the creditor agency. Alternatively, the amount offset may 
be an amount agreed upon, in writing, by the debtor and the creditor 
agency. See Sec. 5.12(g) (salary offset process).
    (c) When the debtor is no longer employed by the Treasury entity. 
(1) Offset of final and subsequent payments. If a Treasury entity 
employee retires or resigns or if his or her employment ends before 
collection of the debt is complete, the Treasury entity will continue to 
offset, under 31 U.S.C. 3716, up to 100% of an employee's subsequent 
payments until the debt is paid or otherwise resolved. Such payments 
include a debtor's final salary payment, lump-sum leave payment, and 
other payments payable to the debtor by the Treasury entity. See 31 
U.S.C. 3716 and 5 CFR 550.1104(l) and 550.1104(m).
    (2) Notice to the creditor agency. If the employee is separated from 
the Treasury entity before the debt is paid in full, the Treasury entity 
will certify to the creditor agency the total amount of its collection. 
If the Treasury entity is aware that the employee is entitled to 
payments from the Civil Service Retirement and Disability Fund, Federal 
Employee Retirement System, or other similar payments, the Treasury 
entity will provide written notice to the agency making such payments 
that the debtor owes a debt (including the amount) and that the 
provisions of 5 CFR 550.1109 have been fully complied with. The creditor 
agency is responsible for submitting a certified claim to the agency 
responsible for making such payments before collection may begin. 
Generally, creditor agencies will collect such monies through the 
Treasury Offset Program as described in Sec. 5.9(c) of this part.
    (3) Notice to the debtor. The Treasury entity will provide to the 
debtor a copy of any notices sent to the creditor agency under paragraph 
(c)(2) of this section.
    (d) When the debtor transfers to another Federal agency. (1) Notice 
to the creditor agency. If the debtor transfers to another Federal 
agency before the

[[Page 129]]

debt is paid in full, the Treasury entity will notify the creditor 
agency and will certify the total amount of its collection on the debt. 
The Treasury entity will provide a copy of the certification to the 
creditor agency. The creditor agency is responsible for submitting a 
certified claim to the debtor's new employing agency before collection 
may begin.
    (2) Notice to the debtor. The Treasury entity will provide to the 
debtor a copy of any notices and certifications sent to the creditor 
agency under paragraph (d)(1) of this section.
    (e) Request for hearing official. A Treasury entity will provide a 
hearing official upon the creditor agency's request with respect to a 
Treasury entity employee. See 5 CFR 550.1107(a).

 Appendix A to Part 5--Treasury Directive 34-01--Waiving Claims Against 
                Treasury Employees for Erroneous Payments

                        Treasury Directive 34-01

    Date: July 12, 2000.
    Sunset Review: July 12, 2004.
    Subject: Waiving Claims Against Treasury Employees for Erroneous 
Payments.

                               1. Purpose

    This Directive establishes the Department of the Treasury's policies 
and procedures for waiving claims by the Government against an employee 
for erroneous payments of: (1) Pay and allowances (e.g., health and life 
insurance) and (2) travel, transportation, and relocation expenses and 
allowances.

                              2. Background

    a. 5 U.S.C. Sec. 5584 authorizes the waiver of claims by the United 
States in whole or in part against an employee arising out of erroneous 
payments of pay and allowances, travel, transportation, and relocation 
expenses and allowances. A waiver may be considered when collection of 
the claim would be against equity and good conscience and not in the 
best interest of the United States provided that there does not exist, 
in connection with the claim, an indication of fraud, misrepresentation, 
fault, or lack of good faith on the part of the employee or any other 
person having an interest in obtaining a waiver of the claim.
    b. The General Accounting Office Act of 1996 (Pub. L. 104-316), 
Title I, Sec. 103(d), enacted October 19, 1996, amended 5 U.S.C. Sec. 
5584 by transferring the authority to waive claims for erroneous 
payments exceeding $1,500 from the Comptroller General of the United 
States to the Office of Management and Budget (OMB). OMB subsequently 
redelegated this waiver authority to the executive agency that made the 
erroneous payment. The authority to waive claims not exceeding $1,500, 
which was vested in the head of each agency prior to the enactment of 
Pub. L. 104-316, was unaffected by the Act.
    c. 5 U.S.C. Sec. 5514 authorizes the head of each agency, upon a 
determination that an employee is indebted to the United States for 
debts to which the United States is entitled to be repaid at the time of 
the determination, to deduct up to 15%, or a greater amount if agreed to 
by the employee, from the employee's pay at officially established pay 
intervals in order to repay the debt.

                              3. Delegation

    a. The Deputy Assistant Secretary (Administration), the heads of 
bureaus, the Inspector General, and the Inspector General for Tax 
Administration are delegated the authority to waive, in whole or in 
part, a claim of the United States against an employee for an erroneous 
payment of pay and allowances, travel, transportation, and relocation 
expenses and allowances, aggregating less than $5,000 per claim, in 
accordance with the limitations and standards in 5 U.S.C. Sec. 5584.
    b. Treasury's Deputy Chief Financial Officer is delegated the 
authority to waive, in whole or in part, a claim of the United States 
against an employee for an erroneous payment of pay and allowances, 
travel, transportation, and relocation expenses and allowances, 
aggregating $5,000 or more per claim, in accordance with the limitations 
and standards in 5 U.S.C. Sec. 5584.

                               4. Appeals

    a. Requests for waiver of claims aggregating less than $5,000 per 
claim which are denied in whole or in part may be appealed to the Deputy 
Chief Financial Officer for the Department of the Treasury.
    b. Requests for waiver of claims aggregating $5,000 or more per 
claim which are denied in whole or in part may be appealed to the 
Assistant Secretary (Management)/Chief Financial Officer.

                             5. Redelegation

    The Deputy Assistant Secretary (Administration), the heads of 
bureaus, the Inspector General, and the Inspector General for Tax 
Administration may redelegate their respective authority and 
responsibility in writing no lower than the bureau deputy chief 
financial officer unless authorized by Treasury's Deputy Chief Financial 
Officer. Copies of each redelegation shall be submitted to the 
Department's Deputy Chief Financial Officer.

[[Page 130]]

                           6. Responsibilities

    a. The Deputy Assistant Secretary (Administration), the heads of 
bureaus, the Inspector General, and the Inspector General for Tax 
Administration shall:
    (1) Promptly notify an employee upon discovery of an erroneous 
payment to that employee;
    (2) Promptly act to collect the erroneous overpayment, following 
established debt collection policies and procedures;
    (3) Establish time frames for employees to request a waiver in 
writing and for the bureau to review the waiver request. These time 
frames must take into consideration the responsibilities of the United 
States to take prompt action to pursue enforced collection on overdue 
debts, which may arise from erroneous payments.
    (4) Notify employees whose requests for waiver of claims aggregating 
less than $5,000 per claim are denied in whole or in part of the basis 
for the denial and the right to appeal the denial to the Deputy Chief 
Financial Officer of the Department of the Treasury. All such appeals 
shall:
    (a) Be made in writing;
    (b) Specify the basis for the appeal;
    (c) Include a chronology of the events surrounding the erroneous 
payments;
    (d) Include a statement regarding any mitigating factors; and
    (e) Be submitted to the official who denied the waiver request no 
later than 60 days from receipt by the employee of written notice of the 
denial of the waiver; and
    (f) Attach at least the following documents: the employee's original 
request for a waiver; the bureau's denial of the request; any personnel 
actions, e.g., promotions, demotions, step increases, etc. that relate 
to the overpayment.
    (5) Forward to Treasury's Deputy Chief Financial Officer the appeal 
and supporting documentation, the bureau's recommendation as to why the 
appeal should be approved or denied; and a statement as to the action 
taken by the bureau to avoid a recurrence of the error.
    (6) Pay a refund when appropriate if a waiver is granted;
    (7) Fulfill all labor relations responsibilities when implementing 
this directive; and
    (8) Fulfill any other responsibility of the agency imposed by 5 
U.S.C. Sec. 5584, or other applicable laws and regulations.
    b. Treasury's Deputy Chief Financial Officer shall advise employees 
whose requests for waiver of claims aggregating $5,000 or more per claim 
are denied in whole or in part of the basis for the denial and the right 
to appeal the denial to the Assistant Secretary (Management)/Chief 
Financial Officer. All such appeals shall be in the format and contain 
the information and documentation described in subsection 6.a.(4), 
above. The Deputy Chief Financial Officer shall forward to Assistant 
Secretary (Management)/Chief Financial Officer the appeal and supporting 
documentation, his/her recommendation as to why the appeal should be 
approved or denied, and a statement obtained from the bureau from which 
the claim arose as to the action taken by the bureau to avoid a 
recurrence of the error.

                        7. Reporting Requirements

    a. Each bureau, the Deputy Assistant Secretary (Administration) for 
Departmental Offices, the Inspector General, and the Inspector General 
for Tax Administration shall maintain a register of waiver actions 
subject to Departmental review. The register shall cover each fiscal 
year and be prepared by December 31 of each year for the preceding 
fiscal year. The register shall contain the following information:
    (1) The total amount waived by the bureau;
    (2) The number and dollar amount of waiver applications granted in 
full;
    (3) The number and dollar amount of waiver applications granted in 
part and denied in part, and the dollar amount of each;
    (4) The number and dollar amount of waiver applications denied in 
their entirety;
    (5) The number of waiver applications referred to the Deputy Chief 
Financial Officer for initial action or for appeal;
    (6) The dollar amount refunded as a result of waiver action by the 
bureau; and
    (7) The dollar amount refunded as a result of waiver action by the 
Deputy Chief Financial Officer or the Assistant Secretary (Management)/
Chief Financial Officer.
    b. Each bureau, the Deputy Assistant Secretary (Administration) for 
Departmental Offices, the Inspector General, and the Inspector General 
for Tax Administration shall retain a written record of each waiver 
action for 6 years and 3 months. At a minimum, the written record shall 
contain:
    (1) The bureau's summary of the events surrounding the erroneous 
payment;
    (2) Any written comments submitted by the employee from whom 
collection is sought;
    (3) An account of the waiver action taken and the reasons for such 
action; and
    (4) Other pertinent information such as any action taken to refund 
amounts repaid.

                     8. Effect of Request for Waiver

    A request for a waiver of a claim shall not affect an employee's 
opportunity under 5 U.S.C. Sec. 5514(a)(2)(D) for a hearing on the 
determination of the agency concerning the existence or the amount of 
the debt, or the terms of the repayment schedule. A request by an 
employee for a hearing under 5 U.S.C. Sec. 5514(a)(2)(D) shall not 
affect an employee's right to request a waiver of the claim. The 
determination whether to waive a claim may

[[Page 131]]

be made at the discretion of the deciding official either before or 
after a final decision is rendered pursuant to 5 U.S.C. Sec. 
5514(a)(2)(D) concerning the existence or the amount of the debt, or the 
terms of the repayment schedule.

                 9. Guidelines for Determining Requests

    a. A request for a waiver shall not be granted if the deciding 
official determines there exists, in connection with the claim, an 
indication of fraud, misrepresentation, fault, or lack of good faith on 
the part of the employee or any other person having an interest in 
obtaining a waiver of the claim. There are no exceptions to this rule 
for financial hardship or otherwise.
    (1) ``Fault'' exists if, in light of all the circumstances, it is 
determined that the employee knew or should have known that an error 
existed, but failed to take action to have it corrected. Fault can 
derive from an act or a failure to act. Unlike fraud, fault does not 
require a deliberate intent to deceive. Whether an employee should have 
known about an error in pay is determined from the perspective of a 
reasonable person. Pertinent considerations in finding fault include 
whether:
    (a) The payment resulted from the employee's incorrect, but not 
fraudulent, statement that the employee should have known was incorrect;
    (b) The payment resulted from the employee's failure to disclose 
material facts in the employee's possession which the employee should 
have known to be material; or
    (c) The employee accepted a payment, which the employee knew or 
should have known to be erroneous.
    (2) Every case must be examined in light of its particular facts. 
For example, where an employee is promoted to a higher grade but the 
step level for the employee's new grade is miscalculated, it may be 
appropriate to conclude that there is no fault on the employee's part 
because employees are not typically expected to be aware of and 
understand the rules regarding determination of step level upon 
promotion. On the other hand, a different conclusion as to fault 
potentially may be reached if the employee in question is a personnel 
specialist or an attorney who concentrates on personnel law.
    b. If the deciding official finds an indication of fraud, 
misrepresentation, fault, or lack of good faith on the part of the 
employee or any other person having an interest in obtaining a waiver of 
the claim, then the request for a waiver must be denied.
    c. If the deciding official finds no indication of fraud, 
misrepresentation, fault, or lack of good faith on the part of the 
employee or any other person having an interest in obtaining a waiver of 
the claim, the employee is not automatically entitled to a waiver. 
Before a waiver can be granted, the deciding official must also 
determine that collection of the claim against an employee would be 
against equity and good conscience and not in the best interests of the 
United States. Factors to consider when determining if collection of a 
claim against an employee would be against equity and good conscience 
and not in the best interests of the United States include, but are not 
limited to:
    (1) Whether collection of the claim would cause serious financial 
hardship to the employee from whom collection is sought.
    (2) Whether, because of the erroneous payment, the employee either 
has relinquished a valuable right or changed positions for the worse, 
regardless of the employee's financial circumstances.
    (a) To establish that a valuable right has been relinquished, it 
must be shown that the right was, in fact, valuable; that it cannot be 
regained; and that the action was based chiefly or solely on reliance on 
the overpayment.
    (b) To establish that the employee's position has changed for the 
worse, it must be shown that the decision would not have been made but 
for the overpayment, and that the decision resulted in a loss.
    (c) An example of a ``detrimental reliance'' would be a decision to 
sign a lease for a more expensive apartment based chiefly or solely upon 
reliance on an erroneous calculation of salary, and the funds spent for 
rent cannot be recovered.
    (3) The cost of collecting the claim equals or exceeds the amount of 
the claim;
    (4) The time elapsed between the erroneous payment and discovery of 
the error and notification of the employee;
    (5) Whether failure to make restitution would result in unfair gain 
to the employee;
    (6) Whether recovery of the claim would be unconscionable under the 
circumstances.
    d. The burden is on the employee to demonstrate that collection of 
the claim would be against equity and good conscience and not in the 
best interest of the United States.

                             10. Authorities

    a. 5 U.S.C. Sec. 5584, ``Claims for Overpayment of Pay and 
Allowances, and of Travel, Transportation and Relocation Expenses and 
Allowances.''
    b. 31 U.S.C. Sec. 3711, ``Collection and Compromise.''
    c. 31 U.S.C. Sec. 3716, ``Administrative Offset.''
    d. 31 U.S.C. Sec. 3717, ``Interest and Penalty on Claims.''
    e. 5 CFR Part 550, subpart K, ``Collection by Offset from Indebted 
Government Employees.''
    f. 31 CFR Part 5, subpart B, ``Salary Offset.''
    g. Determination with Respect to Transfer of Functions Pursuant to 
Public Law 104-316, OMB, December 17, 1996.

[[Page 132]]

                            11. Cancellation

    TD 34-01, ``Waiver of Claims for Erroneous Payments,'' dated October 
25, 1995, is superseded.

                     12. Office of Primary Interest

    Office of Accounting and Internal Control.



PART 6_APPLICATIONS FOR AWARDS UNDER THE EQUAL ACCESS TO JUSTICE ACT
--Table of Contents




                      Subpart A_General Provisions

Sec.
6.1 Purpose of these rules.
6.2 When the Act applies.
6.3 Proceedings covered.
6.4 Eligibility of applicants.
6.5 Standards for awards.
6.6 Allowable fees and other expenses.
6.7 Delegations of authority.

             Subpart B_Information Required From Applicants

6.8 Contents of application.
6.9 Net worth exhibit.
6.10 Documentation of fees and expenses.
6.11 When an application may be filed.

            Subpart C_Procedures for Considering Applications

6.12 Filing and service of documents.
6.13 Answer to application.
6.14 Decision.
6.15 Agency review.
6.16 Judicial review.
6.17 Payment of award.

    Authority: Sec. 203(a)(1), Pub. L. 96-481, 94 Stat. 2325 (5 U.S.C. 
504(c)(1)).

    Source: 47 FR 20765, May 14, 1982, unless otherwise noted.



                      Subpart A_General Provisions



Sec. 6.1  Purpose of these rules.

    The Equal Access to Justice Act, 5 U.S.C. 504 (called ``the Act'' in 
this part), provides for the award of attorney fees and other expenses 
to eligible individuals and entities who are parties to certain 
administrative proceedings (called ``adversary adjudications'') before 
agencies of the Government of the United States. An eligible party may 
receive an award when it prevails over an agency, unless the agency's 
position in the proceeding was substantially justified or special 
circumstances make an award unjust. The rules in this part describe the 
parties eligible for awards and the proceedings that are covered. They 
also explain how to apply for awards, and the procedures and standards 
that the Treasury Department will use to make them.



Sec. 6.2  When the Act applies.

    The Act applies to any adversary adjudication pending before an 
agency at any time between October 1, 1981 and September 30, 1984. This 
includes proceedings begun before October 1, 1981, if final agency 
action has not been taken before that date, and proceedings pending on 
September 30, 1984, regardless of when they were initiated or when final 
agency action occurs.



Sec. 6.3  Proceedings covered.

    The Act applies to adversary adjudications required to be conducted 
by the Treasury Department under 5 U.S.C. 554. Within the Treasury 
Department, these proceedings are:
    (a) Bureau of Alcohol, Tobacco and Firearms: (1) Permit proceedings 
under the Federal Alcohol Administration Act (27 U.S.C. 204); (2) Permit 
proceedings under the Internal Revenue Code of 1954 (26 U.S.C. 5171, 
5271, 5713); (3) License and permit proceedings under the Federal 
Explosives Laws (18 U.S.C. 843).
    (b) Comptroller of the Currency:

All proceedings conducted under 12 CFR part 19, subpart A.



Sec. 6.4  Eligibility of applicants.

    (a) To be eligible for an award of attorney fees and other expenses 
under the Act, the applicant must be a party to the adversary 
adjudication for which it seeks an award. The term ``party'' is defined 
in 5 U.S.C. 551(3). The applicant must show that it meets all conditions 
of eligibility set out in this subpart and has complied with the 
requirements in Subpart B of this part.
    (b) The types of eligible applicants are as follows:
    (1) An individual with a net worth of not more than $1 million;
    (2) The sole owner of an unincorporated business who has a net worth 
of not more than $5 million, including both personal and business 
interests, and not more than 500 employees;

[[Page 133]]

    (3) A charitable or other tax-exempt organization described in 
section 501(c)(3) of the Internal Revenue Code (26 U.S.C. 501(c)(3)) 
with not more than 500 employees;
    (4) A cooperative association as defined in section 15(a) of the 
Agricultural Marketing Act (12 U.S.C. 1141(a)) with not more than 500 
employees, or
    (5) Any other partnership, corporation, association, or public or 
private organization with a net worth of not more than $5 million and 
not more than 500 employees.
    (c) For the purpose of eligibility, the net worth and number of 
employees of an applicant shall be determined as of the date the 
proceeding was initiated.
    (d) An applicant who owns an unincorporated business will be 
considered as an ``individual'' rather than a ``sole owner of an 
unincorporated business'' if the matter in controversy is primarily 
related to personal interests rather than to business interests.
    (e) The employees of an applicant include all persons who regularly 
perform services for remuneration for the applicant, under the 
applicant's direction and control. Part-time employees shall be 
included.
    (f) The net worth and number of employees of the applicant and all 
of its affiliates shall be aggregated to determine eligibility. Any 
individual or group of individuals, corporation or other entity that 
directly or indirectly controls or owns a majority of the voting shares 
of another business, or controls in any manner the election of a 
majority of that business's board of directors, trustees, or other 
persons exercising similar functions, will be considered an affiliate of 
that business for purposes of this part, unless the adjudicative officer 
determines that such treatment would be unjust and contrary to the 
purposes of the Act in light of the actual relationship between the 
afffiliated entities. In addition, the adjudicative officer may 
determine that financial relationships of the applicant other than those 
described in this paragraph constitute special circumstances that would 
make an award unjust.
    (g) An applicant that participates in a proceeding primarily on 
behalf of one or more other persons or entities that would be ineligible 
is not itself eligible for an award.



Sec. 6.5  Standards for awards.

    (a) A prevailing applicant may receive an award for fees and 
expenses incurred in connection with the final disposition of a 
proceeding, unless (1) the position of the agency was substantially 
justified, or (2) special circumstances make the award unjust. No 
presumption arises that the agency's position was not substantially 
justified simply because the agency did not prevail.
    (b) An award will be reduced or denied if the applicant has unduly 
or unreasonably protracted the proceeding or if special circumstances 
make the award sought unjust.



Sec. 6.6  Allowable fees and other expenses.

    (a) The following fees and other expenses are allowable under the 
Act:
    (1) Reasonable expenses of expert witnesses;
    (2) Reasonable cost of any study, analysis, engineering report, 
test, or project which the agency finds necessary for the preparation of 
the party's case;
    (3) Reasonable attorney or agent fees.
    (b) The amount of fees awarded will be based upon the prevailing 
market rates for the kind and quality of services furnished, except that
    (1) Compensation for an expert witness will not exceed the highest 
rate paid by the agency for expert witnesses; and
    (2) Attorney or agent fees will not be in excess of $75 per hour.



Sec. 6.7  Delegations of authority.

    The Director, Bureau of Alcohol, Tobacco and Firearms and the 
Comptroller of the Currency are authorized to take final action on 
matters pertaining to the Equal Access to Justice Act, 5 U.S.C. 504, in 
proceedings listed in Sec. 6.3 under the respective bureau or office. 
The Secretary of the Treasury may by order delegate authority to take 
final action on matters pertaining to the Equal Access to Justice Act in 
particular cases to other subordinate officials.

[[Page 134]]



             Subpart B_Information Required From Applicants



Sec. 6.8  Contents of application.

    (a) An application for an award of fees and expenses under the Act 
shall identify the applicant and the proceeding for which an award is 
sought. The application shall show that the applicant has prevailed and 
identify the position of the agency in the proceeding that the applicant 
alleges was not substantially justified. The application shall state the 
basis for the applicant's belief that the position was not substantially 
justified. Unless the applicant is an individual, the application shall 
also state the number of employees of the applicant and describe briefly 
the type and purpose of its organization or business.
    (b) The application shall also include a statement that the 
applicant's net worth does not exceed $1 million (if an individual) or 
$5 million (for all other applicants, including their affiliates). 
However, an applicant may omit this statement if:
    (1) It attaches a copy of a ruling by the Internal Revenue Service 
that it qualifies as an organization described in section 501(c)(3) of 
the Internal Revenue Code (26 U.S.C. 501(c)(3)) or, in the case of a 
tax-exempt organization not required to obtain a ruling from the 
Internal Revenue Service on its exempt status, a statement that 
describes the basis for the applicant's belief that it qualifies under 
such section; or
    (2) It states that it is a cooperative association as defined in 
section 15(a) of the Agricultural Marketing Act (12 U.S.C. 1141j(a)).
    (c) The application shall itemize the amount of fees and expenses 
for which an award is sought.
    (d) The application may also include any other matters that the 
applicant wishes the agency to consider in determining whether and in 
what amount an award should be made.
    (e) The application shall be signed by the applicant or an 
authorized officer with respect to the eligibility of the applicant and 
by the attorney of the applicant with respect to fees and expenses 
sought. It shall also contain or be accompanied by a written 
verification under oath or under penalty of perjury that the information 
provided in the application is true and correct.

(Approved by the Office of Management and Budget under control number 
1512-0444, for applications filed with the Bureau of Alcohol, Tobacco 
and Firearms)

(5 U.S.C. 552(a) (80 Stat. 383, as amended))

[47 FR 20765, May 14, 1982, as amended at 49 FR 14944, Apr. 16, 1984]



Sec. 6.9  Net worth exhibit.

    (a) Each applicant except a qualified tax-exempt organization, or 
cooperative association must provide with its application a detailed 
exhibit showing the net worth of the applicant and any affiliates (as 
defined in Sec. 6.4(f)) when the proceeding was initiated. In the case 
of national banking associations, ``net worth'' shall be considered to 
be the total capital and surplus as reported, in conformity with the 
applicable instructions and guidelines, on the bank's last Consolidated 
Report of Condition filed before the initiation of the underlying 
proceeding.
    (b) The exhibit may be in any form convenient to the applicant that 
provides full disclosure of the applicant's and its affiliates assets 
and liabilities and is sufficient to determine whether the applicant 
qualifies under the standards in this part. The adjudicative officer may 
require an applicant to file additional information to determine its 
eligibility for an award.



Sec. 6.10  Documentation of fees and expenses.

    (a) The application shall be accompanied by full documentation of 
the fees and expenses, including the cost of any study, engineering 
report, test, or project, for which an award is sought.
    (b) The documentation shall include an affidavit from any attorney, 
agent, or expert witness representing or appearing in behalf of the 
party, stating the actual time expended and the rate at which fees and 
other expenses were computed and describing the specific services 
performed.
    (1) The affidavit shall state the services performed. In order to 
establish the hourly rate, the affidavit shall state the hourly rate 
which is billed

[[Page 135]]

and paid by the majority of clients during the relevant time periods.
    (2) If not hourly rate is paid by the majority of clients because, 
for instance, the attorney or agent represents most clients on a 
contingency basis, the attorney or agent shall provide information about 
two attorneys or agents with similar experience, who perform similar 
work, stating their hourly rate.
    (c) The documentation shall also include a description of any 
expenses for which reimbursement is sought and a statement of the 
amounts paid and payable by the applicant or by any other person or 
entity for the services provided.
    (d) The adjudicative officer may require the applicant to provide 
vouchers, receipts, or other substantiation for any expenses claimed.



Sec. 6.11  When an application may be filed.

    (a) An application may be filed whenever the applicant has prevailed 
in the proceeding but in no case later than 30 days after the agency's 
final disposition of the proceeding.
    (b) If review or reconsideration is sought or taken of a decision as 
to which an appplicant believes it has prevailed, proceedings for the 
award of fees shall be stayed pending final disposition of the 
underlying controversy.



            Subpart C_Procedures for Considering Applications



Sec. 6.12  Filing and service of documents.

    Any application for an award or other pleading or document related 
to an application shall be filed and served on all parties to the 
proceeding in the same manner as other pleadings in the proceeding.



Sec. 6.13  Answer to application.

    (a) Within 30 days after service of an application, counsel 
representing the agency against which an award is sought shall file an 
answer to the application.
    (b) If agency counsel and the applicant believe that the issues in 
the fee application can be settled, they may jointly file a statement of 
their intent to negotiate a settlement. The filing of this statement 
shall extend the time for filing an answer for an additional 60 days and 
further extensions may be granted by the adjudicative officer upon 
request by agency counsel and the applicant.
    (c) The answer shall explain any objections to the award requested 
and identify the facts relied on in support of agency counsel's 
position. If the answer is based on any alleged facts not already in the 
record of the proceeding, agency counsel shall include with the answer 
supporting affidavits.



Sec. 6.14  Decision.

    The adjudicative officer shall issue an initial decision on the 
application within 60 days after completion of proceedings on the 
application. The decision shall include written findings and conclusions 
on the applicant's eligibility and status as a prevailing party, and an 
explanation of the reasons for any difference between the amount 
requested and the amount awarded. The decision shall also include, if at 
issue, findings on whether the agency's position was substantially 
justified, whether the applicant unduly protracted the proceedings, or 
whether special circumstances make an award unjust.



Sec. 6.15  Agency review.

    Either the applicant or agency counsel may seek review of the 
initial decision on the fee application, or the agency may decide to 
review the decision on its own initiative. If neither the applicant nor 
agency counsel seeks a review and the agncy does not take review on its 
own initiative, the initial decision on the application shall become a 
final decision of the agency 30 days after it is issued. Whether to 
review a decision is a matter within the discretion of the agency. If 
review is taken, the agency will issue a final decision on the 
application or remand the application to the adjudicative officer for 
further proceedings.



Sec. 6.16  Judicial review.

    Judicial review of final agency decisions on awards may be sought as 
provided in 5 U.S.C. 504(c)(2).

[[Page 136]]



Sec. 6.17  Payment of award.

    An applicant seeking payment of an award shall submit to the agency 
a copy of the agency's final decision granting the award, accompanied by 
a statement that the applicant will not seek review of the decision in 
the United States courts. An applicant shall be paid the amount awarded 
unless judicial review of the award or of the underlying decision of the 
adversary adjudication has been sought by the applicant or any other 
party to the proceeding.



PART 7_EMPLOYEE INVENTIONS--Table of Contents




Sec.
7.1 Purpose.
7.2 Responsibilities of the Department.
7.3 Responsibilities of heads of offices.
7.4 Responsibilities of the General Counsel.
7.5 Responsibilities of employees.
7.6 Effect of awards.
7.7 Appeals.
7.8 Delegation.

    Authority: 80 Stat. 379; 5 U.S.C. 301, sec. 6, E.O. 10096; 3 CFR, 
1949-1953 Comp., p. 292, as amended by E.O. 10930; 3 CFR, 1959-1963 
Comp., p. 456.

    Source: 33 FR 10088, July 13, 1968, unless otherwise noted.



Sec. 7.1  Purpose.

    Provisions defining the right, title, and interest of the Government 
in and to an invention made by a Government employee under various 
circumstances and the duties of Government agencies with respect thereto 
are set forth in Executive Order 10096, 15 FR 389, as amended (35 U.S.C. 
266 note). Further definition of the circumstances under which the 
Government will acquire the right to a patent in such an invention or a 
nonexclusive, irrevocable, royalty-free license in the invention, and 
the procedures for the determination of these interests, are set forth 
in the regulations issued under that Executive order by the Patent 
Office, 37 CFR part 100. The purpose of this part 7 is to implement for 
the Treasury Department the foregoing Executive order and regulations of 
the Patent Office by (a) bringing to the attention of Treasury employees 
the law and procedure governing their rights to, and interest in, 
inventions made by them, (b) defining responsibility within the 
Department for making the necessary determinations, and, (c) 
establishing internal procedures for action in conformity with the 
Executive order and the Patent Office regulations.



Sec. 7.2  Responsibilities of the Department.

    The responsibilities of the Treasury Department are to determine 
initially (a) the occurrence of an invention by an employee, (b) his 
rights in the invention and the rights of the Government therein, and 
(c) whether patent protection will be sought in the United States by the 
Department, and to furnish the required reports to the Patent Office.



Sec. 7.3  Responsibilities of heads of offices.

    (a) Heads of bureaus or offices in the Department shall be 
responsible for determining initially whether the results of research, 
development, or other activity of an employee within that bureau or 
office constitute an invention which falls within the purview of 
Executive Order 10096, as amended, and is to be handled in accordance 
with the regulations in this part.
    (b) Heads of bureaus or offices are responsible for obtaining from 
the employee the necessary information and, if the determination under 
paragraph (a) of this section is affirmative, preparing on behalf of the 
bureau or office a description of the invention and its relationship to 
the employee's duties and work assignments.
    (c) Heads of bureaus or offices, after such examination and 
investigation as may be necessary, shall refer to the General Counsel 
all information obtained concerning the invention and such determination 
as the head of the bureau or office has made with respect to the 
character of the activity as an invention. These reports shall include 
any determination as to the giving of a cash award to the employee for 
his performance relating to that invention.



Sec. 7.4  Responsibilities of the General Counsel.

    (a) The General Counsel shall be responsible for determining, 
subject to

[[Page 137]]

review by the Commissioner of Patents, the respective rights of the 
Government and of the inventor in and to any invention made by an 
employee of the Department.
    (b) On the basis of the foregoing determination, the General Counsel 
shall determine whether patent protection will be sought by the 
Department for such an invention.
    (c) The General Counsel will prepare and furnish to the Patent 
Office the reports required by the regulations of that Office and will 
serve as the liaison officer between the Department and the Commissioner 
of Patents.



Sec. 7.5  Responsibilities of employees.

    All employees are required to report to the heads of their bureaus 
or offices any result of research, development, or other activity on 
their part which may constitute an invention and the circumstances under 
which this possible invention came into being.



Sec. 7.6  Effect of awards.

    The acceptance by an employee of a cash award for performance which 
constitutes an invention shall, in accordance with 5 U.S.C. 4502(c), 
constitute an agreement that the use by the Government of the idea, 
method, or device for which the award is made does not form the basis of 
any further claim against the Government by the employee, his heirs or 
assigns.



Sec. 7.7  Appeals.

    (a) Any employee who is aggrieved by a determination made by the 
head of his bureau or office under this part may obtain a review of the 
determination by filing an appeal with the General Counsel within 30 
days after receiving the notice of the determination complained of.
    (b) Any employee who is aggrieved by a determination made by the 
General Counsel under this part may obtain a review of the determination 
by filing a written appeal with the Commissioner of Patents within 30 
days after receiving notice of the determination complained of, or 
within such longer period as the Commissioner may provide. The appeal to 
the Commissioner shall be processed in accordance with the provisions in 
the regulations of the Patent Office for an appeal from an agency 
determination.



Sec. 7.8  Delegation.

    The heads of bureaus or offices and the General Counsel may 
delegate, as appropriate, the performance of the responsibilities 
assigned to them under this part.



PART 8_PRACTICE BEFORE THE BUREAU OF ALCOHOL, TOBACCO AND FIREARMS
--Table of Contents




                     Subpart A_General Requirements

Sec.
8.1 Scope.
8.2 Persons who may practice.
8.3 Conference and practice requirements.
8.4 Director of Practice.
8.5 Records.
8.6 Special orders.

                          Subpart B_Definitions

8.11 Meaning of terms.

                     Subpart C_Enrollment Procedures

8.21 Eligibility for enrollment.
8.22 Application for enrollment.
8.23 Denial of enrollment; appeal.
8.24 Enrollment cards.
8.25 Renewal of enrollment card.
8.26 Change in enrollment.
8.27 Enrollment registers.
8.28 Termination of enrollment.
8.29 Limited practice without enrollment.

         Subpart D_Duties and Restrictions Relating to Practice

8.31 Furnishing of information.
8.32 Prompt disposition of pending matters.
8.33 Accuracy.
8.34 Knowledge of client's omission.
8.35 Assistance from disbarred or suspended persons and former Treasury 
          employees.
8.36 Practice by partners of Government employees.
8.37 Practice by former Government employees.
8.38 Notaries.
8.39 Fees.
8.40 Conflicting interests.
8.41 Solicitation.
8.42 Practice of law.

                   Subpart E_Disciplinary Proceedings

8.51 Authority to disbar or suspend.
8.52 Disreputable conduct.
8.53 Initiation of disciplinary proceedings.
8.54 Conferences.

[[Page 138]]

8.55 Contents of complaint.
8.56 Service of complaint and other papers.
8.57 Answer.
8.58 Supplemental charges.
8.59 Proof; variance; amendment of pleadings.
8.60 Motions and requests.
8.61 Representation.
8.62 Administrative Law Judge.
8.63 Hearings.
8.64 Evidence.
8.65 Depositions.
8.66 Transcript.
8.67 Proposed findings and conclusions.
8.68 Decision of Administrative Law Judge.
8.69 Appeal to the Secretary.
8.70 Decision of the Secretary.
8.71 Effect of disbarment or suspension.
8.72 Petition for reinstatement.

    Authority: Sec. 3, 23 Stat. 258 (31 U.S.C. 1026); 5 U.S.C. 301, 500, 
551-559; and Reorganization Plan No. 26 of 1950, 15 FR 4935, 64 Stat. 
1280, as amended.

    Source: 42 FR 33026, June 29, 1977, unless otherwise noted.



                     Subpart A_General Requirements



Sec. 8.1  Scope.

    This part contains rules governing the recognition of attorneys, 
certified public accountants, enrolled practitioners, and other persons 
representing clients before the Bureau of Alcohol, Tobacco and Firearms.



Sec. 8.2  Persons who may practice.

    (a) Attorneys. Any attorney who is not currently under suspension or 
disbarment from practice before the Bureau of Alcohol, Tobacco and 
Firearms, may practice before the Bureau upon filing a written 
declaration with the Bureau, that he or she is currently qualified as an 
attorney and is authorized to represent the particular party on whose 
behalf he or she acts.
    (b) Certified public accountants. Any certified public accountant 
who is not currently under suspension or disbarment before the Bureau of 
Alcohol, Tobacco and Firearms, may practice before the Bureau upon 
filing a written declaration with the Bureau, that he or she is 
currently qualified as a certified public accountant and is authorized 
to represent the particular party on whose behalf he or she acts.
    (c) Enrollment practitioners. Any person enrolled as a practitioner 
under the provisions of subpart C of this part and who is not under 
suspension or disbarment from enrollment may practice before the Bureau.
    (d) Limited practitioners. Any person qualified for limited practice 
without enrollment under the provisions of Sec. 8.29 may practice 
before the Bureau.
    (e) Restrictions on Government officers and employees. Any officer 
or employee of the United States in the executive, legislative, or 
judicial branch of the Government, or in any agency of the United 
States, including the District of Columbia, who is otherwise eligible to 
practice under the provisions of this part, may represent parties before 
the Bureau when doing so in the conduct of his or her official duties. A 
Government officer or employee may not otherwise practice before the 
Bureau except that, subject to the requirements of 18 U.S.C. 205, he or 
she may represent a member of his or her immediate family or a person or 
estate for which he or she serves as guardian, executor, administrator, 
trustee or other personal fiduciary. Member of Congress or Resident 
Commissioners (elect or serving) may not practice before the Bureau in 
connection with any matter for which they directly or indirectly seek 
any compensation.
    (f) Restrictions on State officers and employees. No officer or 
employee of any State, or subdivision thereof, whose official 
responsibilities require him or her to pass upon, investigate, or deal 
with any State law or regulation concerning alcohol, tobacco, firearms, 
explosives matters or wagering, may practice before the Bureau if his or 
her official responsibility may disclose pertinent facts or information 
relating to matters administered by the Bureau.
    (g) Customhouse brokers. Customhouse brokers, licensed by the 
Commissioner of Customs according to 19 CFR part 111, may represent a 
party for whom they have acted as a customhouse broker before the Bureau 
with respect to matters relating to the importation

[[Page 139]]

or exportation of merchandise under customs or intenal revenue laws.

(Approved by the Office of Management and Budget under control number 
1512-0418)

(18 U.S.C. 203, 205; 5 U.S.C. 552(a) (80 Stat. 383, as amended))

[42 FR 33026, June 29, 1977, as amended at 49 FR 14944, Apr. 16, 1984]



Sec. 8.3  Conference and practice requirements.

    Conference and practice requrements of the Bureau of Alcohol, 
Tobacco and Firearms, including requirements for powers of attorney are 
set forth in:
    (a) 26 CFR part 601, subpart E (or those regulations as recodified 
in 27 CFR part 71 subsequent to the effective date of these regulations, 
31 CFR part 8) with respect to all representations before the Bureau 
except those concerning license or permit proceedings;
    (b) 27 CFR part 200 with respect to proceedings concerning permits 
issued under the Federal Alcohol Administration Act or the Internal 
Revenue Code;
    (c) 27 CFR 47.44 with respect to proceedings concerning licenses 
issued under the Arms Export Control Act (22 U.S.C. 2778);
    (d) 27 CFR part 178, subpart E, with respect to proceedings 
concerning licenses issued under the Gun Control Act of 1968 (18 U.S.C. 
Chapter 44); and
    (e) 27 CFR part 181, subpart E, with respect to proceedings 
concerning licenses or permits issued under the Organized Crime Control 
Act of 1970 (18 U.S.C. Chapter 40).



Sec. 8.4  Director of Practice.

    (a) Appointment. The Secretary shall appoint the Director of 
Practice. In the event of the absence of the Director of Practice or a 
vacancy in that office, the Secretary shall designate an officer or 
employee of the Treasury Department to act as Director of Practice.
    (b) Duties. The Director of Practice, Office of the Secretary of the 
Treasury, shall: Act upon appeals from decisions of the Director denying 
applications for enrollment to practice before the Bureau; institute and 
provide for the conduct of disciplinary proceedings relating to 
attorneys, certified public accountants, and enrolled practitioners; 
make inquiries with respect to matters under his or her jurisdiction; 
and perform other duties as are necessary or appropriate to carry out 
his or her functions under this part or as are prescribed by the 
Secretary.



Sec. 8.5  Records.

    (a) Availability. Registers of all persons admitted to practice 
before the Bureau, and of all persons disbarred or suspended from 
practice, which are required to be maintained by the director under the 
provisions of Sec. 8.27, will be available for public inspection at the 
Office of the Director. Other records may be disclosed upon specific 
request in accordance with the disclosure regulations of the Bureau (27 
CFR part 71) and the Office of the Secretary.
    (b) Disciplinary proceedings. The Director, may grant a request by 
an attorney, certified public accountant, or enrolled practitioner to 
make public a hearing in a disciplinary proceeding, conducted under the 
provisions of subpart E of this part concerning the attorney, certified 
public accountant or enrolled practioner, and to make the record of the 
proceeding available for public inspection by interested persons, if an 
agreement is reached by stipulation in advance to prevent disclosure of 
any information which is confidential, in accordance with applicable 
laws and regulations.



Sec. 8.6  Special orders.

    The secretary reserves the power to issue special orders as he or 
she may deem proper in any cases within the scope of this part.



                          Subpart B_Definitions



Sec. 8.11  Meaning of terms.

    As used in this part, terms shall have the meaning given in this 
section. Words in the plural shall include the singular, and vice versa. 
The terms include and including do not exclude things not enumerated 
which are in the same general class.
    Administrative Law Judge. The person appointed pursuant to 5 U.S.C. 
3105, designated to preside over any administrative proceedings under 
this part.

[[Page 140]]

    Attorney. A person who is a member in good standing of the bar of 
the highest court of any State, possession, territory, Commonwealth, or 
the District of Columbia.
    Bureau. The Bureau of Alcohol, Tobacco and Firearms, the Department 
of the Treasury, Washington, DC 20226.
    Certified public accountant. Any person who is qualified to practice 
as a certified public accountant in any State, possession, territory, 
Commonwealth, or the District of Columbia.
    CFR. The Code of Federal Regulations.
    Director. The Director, Bureau of Alcohol, Tobacco and Firearms, the 
Department of the Treasury, Washington, DC.
    Enrolled practitioner. Any person enrolled to practice before the 
Bureau of Alcohol, Tobacco and Firearms pursuant to Subpart C of this 
part.
    Practice before the Bureau. This comprehends all matters connected 
with presentation to the Bureau or any of its officers or employees 
relating to a client's rights, privileges or liabilities under laws or 
regulations administered by the Bureau. Presentations include the 
preparation and filing of necessary documents, correspondence with and 
communications to the Bureau, and the representation of a client at 
conferences, hearings, and meetings. Preparation of a tax return, 
appearance of an individual as a witness for any party, or furnishing 
information at the request of the Bureau of any of its officers or 
employees is not considered practice before the Bureau.
    Secretary. The Secretary of the Treasury.
    U.S.C. The United States Code.



                     Subpart C_Enrollment Procedures



Sec. 8.21  Eligibility for enrollment.

    (a) General qualifications. The Director may grant enrollment to 
practice to any person who has not engaged in conduct which would 
justify the disbarment or suspension of any attorney, certified public 
accountant, or enrolled practioner. Each person shall demonstrate to the 
satisfaction of the Director that he or she possesses the necessary 
technical qualifications to enable him or her to render valuable service 
before the Bureau, and that he or she is otherwise competent to advise 
and assists in the presentation of matters before the Bureau.
    (b) Technical qualifications. The Director may grant enrollment to 
practice only to persons possessing technical knowledge of the laws and 
regulations administered by the Bureau.
    (1) Minimum criteria required of an enrolled practioner will consist 
of: 5 years employment with the Treasury Department in a responsible 
position which would familiarize the person with applicable laws and 
regualtions; or 5 years employment in a regulated industry in a 
responsible position which would familiarize the person with applicable 
laws and regulations; or possession of a law degree; or other 
significant experience such as the prior respresentation of persons 
before the Internal Revenue Service or the Bureau of Alcohol, Tobacco 
and Firearms.
    (2) An enrolled paractioner may demonstrate technical knowledge in 
one or more of the several areas of laws and regulations administered by 
the Bureau (alcohol, tobacco firearms, or explosives matters).
    (c) Natural persons. Enrollment to practice may only be granted to 
natural persons who have become 18 years of age.
    (d) Attorneys, certified public accountants. Enrollment if not 
available to persons who are attorneys or certified public accountants 
who qualify to practice without enrollment under Sec. 8.2 (a) or (b).

[42 FR 33026, June 29, 1977; 42 FR 36455, July 15, 1977]



Sec. 8.22  Application for enrollment.

    (a) Information to be furnished. An applicant for enrollment to 
practice shall state his or her name, address, and business address, 
citizenship, and age on the application. The applicant shall also state 
if he or she has ever been suspended or disbarred as an attorney or 
certified public accountant, or if the applicant's right to practice has 
ever been revoked by any court, commission, or administrative agency in 
any jurisdiction. The applicant shall set forth his or her technical 
qualifications as required by Sec. 8.21(b) which enable him or her to 
render valuable service

[[Page 141]]

before the Bureau. The applicant shall indicate which area or areas of 
Bureau matters in which he or she desires to practice (alcohol, tobacco, 
firearms, or explosives matters).
    (b) Fee. Each application for enrollment will be accompanied by a 
check or money order in the amount of $25, payable to the Bureau of 
Alcohol, Tobacco and Firearms. This fee will be retained by the United 
States whether or not the applicant is granted enrollment. Agents who 
are enrolled to practice before the Internal Revenue Service prior to 
September 27, 1977, need not include this fee and should indicate their 
enrollment number on the application.
    (c) Execution under oath. All applications for enrollment will be 
executed under oath or affirmation.
    (d) Filing. Applications for enrollment will be filed with the 
Assistant Director, Regulatory Enforcement, Bureau of Alcohol, Tobacco 
and Firearms, 1200 Pensylvania Avenue NW., Washington, DC 20226.
    (e) Additional information. The Director, as a condition to 
consideration for enrollment, may require the applicant to file 
additional information as necessary to determine if the applicant is 
qualified. The Director shall, upon written request, afford an applicant 
the opportunity to be heard with respect to his or her application for 
enrollment.

(Approved by the Office of Management and Budget under control number 
1512-0418)

(Sec. 501, Pub. L. 82-137, 65 Stat. 290 (31 U.S.C. 483a); 5 U.S.C. 
552(a) (80 Stat. 383, as amended))

[42 FR 33026, June 29, 1977; 42 FR 36455, July 15, 1977, as amended at 
49 FR 14944, Apr. 16, 1984]



Sec. 8.23  Denial of enrollment; appeal.

    (a) The Director, in denying an application for enrollment, shall 
inform the applicant as to the reasons. The applicant may, within 30 
days after receipt of the notice of denial, file a written appeal 
together with reasons in support thereof, with the Director of Practice. 
The Director of Practice shall render a decision on the appeal as soon 
as practicable.
    (b) An applicant may, within 30 days after receipt of the decision 
of the Director of Practice in sustaining a denial of enrollment, appeal 
the decision to the Secretary.



Sec. 8.24  Enrollment cards.

    The Director shall issue an enrollment card to each practitioner who 
is enrolled to practice before the Bureau. Each enrollment card is valid 
for a period of 5 years as long as the holder remains enrolled and in 
good standing before the Bureau. Unless advised to the contrary by the 
Director, any officer or employee of the Bureau may consider the holder 
of an unexpired enrollment card to be authorized to practice before the 
Bureau in the subject area or areas indicated upon the card (alcohol, 
tobacco, firearms, or explosives matters).



Sec. 8.25  Renewal of enrollment card.

    (a) Period of renewal. An enrolled practitioner may apply for 
renewal of his or her enrollment card during a 12-month period prior to 
the expiration of the enrollment card.
    (b) Application. Each enrolled practitioner applying for a renewal 
of enrollment shall apply to the Director. The enrolled practitioner 
shall include in the application all information required by Sec. 8.22 
except information relating to technical qualifications unless the 
enrolled practitioner is applying for enrollment in a subject area or 
areas in which he or she was not previously qualified to practice.
    (c) Fee. Each application for renewal of enrollment will be 
accompanied by a check or money order in the amount of $5, payable to 
the Bureau of Alcohol, Tobacco and Firearms.

(Approved by the Office of Management and Budget under control number 
1512-0418)

(5 U.S.C. 552(a) (80 Stat. 383, as amended))

[42 FR 33026, June 29, 1977, as amended at 49 FR 14944, Apr. 16, 1984]



Sec. 8.26  Change in enrollment.

    (a) Change in area of practice. At any time during a period of 
enrollment, an enrolled practitioner may apply to practice in a subject 
area or areas in which he or she was not previously qualified to 
practice (alcohol, tobacco, firearms, or explosives matters).

[[Page 142]]

    (b) Application. Each enrolled practitioner applying for a change in 
enrollment shall apply to the Director. The enrolled practitioner shall 
include in the application all information required by Sec. 8.22 but 
shall include information relating to technical qualifications only in 
those additional subject areas in which he or she is applying to 
practice.
    (c) Fee. Each application for change in enrollment will be 
accompanied by a check or money order in the amount of $5, payable to 
the Bureau of Alcohol, Tobacco and Firearms.

(Approved by the Office of Management and Budget under control number 
1512-0418)

(5 U.S.C. 552(a) (80 Stat. 383, as amended))

[42 FR 33026, June 29, 1977, as amended at 49 FR 14944, Apr. 16, 1984]



Sec. 8.27  Enrollment registers.

    The Director shall maintain, for public inspection, a register of 
all persons enrolled to practice before the Bureau and the subject areas 
in which each person is enrolled to practice, a register of all persons 
disbarred or suspended from practice, and a register of all persons 
whose applications for enrollment before the Bureau have been denied.



Sec. 8.28  Termination of enrollment.

    (a) Attorneys, certified public accountants. The enrollment of a 
practitioner to whom an enrollment card has been issued will terminate 
when that person becomes eligible to practice without enrollment under 
Sec. 8.2 (a) or (b), and that person shall surrender his or her 
enrollment card to the Director for cancellation.
    (b) Expiration of enrollment. The enrollment of any person will 
automatically terminate after the date indicated on the enrollment card 
unless, during the 12-month period prior to the expiration date, that 
person applies for renewal of enrollment with the Director as provided 
in Sec. 8.25. In this case, the person may continue to practice before 
the Bureau until his or her application has been finally determined.



Sec. 8.29  Limited practice without enrollment.

    (a) General. Individuals may appear on their own behalf and may 
otherwise appear without enrollment, providing they present satisfactory 
identification, in the following classes of cases:
    (1) An individual may represent another individual who is his or her 
regular full-time employer, may represent a partnership of which he or 
she is a member or a regular full-time employee, of may represent 
without compensation a member of his or her immediate family.
    (2) Corporations (including parent corporations, subsidiaries or 
affiliated corporations), trusts, estates, associations, or organized 
groups may be represented by bona fide officers or regular full-time 
employees.
    (3) Trusts, receiverships, guardianships, or estates may be 
represented by their trustees, receivers, guardians, administrators, 
executors, or their regular full-time employees.
    (4) Any government unit, agency, or authority may be represented by 
an officer or regular employee in the course of his or her official 
duties.
    (5) Unenrolled persons may participate in rulemaking as provided in 
5 U.S.C. 553.
    (b) Special appearances. The Director, subject to conditions he or 
she deems appropriate, may authorize any person to represent a party 
without enrollment, for the purpose of a particular matter.



         Subpart D_Duties and Restrictions Relating to Practice



Sec. 8.31  Furnishing of information.

    (a) To the Bureau. No attorney, certified public accountant, or 
enrolled practitioner may neglect or refuse promptly to submit records 
or information in any matter before the Bureau, upon proper and lawful 
request by an authorized officer or employee of the Bureau, or may 
interfere, or attempt to interfere, with any proper and lawful effort by 
the Bureau or its officers or employees, to obtain the requested record 
or information, unless he or she

[[Page 143]]

believes in good faith and on reasonable grounds that the record or 
information is privileged or that the request for, or effort to obtain, 
that record or information is of doubtful legality.
    (b) To the Director of Practice. It is the duty of an attorney or 
certified public accountant, who practices before the Bureau, or 
enrolled practitioner when requested by the Director of Practice, to 
provide the Director of Practice with any information he or she may have 
concerning violation of the regulations in this part by any person, and 
to testify thereto in any proceeding instituted under this part for the 
disbarment or suspension of an attorney, certified public accountant, or 
enrolled practitioner, unless he or she believes in good faith and on 
reasonable grounds that that information is privileged or that the 
request is of doubtful legality.



Sec. 8.32  Prompt disposition of pending matters.

    No attorney, certified public accountant, or enrolled practitioner 
may unreasonably delay the prompt disposition of any matter before the 
Bureau.



Sec. 8.33  Accuracy.

    Each attorney, certified public accountant, and enrolled 
practitioner shall exercise due diligence in:
    (a) Preparing or assisting in the preparation of, approving, and 
filing returns, documents, affidavits, and other papers relating to 
Bureau matters;
    (b) Determining the correctness of any representations made by him 
or her to the Bureau; and
    (c) Determining the correctness of any information which he or she 
imparts to a client with reference to any matter administered by the 
Bureau.



Sec. 8.34  Knowledge of client's omission.

    Each attorney, certified public accountant, or enrolled practitioner 
who knows that a client has not complied with applicable law, or has 
made an error in or omission from any document, affidavit, or other 
paper which the law requires the client to execute, shall advise the 
client promptly of the fact of such noncompliance, error, or omission.



Sec. 8.35  Assistance from disbarred or suspended persons and former 
Treasury employees.

    No attorney, certified public accountant or enrolled practitioner 
shall, in practice before the Bureau, knowingly and directly or 
indirectly:
    (a) Employ or accept assistance from any person who is under 
disbarment or suspension from practice before any agency of the Treasury 
Department;
    (b) Accept employment as associate, correspondent, or subagent from, 
or share fees with, any such person;
    (c) Accept assistance in a specific matter from any person who 
participated personally and substantially in the matter as an employee 
of the Treasury Department.

[44 FR 47059, Aug. 10, 1979]



Sec. 8.36  Practice by partners of Government employees.

    No partner of an officer or employee of the executive branch of the 
U.S. Government, of any independent agency of the United States, or of 
the District of Columbia, may represent anyone in any matter 
administered by the Bureau in which the Government employee participates 
or has participated personally and substantially as a Government 
employee, or which is the subject of that employee's official 
responsibility.



Sec. 8.37  Practice by former Government employees.

    (a) Violation of law. No former officer or employee of the U.S. 
Government, of any independent agency of the United States, or of the 
District of Columbia, may represent anyone in any matter administered by 
the Bureau if the representation would violate any of the laws of the 
United States.
    (b) Personal and substantial participation. No former officer or 
employee of the executive branch of the U.S. Goverment, of any 
independent agency of the United States, or of the District of Columbia, 
may represent anyone with repect to any matter under the administration 
of the Bureau, if he or she participated personally and substantially in 
that matter a a Government employee.
    (c) Official responsibility. No former officer or employee of the 
executive

[[Page 144]]

branch of the U.S. Government, of any indepenednt agency of the United 
States, or of the District of Columbia, may within one year after his or 
her employment has ceased, appear personally as a practitioner before 
the Bureau with respect to any matter administered by the Bureau if that 
representation involves a specific matter under the former employee's 
official responsibility as a Government employee, within a one-year 
period prior to the termination of that responsibility.
    (d) Aid or assistance. No former officer or employee of the Bureau, 
who is eligible to practice before the Bureau, may aid or assist any 
person in the representation of a specific matter in which the former 
officer or employee participated personally and substantially as an 
officer or employee of the Bureau.

(18 U.S.C. 207)



Sec. 8.38  Notaries.

    No attorney, certified public accountant, or enrolled practitioner 
may, with respect to any matter administered by the Bureau, take 
acknowledgements, administer oaths, certify papers, or perform any 
official act in connection with matters in which he or she is employed 
as counsel, attorney, or practioner, or in which he or she may be in any 
way interested before the Bureau.

(26 Op. Atty. Gen. 236)



Sec. 8.39  Fees.

    No attorney, certified public accountant, or enrolled practitioner 
may charge an unconscionable fee for representing a client in any matter 
before the Bureau.



Sec. 8.40  Conflicting interests.

    No attorney, certified public accountant, or enrolled practitioner 
may represent conflicting interests in practice before the Bureau, 
except by express consent of all directly interested parties after full 
disclosure has been made.



Sec. 8.41  Solicitation.

    (a) Advertising and solicitation restrictions. (1) No attorney, 
certified public accountant or enrolled practitioner shall, with respect 
to any Bureau matter, in any way use or participate in the use of any 
form of public communication containing a false, fraudulent, misleading, 
deceptive, unduly influencing, coercive or unfair statement or claim. 
For the purposes of this subsection, the prohibition includes, but is 
not limited to, statements pertaining to the quality of services 
rendered unless subject to factual verification, claims of specialized 
expertise not authorized by State or Federal agencies having 
jurisdiction over the practitioner, and statements or suggestions that 
the ingenuity and/or prior record of a representative rather than the 
merit of the matter are principal factors likely to determine the result 
of the matter.
    (2) No attorney, certified public accountant or enrolled 
practitioner shall make, directly or indirectly, an uninvited 
solicitation of employment, in matters related to the Bureau. 
Solicitation includes, but is not limited to, in-person contacts, 
telephone communications, and personal mailings directed to the specific 
circumstances unique to the recipient. This restriction does not apply 
to: (i) Seeking new business from an existing or former client in a 
related matter; (ii) solicitation by mailings, the contents of which are 
designed for the general public; or (iii) non-coercive in-person 
solicitation by those eligible to practice before the Bureau while 
acting as an employee, member, or officer of an exempt organization 
listed in sections 501(c) (3) or (4) of the Internal Revenue Code of 
1954 (26 U.S.C.).
    (b) Permissible advertising. (1) Attorneys, certified public 
accountants and enrolled practitioners may publish, broadcast, or use in 
a dignified manner through any means of communication set forth in 
paragraph (d) of this section:
    (i) The name, address, telephone number, and office hours of the 
practitioner or firm.
    (ii) The names of individuals associated with the firm.
    (iii) A factual description of the services offered.
    (iv) Acceptable credit cards and other credit arrangements.
    (v) Foreign language ability.

[[Page 145]]

    (vi) Membership in pertinent, professional organizations.
    (vii) Pertinent professional licenses.
    (viii) A statement that an individual's or firm's practice is 
limited to certain areas.
    (ix) In the case of an enrolled practitioner, the phrase ``enrolled 
to practice before the Bureau of Alcohol, Tobacco and Firearms.''
    (x) Other facts relevant to the selection of a practitioner in 
matters related to the Bureau which are not prohibited by these 
regulations.
    (2) Attorneys, certified public accountants and enrolled 
practitioners may use, to the extent they are consistent with the 
regulations in this section, customary biographical insertions in 
approved law lists and reputable professional journals and directories, 
as well as professional cards, letterheads and announcements: Provided, 
That (i) attorneys do not violate applicable standards of ethical 
conduct adopted by the American Bar Association, (ii) certified public 
accountants do not violate applicable standards of ethical conduct 
adopted by the American Institute of Certified Public Accountants, and 
(iii) enrolled practitioners do not violate applicable standards of 
ethical conduct adopted by the National Society of Public Accountants.
    (c) Fee information. (1) Attorneys, certified public accountants and 
enrolled practitioners may disseminate the following fee information:
    (i) Fixed fees for specific routine services.
    (ii) Hourly rates.
    (iii) Range of fees for particular services.
    (iv) Fee charged for an initial consultation.
    (2) Attorneys, certified public accountants and enrolled 
practitioners may also publish the availability of a written schedule of 
fees.
    (3) Attorneys, certified public accountants and enrolled 
practitioners shall be bound to charge the hourly rate, the fixed fee 
for specific routine services, the range of fees for particular 
services, or the fee for an initial consultation published for a 
reasonable period of time, but no less than thirty days from the last 
publication of such hourly rate or fees.
    (d) Communications. Communications, including fee information, shall 
be limited to professional lists, telephone directories, print media, 
permissible mailings as provided in these regulations, radio and 
television. In the case of radio and television broadcasting, the 
broadcast shall be pre-recorded and the practitioner shall retain a 
recording of the actual audio transmission.
    (e) Improper associations. An attorney, certified public accountant 
or enrolled practitioner may, in matters related to the Bureau, employ 
or accept employment or assistance as an associate, correspondent, or 
subagent from, or share fees with, any person or entity who, to the 
knowledge of the practitioner, obtains clients or otherwise practices in 
a manner forbidden under this section: Provided, That an attorney, 
certified public accountant or enrolled practitioner does not, directly 
or indirectly, act or hold himself out as authorized to practice before 
the Bureau in connection with that relationship. Nothing herein shall 
prohibit an attorney, certified public accountant, or enrolled 
practitioner from practice before the Bureau in a capacity other than 
that described above.

[44 FR 47060, Aug. 10, 1979]



Sec. 8.42  Practice of law.

    Nothing in the regulations in this part may be construed as 
authorizing persons not members of the bar to practice law.



                   Subpart E_Disciplinary Proceedings



Sec. 8.51  Authority to disbar or suspend.

    The Secretary, after due notice and opportunity for hearing, may 
suspend or disbar from practice before the Bureau any attorney, 
certified public accountant, or enrolled practitioner shown to be 
incompetent, disreputable or who refuses to comply with the rules and 
regulations in this part or who shall, with intent to defraud, in any 
manner willfully and knowingly deceive, mislead, or threaten any client

[[Page 146]]

or prospective client, by word, circular, letter, or by advertisement.

(Sec. 3, 23 Stat. 258 (31 U.S.C. 1026))



Sec. 8.52  Disreputable conduct.

    Disreputable conduct for which an attorney, certified public 
accountant, or enrolled practitioner may be disbarred or suspended from 
practice before the Bureau includes, but is not limited to:
    (a) Conviction of any criminal offense under the revenue laws of the 
United States; under any other law of the United States which the Bureau 
enforces pursuant to Treasury Department Order No. 221 (37 FR 11696) 
effective July 1, 1972; or for any offense involving dishonesty or 
breach of trust.
    (b) Giving false or misleading information, or participating in any 
way in the giving of false or misleading information, to the Bureau or 
any officer or employee thereof, or to any tribunal authorized to pass 
upon matters administered by the Bureau in connection with any matter 
pending or likely to be pending before them, knowing the information to 
be false or misleading. Facts or other matters contained in testimony, 
Federal tax returns, financial statements, applications for enrollment, 
affidavits, declarations, or any other document or statement, written or 
oral, are included in the term ``information''.
    (c) Solicitation of employment as prohibited under Sec. 8.41, the 
use of false or misleading representations with intent to deceive a 
client or a prospective client in order to procure employment, or 
intimating that the practitioner is able improperly to obtain special 
consideration or action from the Bureau or an officer or employee 
thereof.
    (d) Willfully failing to make a Federal tax return in violation of 
the revenue laws of the United States, or evading, attempting to evade, 
or participating in any way in evading or attempting to evade any 
Federal tax or payment thereof; knowingly counseling or suggesting to a 
client or prospective client an illegal plan to evade Federal taxes or 
payment thereof, or concealing assets of himself or herself, or of 
another in order to evade Federal taxes or payment thereof.
    (e) Misappropriation of, or failure properly and promptly to remit 
funds received from a client for the purpose of payment of taxes or 
other obligations due the United States.
    (f) Directly or indirectly attempting to influence, or offering or 
agreeing to attempt to influence, the official action of any officer or 
employee of the Bureau by the use of threats, false accusations, duress 
or coercion, by the offer of any special inducement or promise of 
advantage or by the bestowing of any gift, favor, or thing of value.
    (g) Disbarment or suspension from practice as an attorney or 
certified public accountant by any duly constituted authority of any 
State, possession, Commonwealth, the District of Columbia, or by any 
Federal court of record.
    (h) Disbarment or suspension from practice as an attorney, certified 
public accountant, or other person admitted to practice before the 
Internal Revenue Service.
    (i) Knowingly aiding and abetting another person to practice before 
the Bureau during a period of suspension, disbarment, or ineligibility 
of the other person. Maintaining a partnership for the practice of law, 
accountancy, or other related professional service with a person who is 
under disbarment from practice before the Bureau or the Intenal Revenue 
Service is presumed to be a violation of this provision.
    (j) Contemptuous conduct in connection with practice before the 
Bureau, including the use of abusive language, making false accusations 
and statements knowing them to be false, or circulating or publishing 
malicious or libelous matter.
    (k) Willful violatin of any of the regulations contained in this 
part.

[42 FR 33026, June 29, 1977; 42 FR 36455, July 15, 1977]



Sec. 8.53  Initiation of disciplinary proceedings.

    (a) Receipt of information. If an officer or employee of the Bureau 
has reason to believe that an attorney, certified public accountant, or 
enrolled practitioner has violated any of the provisions of this part or 
engaged in any disreputable conduct as defined in Sec. 8.52, the 
employee shall promptly make a

[[Page 147]]

report thereof which will be forwarded to the Director of Practice. Any 
other person possessing information concerning violations or 
disreputable conduct may make a report thereof to the Director of 
Practice or to any officer or employee of the Bureau.
    (b) Institution of proceeding. When the Director of Practice has 
reason to believe that any attorney, certified public accountant, or 
enrolled practitioner has violated any provisions of the laws or 
regulations governing practice before the Bureau, he or she may 
reprimand the person or institute a proceeding for the disbarment or 
suspension of that person. The proceeding will be instituted by a 
complaint which names the respondent and is signed by the Director of 
Practice and filed in his or her office. Except in cases of willfulness, 
or when time, the nature of the proceeding, or the public interest does 
not permit, the Director of Practice may not institute a proceeding 
until he or she has called to the attention of the proposed respondent, 
in writing, facts or conduct which warrant institution of a proceeding, 
and has accorded the proposed respondent the opportuity to demonstrate 
or achieve compliance with all lawful requirements.



Sec. 8.54  Conferences.

    (a) General. The Director of Practice may confer with an attorney, 
certified public accountant, or enrolled practioner concerning 
allegations of misconduct whether or not a proceeding for disbarment or 
suspension has been instituted. If a conference results in a stipulation 
in connection with a proceeding in which that person is the respondent, 
the stipulaton may be entered in the record at the instance of either 
party to the proceeding.
    (b) Resignation or voluntary suspension. An attorney, certified 
public accountant, or enrolled practitioner, in order to avoid the 
institution or conclusion of a disbarment or suspension proceeding, may 
offer his or her consent to suspension from practice before the Bureau. 
An enrolled practitioner may also offer a resignation. The Director of 
Practice, at his or her discretion, may accept the offered resignation 
of an enrolled practitioner and may suspend an attorney, certified 
public accountant, or enrolled practitioner in accordance with the 
consent offered.



Sec. 8.55  Contents of complaint.

    (a) Charges. A complaint will give a plain and concise description 
of the allegations which constitute the basis for the proceeding. A 
complaint will be deemed sufficient if it fairly informs the respondent 
of the charges to that he or she is able to prepare a defense.
    (b) Demand for answer. The complaint will give notification of the 
place and time prescribed for the filing of an answer by the respondent; 
that time will be not less than 15 days from the date of service of the 
complaint. Notice will be given that a decision by default may be 
rendered against the respondent if the complaint is not answered as 
required.



Sec. 8.56  Service of complaint and other papers.

    (a) Complaint. A copy of the complaint may be served upon the 
respondent by certified mail or by first-class mail. The copy of the 
complaint may be delivered to the respondent or the respondent's 
attorney or agent of record either in person or by leaving it at the 
office or place of business of the respondent, attorney or agent, or the 
complaint may be delivered in any manner which has been agreed to by the 
respondent. If the service is by certified mail, the post office receipt 
signed by or on behalf of the respondent will be proof of service. If 
the certified matter is not claimed or accepted by the respondent and is 
returned undelivered, complete service may be made upon the respondent 
by mailing the complaint to him or her by first-class mail, addressed to 
the respondent at the address under which he or she is enrolled or at 
the last address known to the Director of Practice. If service is made 
upon the respondent or the respondent's attorney or agent in person, or 
by leaving the complaint at the office or place of business of the 
respondent, attorney or agent, the verified return by the person making 
service, setting forth the manner of service, will be proof of service.
    (b) Service of other papers. Any paper other than the complaint may 
be

[[Page 148]]

served upon an attorney, certified public accountant, or enrolled 
practitioner as provided in paragraph (a) of this section, or by mailing 
the paper by first-class mail to the respondent at the last address 
known to the Director of Practice, or by mailing the paper by first-
class mail to the respondent's attorney or agent of record. This mailing 
will constitute complete service. Notices may be served upon the 
respondent or his attorney or agent by telegram.
    (c) Filing of papers. When the filing of a paper is required or 
permitted in connection with a disbarment or suspension proceeding, and 
the place of filing is not specified by this subpart or by rule or order 
of the Administrative Law Judge, the papers will be filed with the 
Director of Practice, Treasury Department, Washington, DC 20220. All 
papers will be filed in duplicate.



Sec. 8.57  Answer.

    (a) Filing. The respondent shall file the answer in writing within 
the time specified in the complaint or notice of institution of the 
proceeding, unless on application the time is extended by the Director 
of Practice or the Administrative Law Judge. The respondent shall file 
the answer in duplicate with the director of Practice.
    (b) Contents. The respondent shall include in the answer a statement 
of facts which constitute the grounds of defense, and shall specifically 
admit or deny each allegation set forth in the complaint, except that 
the respondent shall not deny a material allegation in the complaint 
which he or she knows to be true, or state that he or she is without 
sufficient information to form a belief when in fact the respondent 
possesses that information. The respondent may also state affirmatively 
special matters of defense.
    (c) Failure to deny or answer allegations in the complaint. Every 
allegation in the complaint which is not denied in the answer is deemed 
to be admitted and may be considered as proven, and no further evidence 
in respect of that allegation need be adduced at a hearing. Failure to 
file an answer within the time prescribed in the notice to the 
respondent, except as the time for answer is extended by the Director of 
Practice or the Administrative Law Judge, will constitute an admission 
of the allegations of the complaint and a waiver of hearing, and the 
Administrative Law Judge may make a decision by default without a 
hearing or further procedure.
    (d) Reply by Director of Practice. No reply to the respondent's 
answer is required, and new matter in the answer will be deemed to be 
denied, but the Director of Practice may file a reply at his or her 
discretion or at the request of the Administrative Law Judge.



Sec. 8.58  Supplemental charges.

    If it appears that the respondent in his or her answer, falsely and 
in bad faith, denies a material allegation of fact in the complaint or 
states that the respondent has no knowledge sufficient to form a belief, 
when he or she in fact possesses that information, or if it appears that 
the respondent has knowingly introduced false testimony during 
proceedings for his or her disbarment or suspension, the Director of 
Practice may file supplemental charges against the respondent. These 
supplemental charges may be tried with other charges in the case, 
provided the respondent is given due notice and is afforded an 
opportunity to prepare to a defense to them.



Sec. 8.59  Proof; variance; amendment of pleadings.

    In the case of a variance between the allegations in a pleading, the 
Administrative Law Judge may order or authorize amendment of the 
pleading to conform to the evidence. The party who would otherwise be 
prejudiced by the amendment will be given reasonable opportunty to meet 
the allegation of the pleading as amended, and the Administrative Law 
Judge shall make findings on an issue presented by the pleadings as so 
amended.



Sec. 8.60  Motions and requests.

    Motions and requests may be filed with the Director of Practice or 
with the Administrative Law Judge.



Sec. 8.61  Representation.

    A respondent or proposed respondent may appear in person or be 
represented by counsel or other representative who need not be enrolled 
to practice before

[[Page 149]]

the Bureau. The Director of Practice may be represented by an Attorney 
or other employee of the Treasury Department.



Sec. 8.62  Administrative Law Judge.

    (a) Appointment. An Administrative Law Judge, appointed as provided 
by 5 U.S.C. 3105, shall conduct proceedings upon complaints for the 
disbarment or suspension of attorneys, certified public accountants, or 
enrolled practitioners.
    (b) Responsibilities. The Administrative Law Judge in connection 
with any disbarment or suspension proceeding shall have authority to:
    (1) Administer oaths and affirmation;
    (2) Make rulings upon motions and requests; these rulings may not be 
appealed prior to the close of the hearing except at the discretion of 
the Administrative Law Judge in extraordinary circumstances;
    (3) Rule upon offers of proof, receive relevant evidence, and 
examine witnesses;
    (4) Take or authorize to the taking of depositions;
    (5) Determine the time and place of hearing and regulate its course 
and conduct;
    (6) Hold or provide for the holding of conferences to settle or 
simplify the issues by consent of the parties;
    (7) Receive and consider oral or written arguments on facts or law;
    (8) Make initial decisions;
    (9) Adopt rules of procedure and modify them from time to time as 
occasion requires for the orderly disposition of proceedings; and
    (10) Perform acts and take measures as necessary to promote the 
efficient conduct of any proceeding.



Sec. 8.63  Hearings.

    (a) Conduct. The Administrative Law Judge shall preside at the 
hearing on a complaint for the disbarment or suspension of an attorney, 
certified public accountant, or enrolled practitioner. Hearings will be 
stenographically recorded and transcribed and the testimony of witnesses 
will be received under oath or affirmation. The Administrative Law Judge 
shall conduct hearings pursuant to 5 U.S.C. 556.
    (b) Failure to appear. If either party to the proceedings fails to 
appear at the hearing, after due notice has been sent, the 
Administrative Law Judge may deem them to have waived the right to a 
hearing and may make a decision against the absent party by default.



Sec. 8.64  Evidence.

    (a) Rules of evidence. The rules of evidence prevailing in courts of 
law and equity are not controlling in hearings. However, the 
Administrative Law Judge shall exclude evidence which is irrelevant, 
immaterial, or unduly repetitious.
    (b) Depositions. Depositions of witnesses taken pursuant to Sec. 
8.65 may be admitted as evidence.
    (c) Government documents. Official documents, records, and papers of 
the Bureau of Alcohol, Tobacco and Firearms and the Office of the 
Director of Practice are admissible in evidence without the prouction of 
an officer or employee to authenticate them. These documents, records 
and papers may be evidenced by a copy attested or identified by an 
officer or employee of the Bureau or the Treasury Department.
    (d) Exhibits. If any document, record, or other paper is introduced 
in evidence as an exhibit, the Administrative Law Judge may authorize 
the withdrawal of the exhibit subject to any conditions he or she deems 
proper.
    (e) Objections. Objections to evidence will be in short form, 
stating the grounds of objection and the record may not include 
arguments thereon, except as ordered by the Administrative Law Judge. 
Rulings on objections will be a part of the record. No exception to the 
ruling is necessary to preserve the rights of the parties.



Sec. 8.65  Depositions.

    Depositions for use at a hearing may, with the written approval of 
the Administrative Law Judge, be taken by either the Director of 
Practice or the respondent or their authorized representatives. 
Depositions may be taken upon oral or written questioning, upon not less 
than 10 days' written notice to the other party before any officer 
authorized to administer an oath for general purposes or before an 
officer or

[[Page 150]]

employee of the Bureau authorized to administer an oath pursuant to 27 
CFR 70.35. The written notice will state the names of the witnesses and 
the time and place where the depositions are to be taken. The 
requirement of 10 days' notice may be waived by the parties in writing, 
and depositions may then be taken from the persons and at the times and 
places mutually agreed to by the parties. When a deposition is taken 
upon written questioning, any cross-examination will be upon written 
questioning. Copies of the written questioning will be served upon the 
other party with the notice, and copies of any written cross-
interrogation will be mailed or delivered to the opposing party at least 
5 days before the date of taking the depositions, unless the parties 
mutually agree otherwise. A party on whose behalf a deposition is taken 
must file it with the Administrative Law Judge and serve one copy upon 
the opposing party. Expenses in the reproduction of depositions will be 
borne by the party at whose instance the deposition is taken.



Sec. 8.66  Transcript.

    In cases in which the hearing is stenographically reported by a 
Government contract reporter, copies of the transcript may be obtained 
from the reporter at rates not to exceed the maximum rates fixed by 
contract between the Government and the reporter. If the hearing is 
stenographically reported by a regular employee of the Bureau, a copy of 
the hearing will be supplied to the respondent either without charge or 
upon the payment of a reasonable fee. Copies of exhibits introduced at 
the hearing or at the taking of depositions will be supplied to the 
parties upon the payment of a reasonable fee.

(Sec. 501, Pub. L. 82-137, 65 Stat. 290 (31 U.S.C. 483a))



Sec. 8.67  Proposed findings and conclusions.

    Except in cases when the respondent has failed to answer the 
complaint or when a party has failed to appear at the hearing, the 
Administrative Law Judge, prior to making his or her decision, shall 
afford the parties a reasonable opportunity to submit proposed findings 
and conclusions and their supporting reasons.



Sec. 8.68  Decision of Administrative Law Judge.

    As soon as practicable after the conclusion of a hearing and the 
receipt of any proposed findings and conclusions timely submitted by the 
parties, the Administrative Law Judge shall make the initial decision in 
the case. The decision will include (a) a statement of findings and 
conclusions, as well as the reasons or basis therefor, upon all the 
material issues of fact, law, or discretion presented on the record, and 
(b) an order of disbarment, suspension, or reprimand or an order of 
dismissal of the complaint. The Administrative Law Judge shall file the 
decision with the Director of Practice and shall transmit a copy to the 
respondent or the respondent's attorney of record. In the absence of an 
appeal to the Secretary, or review of the decision upon motion of the 
Secretary, the decision of the Administrative Law Judge will, without 
further proceedings, become the decision of the Secretary of the 
Treasury 30 days from the date of the Administrative Law Judge's 
decision.



Sec. 8.69  Appeal to the Secretary.

    Within 30 days from the date of the Administrative Law Judge's 
decision, either party may appeal to the Secretary. The appeal will be 
filed with the Director of Practice in duplicate and will include 
exceptions to the decision of the Administrative Law Judge and 
supporting reasons for those exceptions. If the Director of Practice 
files the appeal, he or she shall transmit a copy of it to the 
respondent. Within 30 days after receipt of an appeal or copy thereof, 
the other party may file a reply brief in duplicate with the Director of 
Practice. If the Director of Practice files the reply brief, he or she 
shall transmit a copy of it to the respondent. Upon the filing of an 
appeal and a reply brief, if any, the Director of Practice shall 
transmit the entire record to the Secretary.



Sec. 8.70  Decision of the Secretary.

    On appeal from or review of the intial decision of the 
Administrative Law Judge, the Secretary shall make the

[[Page 151]]

agency decision. In making this decision, the Secretary shall review the 
record or those portions of the records as may be cited by the parties 
in order to limit the issues. The Director of Prasctice shall transmit a 
copy of the Secretary's decision to the respondent.



Sec. 8.71  Effect of disbarment or suspension.

    (a) Disbarment. If the final order against the respondent is for 
disbarment, the respondent will not thereafter be permitted to practice 
before the Bureau unless authorized to do so by the Director of Practice 
pursuant to Sec. 8.72.
    (b) Suspension. If the final order against the respondent is for 
suspension, the respondent will not thereafter be permitted to practice 
before the Bureau during the period of suspension.
    (c) Surrender of enrollment card. If an enrolled practitioner is 
disbarred or suspended, he or she shall surrender the enrollment card to 
the Director of Practice for cancellation, in the case of disbarment, or 
for retention during the period of suspension.
    (d) Notice of disbarment or suspension. Upon the issuance of a final 
order for suspension or disbarment, the Director of Practice shall give 
notice of the order to appropriate officers and employees of the Bureau 
of Alcohol, Tobacco and Firearms and to interested departments and 
agencies of the Federal Government. The Director of Practice may also 
give notice as he or she may determine to the proper authorities of the 
State in which the disbarred or suspended person was licensed to 
practice as an attorney or certified public accountant.



Sec. 8.72  Petition for reinstatement.

    The Director of Practice may entertain a petition for reinstatement 
from any person disbarred from practice before the Bureau after the 
expiration of 5 years following disbarment. The director of Practice may 
not grant reinstatement unless he or she is satisfied that the 
petitioner is not likely to conduct himself or herself contrary to the 
regulations in this part, and that granting reinstatement would not be 
contrary to the public interest.



PART 9_EFFECTS OF IMPORTED ARTICLES ON THE NATIONAL SECURITY--Table 
of Contents




Sec.
9.2 Definitions.
9.3 General.
9.4 Criteria for determining effects of imports on national security.
9.5 Applications for investigation.
9.6 Confidential information.
9.7 Conduct of investigation.
9.8 Emergency action.
9.9 Report.

    Authority: Sec. 232, as amended, 76 Stat. 877, 80 Stat. 369 (19 
U.S.C. 1862); 5 U.S.C. 301; Reorg. Plan No. 1 of 1973; and E.O. 11725, 
June 27, 1973 (38 FR 17175).



Sec. 9.2  Definitions.

    As used herein, Secretary means the Secretary of the Treasury and 
Assistant Secretary means the Assistant Secretary of the Treasury 
(Enforcement, Operations, and Tariff Affairs).

[40 FR 50717, Oct. 31, 1975]



Sec. 9.3  General.

    (a) Upon request of the head of any Government department or agency, 
upon application of an interested party, or upon his own motion, the 
Assistant Secretary shall set in motion an immediate investigation to 
determine the effects on the national security of imports of any 
article.
    (b) The Secretary shall report the findings of his investigation 
under paragraph (a) of this section with respect to the effect of the 
importation of such article in such quantities or under such 
circumstances upon the national security and, based on such findings, 
his recommendation for action or inaction to the President within one 
year after receiving an application from an interested party or 
otherwise beginning an investigation under this section.

[39 FR 10898, Mar. 22, 1974, as amended at 40 FR 50717, Oct. 31, 1975]



Sec. 9.4  Criteria for determining effects of imports on national 
security.

    (a) In determining the effect on the national security of imports of 
the article which is the subject of the investigation, the Secretary is 
required to take into consideration the following:

[[Page 152]]

    (1) Domestic production needed for projected national defense 
requirements including restoration and rehabilitation.
    (2) The capacity of domestic industries to meet such projected 
requirements, including existing and anticipated availabilities of:
    (i) Human resources.
    (ii) Products.
    (iii) Raw materials.
    (iv) Production equipment and facilities.
    (v) Other supplies and services essential to the national defense.
    (3) The requirement of growth of such industries and such supplies 
and services including the investment, exploration and development 
necessary to assure capacity to meet projected defense requirements.
    (4) The effect which the quantities, availabilities, character and 
uses of imported goods have or will have on such industries and the 
capacity of the United States to meet national security requirements.
    (5) The economic welfare of the Nation as it is related to our 
national security, including the impact of foreign competition on the 
economic welfare of individual domestic industries. In determining 
whether such impact may impair the national security, any substantial 
unemployment, decrease in revenues of government, loss of skills or 
investment, or other serious effects shall be considered.
    (b) The Secretary shall also consider other relevant factors in 
determining whether the national security is affected by imports of the 
article.

[39 FR 10898, Mar. 22, 1974]



Sec. 9.5  Applications for investigation.

    (a) Applications shall be in writing. Twenty-five copies shall be 
filed by mail with the Assistant Secretary (Enforcement, Operations, and 
Tariff Affairs), Department of the Treasury, Washington, DC 20220.
    (b) Applications shall describe how the quantities or circumstances 
of imports of the particular article affect the national security and 
shall contain the following information:
    (1) Identification of the person, partnership, association, 
corporation, or other entity on whose behalf the application is filed.
    (2) A precise description of the article.
    (3) Description of the applicant and the domestic industry 
concerned, including pertinent information regarding companies and their 
plants, locations, capacity and current output of the domestic industry 
concerned with the article in question.
    (4) Pertinent statistics showing the quantities and values of both 
imports and production in the United States.
    (5) Nature, sources, and degree of the competition created by 
imports of the article in question.
    (6) The effect, if any, of imports of the article in question upon 
the restoration of domestic production capacity in an emergency.
    (7) Employment and special skills involved in the domestic 
production of the article.
    (8) Extent to which investment and specialized productive capacity 
is or will be adversely affected.
    (9) Revenues of Federal, State, or local Governments which are or 
may be affected by the volume or circumstances of imports of the 
article.
    (10) Defense or defense supporting uses of the article including 
data on defense contracts or sub-contracts, both past and current.
    (c) Statistical material presented should be on a calendar-year 
basis for sufficient periods of time to indicate trends and afford the 
greatest possible assistance to the Assistant Secretary. Monthly or 
quarterly data for the latest complete years should be included as well 
as any other breakdowns which may be pertinent to show seasonal or 
short-term factors.

[39 FR 10898, Mar. 22, 1974, as amended at 40 FR 50717, Oct. 31, 1975]



Sec. 9.6  Confidential information.

    Information submitted in confidence which the Assistant Secretary 
determines would disclose trade secrets and commercial or financial 
information obtained from a person and privileged, within the meaning of 
5 U.S.C. 552 and 31 CFR part 1, will be accorded confidential treatment. 
All information submitted in confidence must be on

[[Page 153]]

separate pages marked ``Business Confidential.''

[40 FR 50717, Oct. 31, 1975]



Sec. 9.7  Conduct of investigation.

    (a) The investigation by the Assistant Secretary or by such official 
or agency as he may designate, shall be such as to enable the Secretary 
to arrive at a fully informed opinion as to the effect on the national 
security of imports of the article in question.
    (b) If the Assistant Secretary determines that it is appropriate to 
hold public hearings or otherwise afford interested parties an 
opportunity to present information and advice relevant to an 
investigation, he shall issue a public notice which shall be published 
in the Federal Register. Such notice shall include a statement of the 
time, place and nature of any public hearing or shall solicit from any 
interested party written comments, opinions, or data relative to the 
investigation, to be submitted to the Assistant Secretary within the 
time period specified in the notice. Rebuttal to material so submitted 
may be filed with the Assistant Secretary within such time as is 
specified in the public notice. All data, comments and opinions shall be 
submitted with 25 copies.
    (c) All applications filed and all comments, opinions, and data 
submitted pursuant to paragraph (b) of this section, except information 
determined to be confidential as provided in Sec. 9.6, will be 
available for inspection and copying at the Office of the Assistant 
Secretary (Enforcement, Operations, and Tariff Affairs), Department of 
the Treasury, in Washington, DC. The Assistant Secretary will maintain a 
roster of persons who have submitted materials.
    (d) The Assistant Secretary or his designee may also request further 
data from other sources through the use of questionnaires, 
correspondence, or other means.
    (e) The Assistant Secretary or his delegate shall, in the course of 
the investigation, seek information or advice from, and consult with, 
the Secretary of Defense, the Secretary of Commerce, or their delegates, 
and any other appropriate officer of the United States as the Assistant 
Secretary shall determine.
    (f) In addition, the Assistant Secretary, or his designee, may, when 
he deems it appropriate, hold public hearings to elicit further 
information. If a hearing is held:
    (1) The time and place thereof will be published in the Federal 
Register.
    (2) It will be conducted by the Assistant Secretary or his designee, 
and the full record will be considered by the Secretary in arriving at 
his determination.
    (3) Interested parties may appear, either in person or by 
representation, and produce oral or written evidence relevant and 
material to the subject matter of the investigation.
    (4) After a witness has testified the Assistant Secretary or his 
designee may question the witness. Questions submitted to the Assistant 
Secretary or his designee in writing by any interested party may, at the 
discretion of the Assistant Secretary or his designee, be posed to the 
witness for reply for the purpose of assisting the Assistant Secretary 
in obtaining the material facts with respect to the subject matter of 
the investigation.
    (5) The hearing will be stenographically reported. The Assistant 
Secretary will not cause transcripts of the record of the hearing to be 
distributed to the interested parties, but a transcript may be inspected 
at the Office of the Assistant Secretary (Enforcement, Operations, and 
Tariff Affairs), Department of the Treasury, in Washington, DC, or 
purchased from the reporter.

[39 FR 10898, Mar. 22, 1974, as amended at 40 FR 50717, Oct. 31, 1975]



Sec. 9.8  Emergency action.

    In emergency situations or when in his judgment national security 
interests require it, the Secretary may vary or dispense with any of the 
procedures set forth above and may formulate his views without following 
such procedures.

[39 FR 10898, Mar. 22, 1974]



Sec. 9.9  Report.

    A report will be made and published in the Federal Register upon the 
disposition of each request, application or motion under Sec. 9.3. 
Copies of the report will be available at the Office of the

[[Page 154]]

Assistant Secretary (Enforcement, Operations, and Tariff Affairs), 
Department of the Treasury.

[40 FR 50718, Oct. 31, 1975]



PART 10_PRACTICE BEFORE THE INTERNAL REVENUE SERVICE--Table of Contents




Sec.
10.0 Scope of part.

             Subpart A_Rules Governing Authority to Practice

10.1 Director of Practice.
10.2 Definitions.
10.3 Who may practice.
10.4 Eligibility for enrollment.
10.5 Application for enrollment.
10.6 Enrollment.
10.7 Representing oneself; participating in rulemaking; limited 
          practice; special appearances; and return preparation.
10.8 Customhouse brokers.

   Subpart B_Duties and Restrictions Relating to Practice Before the 
                        Internal Revenue Service

10.20 Information to be furnished.
10.21 Knowledge of client's omission.
10.22 Diligence as to accuracy.
10.23 Prompt disposition of pending matters.
10.24 Assistance from or to disbarred or suspended persons and former 
          Internal Revenue Service employees.
10.25 Practice by former Government employees, their partners and their 
          associates.
10.26 Notaries.
10.27 Fees.
10.28 Return of client's records.
10.29 Conflicting interests.
10.30 Solicitation.
10.31 Negotiation of taxpayer checks.
10.32 Practice of law.
10.33 Best practices for tax advisors.
10.34 Standards for advising with respect to tax return positions and 
          for preparing or signing returns.
10.35 Requirements for covered opinions.
10.36 Procedures to ensure compliance.
10.37 Requirements for other written advice.
10.38 Establishment of advisory committees.

          Subpart C_Sanctions for Violation of the Regulations

10.50 Sanctions.
10.51 Incompetence and disreputable conduct.
10.52 Violation of regulations.
10.53 Receipt of information concerning practitioner.

         Subpart D_Rules Applicable to Disciplinary Proceedings

10.60 Institution of proceeding.
10.61 Conferences.
10.62 Contents of complaint.
10.63 Service of complaint; service and filing of other papers.
10.64 Answer; default.
10.65 Supplemental charges.
10.66 Reply to answer.
10.67 Proof; variance; amendment of pleadings.
10.68 Motions and requests.
10.69 Representation; ex parte communication.
10.70 Administrative Law Judge.
10.71 Hearings.
10.72 Evidence.
10.73 Depositions.
10.74 Transcript.
10.75 Proposed findings and conclusions.
10.76 Decision of Administrative Law Judge.
10.77 Appeal of decision of Administrative Law Judge.
10.78 Decision on appeal.
10.79 Effect of disbarment, suspension, or censure.
10.80 Notice of disbarment, suspension, censure, or disqualification.
10.81 Petition for reinstatement.
10.82 Expedited suspension upon criminal conviction or loss of license 
          for cause.

                      Subpart E_General Provisions

10.90 Records.
10.91 Saving clause.
10.92 Special orders.
10.93 Effective date.

    Authority: Sec. 3, 23 Stat. 258, secs. 2-12, 60 Stat. 237 et seq.; 5 
U.S.C. 301, 500, 551-559; 31 U.S.C. 330; Reorg. Plan No. 26 of 1950, 15 
FR 4935, 64 Stat. 1280, 3 CFR, 1949-1953 Comp., p. 1017.

    Source: Department Circular 230, Revised, 31 FR 10773, Aug. 13, 
1966, unless otherwise noted.



Sec. 10.0  Scope of part.

    This part contains rules governing the recognition of attorneys, 
certified public accountants, enrolled agents, and other persons 
representing clients before the Internal Revenue Service. Subpart A of 
this part sets forth rules relating to authority to practice before the 
Internal Revenue Service; subpart B of this part prescribes the duties 
and restrictions relating to such practice;

[[Page 155]]

subpart C of this part contains rules relating to disciplinary 
proceedings; subpart D of this part contains rules applicable to 
disqualification of appraisers; and Subpart E of this part contains 
general provisions, including provisions relating to the availability of 
official records.

[59 FR 31526, June 20, 1994]



             Subpart A_Rules Governing Authority to Practice

    Source: 67 FR 48765, July 26, 2002, unless otherwise noted.



Sec. 10.1  Director of Practice.

    (a) Establishment of office. The Office of Director of Practice is 
established in the Office of the Secretary of the Treasury. The Director 
of Practice is appointed by the Secretary of the Treasury, or his or her 
designate.
    (b) Duties. The Director of Practice acts on applications for 
enrollment to practice before the Internal Revenue Service; makes 
inquiries with respect to matters under his or her jurisdiction; 
institutes and provides for the conduct of disciplinary proceedings 
relating to attorneys, certified public accountants, enrolled agents, 
enrolled actuaries and appraisers; and performs other duties as are 
necessary or appropriate to carry out his or her functions under this 
part or as are prescribed by the Secretary of the Treasury, or his or 
her delegate.
    (c) Acting Director of Practice. The Secretary of the Treasury, or 
his or her delegate, will designate an officer or employee of the 
Treasury Department to act as Director of Practice in the absence of the 
Director or a vacancy in that office.



Sec. 10.2  Definitions.

    As used in this part, except where the text clearly provides 
otherwise:
    (a) Attorney means any person who is a member in good standing of 
the bar of the highest court of any State, territory, or possession of 
the United States, including a Commonwealth, or the District of 
Columbia.
    (b) Certified public accountant means any person who is duly 
qualified to practice as a certified public accountant in any State, 
territory, or possession of the United States, including a Commonwealth, 
or the District of Columbia.
    (c) Commissioner refers to the Commissioner of Internal Revenue.
    (d) Practice before the Internal Revenue Service comprehends all 
matters connected with a presentation to the Internal Revenue Service or 
any of its officers or employees relating to a taxpayer's rights, 
privileges, or liabilities under laws or regulations administered by the 
Internal Revenue Service. Such presentations include, but are not 
limited to, preparing and filing documents, corresponding and 
communicating with the Internal Revenue Service, and representing a 
client at conferences, hearings, and meetings.
    (e) Practitioner means any individual described in paragraphs (a), 
(b), (c), or (d) of Sec. 10.3.
    (f) A tax return includes an amended tax return and a claim for 
refund.
    (g) Service means the Internal Revenue Service.



Sec. 10.3  Who may practice.

    (a) Attorneys. Any attorney who is not currently under suspension or 
disbarment from practice before the Internal Revenue Service may 
practice before the Internal Revenue Service by filing with the Internal 
Revenue Service a written declaration that he or she is currently 
qualified as an attorney and is authorized to represent the party or 
parties on whose behalf he or she acts.
    (b) Certified public accountants. Any certified public accountant 
who is not currently under suspension or disbarment from practice before 
the Internal Revenue Service may practice before the Internal Revenue 
Service by filing with the Internal Revenue Service a written 
declaration that he or she is currently qualified as a certified public 
accountant and is authorized to represent the party or parties on whose 
behalf he or she acts.
    (c) Enrolled agents. Any individual enrolled as an agent pursuant to 
this part who is not currently under suspension or disbarment from 
practice before the Internal Revenue Service may practice before the 
Internal Revenue Service.

[[Page 156]]

    (d) Enrolled actuaries. (1) Any individual who is enrolled as an 
actuary by the Joint Board for the Enrollment of Actuaries pursuant to 
29 U.S.C. 1242 who is not currently under suspension or disbarment from 
practice before the Internal Revenue Service may practice before the 
Internal Revenue Service by filing with the Internal Revenue Service a 
written declaration stating that he or she is currently qualified as an 
enrolled actuary and is authorized to represent the party or parties on 
whose behalf he or she acts.
    (2) Practice as an enrolled actuary is limited to representation 
with respect to issues involving the following statutory provisions in 
title 26 of the United States Code: sections 401 (relating to 
qualification of employee plans), 403(a) (relating to whether an annuity 
plan meets the requirements of section 404(a)(2)), 404 (relating to 
deductibility of employer contributions), 405 (relating to qualification 
of bond purchase plans), 412 (relating to funding requirements for 
certain employee plans), 413 (relating to application of qualification 
requirements to collectively bargained plans and to plans maintained by 
more than one employer), 414 (relating to definitions and special rules 
with respect to the employee plan area), 419 (relating to treatment of 
funded welfare benefits), 419A (relating to qualified asset accounts), 
420 (relating to transfers of excess pension assets to retiree health 
accounts), 4971 (relating to excise taxes payable as a result of an 
accumulated funding deficiency under section 412), 4972 (relating to tax 
on nondeductible contributions to qualified employer plans), 4976 
(relating to taxes with respect to funded welfare benefit plans), 4980 
(relating to tax on reversion of qualified plan assets to employer), 
6057 (relating to annual registration of plans), 6058 (relating to 
information required in connection with certain plans of deferred 
compensation), 6059 (relating to periodic report of actuary), 6652(e) 
(relating to the failure to file annual registration and other 
notifications by pension plan), 6652(f) (relating to the failure to file 
information required in connection with certain plans of deferred 
compensation), 6692 (relating to the failure to file actuarial report), 
7805(b) (relating to the extent to which an Internal Revenue Service 
ruling or determination letter coming under the statutory provisions 
listed here will be applied without retroactive effect); and 29 U.S.C. 
1083 (relating to the waiver of funding for nonqualified plans).
    (3) An individual who practices before the Internal Revenue Service 
pursuant to paragraph (d)(1) of this section is subject to the 
provisions of this part in the same manner as attorneys, certified 
public accountants and enrolled agents.
    (e) Others. Any individual qualifying under paragraph (d) of Sec. 
10.5 or Sec. 10.7 is eligible to practice before the Internal Revenue 
Service to the extent provided in those sections.
    (f) Government officers and employees, and others. An individual, 
who is an officer or employee of the executive, legislative, or judicial 
branch of the United States Government; an officer or employee of the 
District of Columbia; a Member of Congress; or a Resident Commissioner 
may not practice before the Internal Revenue Service if such practice 
violates 18 U.S.C. 203 or 205.
    (g) State officers and employees. No officer or employee of any 
State, or subdivision of any State, whose duties require him or her to 
pass upon, investigate, or deal with tax matters for such State or 
subdivision, may practice before the Internal Revenue Service, if such 
employment may disclose facts or information applicable to Federal tax 
matters.



Sec. 10.4  Eligibility for enrollment.

    (a) Enrollment upon examination. The Director of Practice may grant 
enrollment to an applicant who demonstrates special competence in tax 
matters by written examination administered by, or administered under 
the oversight of, the Director of Practice and who has not engaged in 
any conduct that would justify the censure, suspension, or disbarment of 
any practitioner under the provisions of this part.
    (b) Enrollment of former Internal Revenue Service employees. The 
Director of Practice may grant enrollment to an applicant who, by virtue 
of his or her past service and technical experience

[[Page 157]]

in the Internal Revenue Service, has qualified for such enrollment and 
who has not engaged in any conduct that would justify the censure, 
suspension, or disbarment of any practitioner under the provisions of 
this part, under the following circumstances--
    (1) The former employee applies for enrollment to the Director of 
Practice on a form supplied by the Director of Practice and supplies the 
information requested on the form and such other information regarding 
the experience and training of the applicant as may be relevant.
    (2) An appropriate office of the Internal Revenue Service, at the 
request of the Director of Practice, will provide the Director of 
Practice with a detailed report of the nature and rating of the 
applicant's work while employed by the Internal Revenue Service and a 
recommendation whether such employment qualifies the applicant 
technically or otherwise for the desired authorization.
    (3) Enrollment based on an applicant's former employment with the 
Internal Revenue Service may be of unlimited scope or it may be limited 
to permit the presentation of matters only of the particular class or 
only before the particular unit or division of the Internal Revenue 
Service for which the applicant's former employment has qualified the 
applicant.
    (4) Application for enrollment based on an applicant's former 
employment with the Internal Revenue Service must be made within 3 years 
from the date of separation from such employment.
    (5) An applicant for enrollment who is requesting such enrollment 
based on his or her former employment with the Internal Revenue Service 
must have had a minimum of 5 years continuous employment with the 
Internal Revenue Service during which he or she must have been regularly 
engaged in applying and interpreting the provisions of the Internal 
Revenue Code and the regulations thereunder relating to income, estate, 
gift, employment, or excise taxes.
    (6) For the purposes of paragraph (b)(5) of this section, an 
aggregate of 10 or more years of employment in positions involving the 
application and interpretation of the provisions of the Internal Revenue 
Code, at least 3 of which occurred within the 5 years preceding the date 
of application, is the equivalent of 5 years continuous employment.
    (c) Natural persons. Enrollment to practice may be granted only to 
natural persons.



Sec. 10.5  Application for enrollment.

    (a) Form; address. An applicant for enrollment must file an 
application on Form 23, ``Application for Enrollment to Practice Before 
the Internal Revenue Service,'' properly executed under oath or 
affirmation, with the Director of Practice. The address of the applicant 
entered on Form 23 will be the address under which a successful 
applicant is enrolled and is the address to which the Director of 
Practice will send correspondence concerning enrollment. An enrolled 
agent must send notification of any change to his or her enrollment 
address to the Director of Practice, Internal Revenue Service, 1111 
Constitution Avenue, NW., Washington, DC 20224, or at such other address 
specified by the Director of Practice. This notification must include 
the enrolled agent's name, old address, new address, social security 
number or tax identification number, signature, and the date.
    (b) Fee. The application for enrollment must be accompanied by a 
check or money order in the amount set forth on Form 23, payable to the 
Internal Revenue Service, which amount constitutes a fee charged to each 
applicant for enrollment. This fee will be retained by the United States 
whether or not the applicant is granted enrollment.
    (c) Additional information; examination. The Director of Practice, 
as a condition to consideration of an application for enrollment, may 
require the applicant to file additional information and to submit to 
any written or oral examination under oath or otherwise. The Director of 
Practice will, on written request filed by an applicant, afford such 
applicant the opportunity to be heard with respect to his or her 
application for enrollment.
    (d) Temporary recognition. On receipt of a properly executed 
application, the

[[Page 158]]

Director of Practice may grant the applicant temporary recognition to 
practice pending a determination as to whether enrollment to practice 
should be granted. Temporary recognition will be granted only in unusual 
circumstances and it will not be granted, in any circumstance, if the 
application is not regular on its face, if the information stated in the 
application, if true, is not sufficient to warrant enrollment to 
practice, or if there is any information before the Director of Practice 
indicating that the statements in the application are untrue or that the 
applicant would not otherwise qualify for enrollment. Issuance of 
temporary recognition does not constitute enrollment to practice or a 
finding of eligibility for enrollment, and the temporary recognition may 
be withdrawn at any time by the Director of Practice.
    (e) Appeal from denial of application. The Director of Practice must 
inform the applicant as to the reason(s) for any denial of an 
application for enrollment. The applicant may, within 30 days after 
receipt of the notice of denial of enrollment, file a written appeal of 
the denial of enrollment with the Secretary of the Treasury or his or 
her delegate. A decision on the appeal will be rendered by the Secretary 
of the Treasury, or his or her delegate, as soon as practicable.



Sec. 10.6  Enrollment.

    (a) Roster. The Director of Practice will maintain rosters of all 
individuals--
    (1) Who have been granted active enrollment to practice before the 
Internal Revenue Service;
    (2) Whose enrollment has been placed in inactive status for failure 
to meet the requirements for renewal of enrollment;
    (3) Whose enrollment has been placed in inactive retirement status;
    (4) Who have been censured, suspended, or disbarred from practice 
before the Internal Revenue Service;
    (5) Whose offer of consent to resign from enrollment to practice 
before the Internal Revenue Service has been accepted by the Director of 
Practice under Sec. 10.61; and
    (6) Whose application for enrollment has been denied.
    (b) Enrollment card. The Director of Practice will issue an 
enrollment card to each individual whose application for enrollment to 
practice before the Internal Revenue Service is approved after July 26, 
2002. Each enrollment card will be valid for the period stated on the 
enrollment card. An individual is not eligible to practice before the 
Internal Revenue Service if his or her enrollment card is not valid.
    (c) Term of enrollment. Each individual enrolled to practice before 
the Internal Revenue Service will be accorded active enrollment status 
subject to his or her renewal of enrollment as provided in this part.
    (d) Renewal of enrollment. To maintain active enrollment to practice 
before the Internal Revenue Service, each individual enrolled is 
required to have his or her enrollment renewed. Failure by an individual 
to receive notification from the Director of Practice of the renewal 
requirement will not be justification for the failure to satisfy this 
requirement.
    (1) All individuals licensed to practice before the Internal Revenue 
Service who have a social security number or tax identification number 
that ends with the numbers 0, 1, 2, or 3, except for those individuals 
who received their initial enrollment after November 1, 2003, must apply 
for renewal between November 1, 2003, and January 31, 2004. The renewal 
will be effective April 1, 2004.
    (2) All individuals licensed to practice before the Internal Revenue 
Service who have a social security number or tax identification number 
that ends with the numbers 4, 5, or 6, except for those individuals who 
received their initial enrollment after November 1, 2004, must apply for 
renewal between November 1, 2004, and January 31, 2005. The renewal will 
be effective April 1, 2005.
    (3) All individuals licensed to practice before the Internal Revenue 
Service who have a social security number or tax identification number 
that ends with the numbers 7, 8, or 9, except for those individuals who 
received their initial enrollment after November 1, 2005, must apply for 
renewal between

[[Page 159]]

November 1, 2005, and January 31, 2006. The renewal will be effective 
April 1, 2006.
    (4) Thereafter, applications for renewal will be required between 
November 1 and January 31 of every subsequent third year as specified in 
paragraph (d)(1), (2) or (3) of this section according to the last 
number of the individual's social security number or tax identification 
number. Those individuals who receive initial enrollment after November 
1 and before April 2 of the applicable renewal period will not be 
required to renew their enrollment before the first full renewal period 
following the receipt of their initial enrollment.
    (5) The Director of Practice will notify the individual of his or 
her renewal of enrollment and will issue the individual a card 
evidencing enrollment.
    (6) A reasonable nonrefundable fee may be charged for each 
application for renewal of enrollment filed with the Director of 
Practice.
    (7) Forms required for renewal may be obtained from the Director of 
Practice, Internal Revenue Service, 1111 Constitution Avenue, NW., 
Washington, DC 20224.
    (e) Condition for renewal: Continuing professional education. In 
order to qualify for renewal of enrollment, an individual enrolled to 
practice before the Internal Revenue Service must certify, on the 
application for renewal form prescribed by the Director of Practice, 
that he or she has satisfied the following continuing professional 
education requirements.
    (1) For renewed enrollment effective after March 31, 2004. (i) A 
minimum of 16 hours of continuing education credit must be completed 
during each calendar year in the enrollment term.
    (2) For renewed enrollment effective after April 1, 2007. (i) A 
minimum of 72 hours of continuing education credit must be completed 
during each three year period described in paragraph (d)(4) of this 
section. Each such three year period is known as an enrollment cycle.
    (ii) A minimum of 16 hours of continuing education credit, including 
2 hours of ethics or professional conduct, must be completed in each 
year of an enrollment cycle.
    (iii) An individual who receives initial enrollment during an 
enrollment cycle must complete two (2) hours of qualifying continuing 
education credit for each month enrolled during the enrollment cycle. 
Enrollment for any part of a month is considered enrollment for the 
entire month.
    (f) Qualifying continuing education--(1) General. To qualify for 
continuing education credit, a course of learning must--
    (i) Be a qualifying program designed to enhance professional 
knowledge in Federal taxation or Federal tax related matters, i.e., 
programs comprised of current subject matter in Federal taxation or 
Federal tax related matters, including accounting, tax preparation 
software and taxation or ethics; and
    (ii) Be conducted by a qualifying sponsor.
    (2) Qualifying programs--(i) Formal programs. A formal program 
qualifies as continuing education programs if it--
    (A) Requires attendance. Additionally, the program sponsor must 
provide each attendee with a certificate of attendance; and
    (B) Requires that the program be conducted by a qualified 
instructor, discussion leader, or speaker, i.e., a person whose 
background, training, education and experience is appropriate for 
instructing or leading a discussion on the subject matter of the 
particular program; and
    (C) Provides or requires a written outline, textbook, or suitable 
electronic educational materials.
    (ii) Correspondence or individual study programs (including taped 
programs). Qualifying continuing education programs include 
correspondence or individual study programs that are conducted by 
qualifying sponsors and completed on an individual basis by the enrolled 
individual. The allowable credit hours for such programs will be 
measured on a basis comparable to the measurement of a seminar or course 
for credit in an accredited educational institution. Such programs 
qualify as continuing education programs if they--
    (A) Require registration of the participants by the sponsor;

[[Page 160]]

    (B) Provide a means for measuring completion by the participants 
(e.g., a written examination), including the issuance of a certificate 
of completion by the sponsor; and
    (C) Provide a written outline, textbook, or suitable electronic 
educational materials.
    (iii) Serving as an instructor, discussion leader or speaker. (A) 
One hour of continuing education credit will be awarded for each contact 
hour completed as an instructor, discussion leader, or speaker at an 
educational program that meets the continuing education requirements of 
paragraph (f) of this section.
    (B) Two hours of continuing education credit will be awarded for 
actual subject preparation time for each contact hour completed as an 
instructor, discussion leader, or speaker at such programs. It is the 
responsibility of the individual claiming such credit to maintain 
records to verify preparation time.
    (C) The maximum credit for instruction and preparation may not 
exceed 50 percent of the continuing education requirement for an 
enrollment cycle.
    (D) An instructor, discussion leader, or speaker who makes more than 
one presentation on the same subject matter during an enrollment cycle, 
will receive continuing education credit for only one such presentation 
for the enrollment cycle.
    (iv) Credit for published articles, books, etc. (A) Continuing 
education credit will be awarded for publications on Federal taxation or 
Federal tax related matters, including accounting, financial management, 
tax preparation software, and taxation, provided the content of such 
publications is current and designed for the enhancement of the 
professional knowledge of an individual enrolled to practice before the 
Internal Revenue Service.
    (B) The credit allowed will be on the basis of one hour credit for 
each hour of preparation time for the material. It is the responsibility 
of the person claiming the credit to maintain records to verify 
preparation time.
    (C) The maximum credit for publications may not exceed 25 percent of 
the continuing education requirement of any enrollment cycle.
    (3) Periodic examination. (i) Individuals may establish eligibility 
for renewal of enrollment for any enrollment cycle by--
    (A) Achieving a passing score on each part of the Special Enrollment 
Examination administered under this part during the three year period 
prior to renewal; and
    (B) Completing a minimum of 16 hours of qualifying continuing 
education during the last year of an enrollment cycle.
    (ii) Courses designed to help an applicant prepare for the 
examination specified in paragraph (a) of Sec. 10.4 are considered 
basic in nature and are not qualifying continuing education.
    (g) Sponsors. (1) Sponsors are those responsible for presenting 
programs.
    (2) To qualify as a sponsor, a program presenter must--
    (i) Be an accredited educational institution;
    (ii) Be recognized for continuing education purposes by the 
licensing body of any State, territory, or possession of the United 
States, including a Commonwealth, or the District of Columbia.
    (iii) Be recognized by the Director of Practice as a professional 
organization or society whose programs include offering continuing 
professional education opportunities in subject matters within the scope 
of paragraph (f)(1)(i) of this section; or
    (iv) File a sponsor agreement with the Director of Practice and 
obtain approval of the program as a qualified continuing education 
program.
    (3) A qualifying sponsor must ensure the program complies with the 
following requirements--
    (i) Programs must be developed by individual(s) qualified in the 
subject matter;
    (ii) Program subject matter must be current;
    (iii) Instructors, discussion leaders, and speakers must be 
qualified with respect to program content;
    (iv) Programs must include some means for evaluation of technical 
content and presentation;
    (v) Certificates of completion must be provided to the participants 
who successfully complete the program; and

[[Page 161]]

    (vi) Records must be maintained by the sponsor to verify the 
participants who attended and completed the program for a period of 
three years following completion of the program. In the case of 
continuous conferences, conventions, and the like, records must be 
maintained to verify completion of the program and attendance by each 
participant at each segment of the program.
    (4) Professional organizations or societies wishing to be considered 
as qualified sponsors must request this status from the Director of 
Practice and furnish information in support of the request together with 
any further information deemed necessary by the Director of Practice.
    (5) A professional organization or society recognized as a qualified 
sponsor by the Director of Practice will retain its status for one 
enrollment cycle. The Director of Practice will publish the names of 
such sponsors on a periodic basis.
    (h) Measurement of continuing education coursework. (1) All 
continuing education programs will be measured in terms of contact 
hours. The shortest recognized program will be one contact hour.
    (2) A contact hour is 50 minutes of continuous participation in a 
program. Credit is granted only for a full contact hour, i.e., 50 
minutes or multiples thereof. For example, a program lasting more than 
50 minutes but less than 100 minutes will count as one contact hour.
    (3) Individual segments at continuous conferences, conventions and 
the like will be considered one total program. For example, two 90-
minute segments (180 minutes) at a continuous conference will count as 
three contact hours.
    (4) For university or college courses, each semester hour credit 
will equal 15 contact hours and a quarter hour credit will equal 10 
contact hours.
    (i) Recordkeeping requirements. (1) Each individual applying for 
renewal must retain for a period of three years following the date of 
renewal of enrollment the information required with regard to qualifying 
continuing professional education credit hours. Such information 
includes--
    (i) The name of the sponsoring organization;
    (ii) The location of the program;
    (iii) The title of the program and description of its content;
    (iv) Written outlines, course syllibi, textbook, and/or electronic 
materials provided or required for the course;
    (v) The dates attended;
    (vi) The credit hours claimed;
    (vii) The name(s) of the instructor(s), discussion leader(s), or 
speaker(s), if appropriate; and
    (viii) The certificate of completion and/or signed statement of the 
hours of attendance obtained from the sponsor.
    (2) To receive continuing education credit for service completed as 
an instructor, discussion leader, or speaker, the following information 
must be maintained for a period of three years following the date of 
renewal of enrollment--
    (i) The name of the sponsoring organization;
    (ii) The location of the program;
    (iii) The title of the program and description of its content;
    (iv) The dates of the program; and
    (v) The credit hours claimed.
    (3) To receive continuing education credit for publications, the 
following information must be maintained for a period of three years 
following the date of renewal of enrollment--
    (i) The publisher;
    (ii) The title of the publication;
    (iii) A copy of the publication;
    (iv) The date of publication; and
    (v) Records that substantiate the hours worked on the publication.
    (j) Waivers. (1) Waiver from the continuing education requirements 
for a given period may be granted by the Director of Practice for the 
following reasons--
    (i) Health, which prevented compliance with the continuing education 
requirements;
    (ii) Extended active military duty;
    (iii) Absence from the United States for an extended period of time 
due to employment or other reasons, provided the individual does not 
practice before the Internal Revenue Service during such absence; and
    (iv) Other compelling reasons, which will be considered on a case-
by-case basis.

[[Page 162]]

    (2) A request for waiver must be accompanied by appropriate 
documentation. The individual is required to furnish any additional 
documentation or explanation deemed necessary by the Director of 
Practice. Examples of appropriate documentation could be a medical 
certificate or military orders.
    (3) A request for waiver must be filed no later than the last day of 
the renewal application period.
    (4) If a request for waiver is not approved, the individual will be 
placed in inactive status, so notified by the Director of Practice, and 
placed on a roster of inactive enrolled individuals.
    (5) If a request for waiver is approved, the individual will be 
notified and issued a card evidencing renewal.
    (6) Those who are granted waivers are required to file timely 
applications for renewal of enrollment.
    (k) Failure to comply. (1) Compliance by an individual with the 
requirements of this part is determined by the Director of Practice. An 
individual who fails to meet the requirements of eligibility for renewal 
of enrollment will be notified by the Director of Practice at his or her 
enrollment address by first class mail. The notice will state the basis 
for the determination of noncompliance and will provide the individual 
an opportunity to furnish information in writing relating to the matter 
within 60 days of the date of the notice. Such information will be 
considered by the Director of Practice in making a final determination 
as to eligibility for renewal of enrollment.
    (2) The Director of Practice may require any individual, by notice 
sent by first class mail to his or her enrollment address, to provide 
copies of any records required to be maintained under this part. The 
Director of Practice may disallow any continuing professional education 
hours claimed if the individual fails to comply with this requirement.
    (3) An individual who has not filed a timely application for renewal 
of enrollment, who has not made a timely response to the notice of 
noncompliance with the renewal requirements, or who has not satisfied 
the requirements of eligibility for renewal will be placed on a roster 
of inactive enrolled individuals. During this time, the individual will 
be ineligible to practice before the Internal Revenue Service.
    (4) Individuals placed in inactive enrollment status and individuals 
ineligible to practice before the Internal Revenue Service may not state 
or imply that they are enrolled to practice before the Internal Revenue 
Service, or use the term enrolled agent, the designation ``E. A.,'' or 
other form of reference to eligibility to practice before the Internal 
Revenue Service.
    (5) An individual placed in an inactive status may be reinstated to 
an active enrollment status by filing an application for renewal of 
enrollment and providing evidence of the completion of all required 
continuing professional education hours for the enrollment cycle. 
Continuing education credit under this paragraph (k)(5) may not be used 
to satisfy the requirements of the enrollment cycle in which the 
individual has been placed back on the active roster.
    (6) An individual placed in an inactive status must file an 
application for renewal of enrollment and satisfy the requirements for 
renewal as set forth in this section within three years of being placed 
in an inactive status. The name of such individual otherwise will be 
removed from the inactive enrollment roster and his or her enrollment 
will terminate. Eligibility for enrollment must then be reestablished by 
the individual as provided in this section.
    (7) Inactive enrollment status is not available to an individual who 
is the subject of a disciplinary matter in the Office of Director of 
Practice.
    (l) Inactive retirement status. An individual who no longer 
practices before the Internal Revenue Service may request being placed 
in an inactive status at any time and such individual will be placed in 
an inactive retirement status. The individual will be ineligible to 
practice before the Internal Revenue Service. Such individual must file 
a timely application for renewal of enrollment at each applicable 
renewal or enrollment period as provided in this section. An individual 
who is placed in an inactive retirement status may be reinstated to an 
active enrollment status by filing an application for renewal of 
enrollment and providing evidence

[[Page 163]]

of the completion of the required continuing professional education 
hours for the enrollment cycle. Inactive retirement status is not 
available to an individual who is subject of a disciplinary matter in 
the Office of Director of Practice.
    (m) Renewal while under suspension or disbarment. An individual who 
is ineligible to practice before the Internal Revenue Service by virtue 
of disciplinary action is required to be in conformance with the 
requirements for renewal of enrollment before his or her eligibility is 
restored.
    (n) Verification. The Director of Practice may review the continuing 
education records of an enrolled individual and/or qualified sponsor in 
a manner deemed appropriate to determine compliance with the 
requirements and standards for renewal of enrollment as provided in 
paragraph (f) of this section.
    (o) Enrolled actuaries. The enrollment and the renewal of enrollment 
of actuaries authorized to practice under paragraph (d) of Sec. 10.3 
are governed by the regulations of the Joint Board for the Enrollment of 
Actuaries at 20 CFR 901.1 through 901.71.

(Approved by the Office of Management and Budget under Control No. 1545-
0946 and 1545-1726)



Sec. 10.7  Representing oneself; participating in rulemaking; limited 
practice; special appearances; and return preparation.

    (a) Representing oneself. Individuals may appear on their own behalf 
before the Internal Revenue Service provided they present satisfactory 
identification.
    (b) Participating in rulemaking. Individuals may participate in 
rulemaking as provided by the Administrative Procedure Act. See 5 U.S.C. 
553.
    (c) Limited practice--(1) In general. Subject to the limitations in 
paragraph (c)(2) of this section, an individual who is not a 
practitioner may represent a taxpayer before the Internal Revenue 
Service in the circumstances described in this paragraph (c)(1), even if 
the taxpayer is not present, provided the individual presents 
satisfactory identification and proof of his or her authority to 
represent the taxpayer. The circumstances described in this paragraph 
(c)(1) are as follows:
    (i) An individual may represent a member of his or her immediate 
family.
    (ii) A regular full-time employee of an individual employer may 
represent the employer.
    (iii) A general partner or a regular full-time employee of a 
partnership may represent the partnership.
    (iv) A bona fide officer or a regular full-time employee of a 
corporation (including a parent, subsidiary, or other affiliated 
corporation), association, or organized group may represent the 
corporation, association, or organized group.
    (v) A regular full-time employee of a trust, receivership, 
guardianship, or estate may represent the trust, receivership, 
guardianship, or estate.
    (vi) An officer or a regular employee of a governmental unit, 
agency, or authority may represent the governmental unit, agency, or 
authority in the course of his or her official duties.
    (vii) An individual may represent any individual or entity, who is 
outside the United States, before personnel of the Internal Revenue 
Service when such representation takes place outside the United States.
    (viii) An individual who prepares and signs a taxpayer's tax return 
as the preparer, or who prepares a tax return but is not required (by 
the instructions to the tax return or regulations) to sign the tax 
return, may represent the taxpayer before revenue agents, customer 
service representatives or similar officers and employees of the 
Internal Revenue Service during an examination of the taxable year or 
period covered by that tax return, but, unless otherwise prescribed by 
regulation or notice, this right does not permit such individual to 
represent the taxpayer, regardless of the circumstances requiring 
representation, before appeals officers, revenue officers, Counsel or 
similar officers or employees of the Internal Revenue Service or the 
Department of Treasury.
    (2) Limitations. (i) An individual who is under suspension or 
disbarment from practice before the Internal Revenue Service may not 
engage in limited practice before the Internal Revenue

[[Page 164]]

Service under paragraph (c)(1) of this section.
    (ii) The Director, after notice and opportunity for a conference, 
may deny eligibility to engage in limited practice before the Internal 
Revenue Service under paragraph (c)(1) of this section to any individual 
who has engaged in conduct that would justify censuring, suspending, or 
disbarring a practitioner from practice before the Internal Revenue 
Service.
    (iii) An individual who represents a taxpayer under the authority of 
paragraph (c)(1) of this section is subject, to the extent of his or her 
authority, to such rules of general applicability regarding standards of 
conduct and other matters as the Director of Practice prescribes.
    (d) Special appearances. The Director of Practice may, subject to 
such conditions as he or she deems appropriate, authorize an individual 
who is not otherwise eligible to practice before the Internal Revenue 
Service to represent another person in a particular matter.
    (e) Preparing tax returns and furnishing information. Any individual 
may prepare a tax return, appear as a witness for the taxpayer before 
the Internal Revenue Service, or furnish information at the request of 
the Internal Revenue Service or any of its officers or employees.
    (f) Fiduciaries. For purposes of this part, a fiduciary (i.e., a 
trustee, receiver, guardian, personal representative, administrator, or 
executor) is considered to be the taxpayer and not a representative of 
the taxpayer.



Sec. 10.8  Customhouse brokers.

    Nothing contained in the regulations in this part will affect or 
limit the right of a customhouse broker, licensed as such by the 
Commissioner of Customs in accordance with the regulations prescribed 
therefor, in any customs district in which he or she is so licensed, at 
a relevant local office of the Internal Revenue Service or before the 
National Office of the Internal Revenue Service, to act as a 
representative in respect to any matters relating specifically to the 
importation or exportation of merchandise under the customs or internal 
revenue laws, for any person for whom he or she has acted as a 
customhouse broker.



   Subpart B_Duties and Restrictions Relating to Practice Before the 
                        Internal Revenue Service

    Source: T.D. 9011, 67 FR 48771, July 26, 2002, unless otherwise 
noted.



Sec. 10.20  Information to be furnished.

    (a) To the Internal Revenue Service. (1) A practitioner must, on a 
proper and lawful request by a duly authorized officer or employee of 
the Internal Revenue Service, promptly submit records or information in 
any matter before the Internal Revenue Service unless the practitioner 
believes in good faith and on reasonable grounds that the records or 
information are privileged.
    (2) Where the requested records or information are not in the 
possession of, or subject to the control of, the practitioner or the 
practitioner's client, the practitioner must promptly notify the 
requesting Internal Revenue Service officer or employee and the 
practitioner must provide any information that the practitioner has 
regarding the identity of any person who the practitioner believes may 
have possession or control of the requested records or information. The 
practitioner must make reasonable inquiry of his or her client regarding 
the identity of any person who may have possession or control of the 
requested records or information, but the practitioner is not required 
to make inquiry of any other person or independently verify any 
information provided by the practitioner's client regarding the identity 
of such persons.
    (b) To the Director of Practice. When a proper and lawful request is 
made by the Director of Practice, a practitioner must provide the 
Director of Practice with any information the practitioner has 
concerning an inquiry by the Director of Practice into an alleged 
violation of the regulations in this part by any person, and to testify 
regarding this information in any proceeding instituted under this part, 
unless the practitioner believes in good faith and on reasonable grounds 
that the information is privileged.
    (c) Interference with a proper and lawful request for records or 
information. A

[[Page 165]]

practitioner may not interfere, or attempt to interfere, with any proper 
and lawful effort by the Internal Revenue Service, its officers or 
employees, or the Director of Practice, or his or her employees, to 
obtain any record or information unless the practitioner believes in 
good faith and on reasonable grounds that the record or information is 
privileged.



Sec. 10.21  Knowledge of client's omission.

    A practitioner who, having been retained by a client with respect to 
a matter administered by the Internal Revenue Service, knows that the 
client has not complied with the revenue laws of the United States or 
has made an error in or omission from any return, document, affidavit, 
or other paper which the client submitted or executed under the revenue 
laws of the United States, must advise the client promptly of the fact 
of such noncompliance, error, or omission. The practitioner must advise 
the client of the consequences as provided under the Code and 
regulations of such noncompliance, error, or omission.



Sec. 10.22  Diligence as to accuracy.

    (a) In general. A practitioner must exercise due diligence--
    (1) In preparing or assisting in the preparation of, approving, and 
filing tax returns, documents, affidavits, and other papers relating to 
Internal Revenue Service matters;
    (2) In determining the correctness of oral or written 
representations made by the practitioner to the Department of the 
Treasury; and
    (3) In determining the correctness of oral or written 
representations made by the practitioner to clients with reference to 
any matter administered by the Internal Revenue Service.
    (b) Reliance on others. Except as provided in Sec. Sec. 10.33 and 
10.34, a practitioner will be presumed to have exercised due diligence 
for purposes of this section if the practitioner relies on the work 
product of another person and the practitioner used reasonable care in 
engaging, supervising, training, and evaluating the person, taking 
proper account of the nature of the relationship between the 
practitioner and the person.



Sec. 10.23  Prompt disposition of pending matters.

    A practitioner may not unreasonably delay the prompt disposition of 
any matter before the Internal Revenue Service.



Sec. 10.24  Assistance from or to disbarred or suspended persons and 
former Internal Revenue Service employees.

    A practitioner may not, knowingly and directly or indirectly:
    (a) Accept assistance from or assist any person who is under 
disbarment or suspension from practice before the Internal Revenue 
Service if the assistance relates to a matter or matters constituting 
practice before the Internal Revenue Service.
    (b) Accept assistance from any former government employee where the 
provisions of Sec. 10.25 or any Federal law would be violated.



Sec. 10.25  Practice by former Government employees, their partners 
and their associates.

    (a) Definitions. For purposes of this section--
    (1) Assist means to act in such a way as to advise, furnish 
information to, or otherwise aid another person, directly or indirectly.
    (2) Government employee is an officer or employee of the United 
States or any agency of the United States, including a special 
government employee as defined in 18 U.S.C. 202(a), or of the District 
of Columbia, or of any State, or a member of Congress or of any State 
legislature.
    (3) Member of a firm is a sole practitioner or an employee or 
associate thereof, or a partner, stockholder, associate, affiliate or 
employee of a partnership, joint venture, corporation, professional 
association or other affiliation of two or more practitioners who 
represent nongovernmental parties.
    (4) Practitioner includes any individual described in paragraph (f) 
of Sec. 10.2.
    (5) Official responsibility means the direct administrative or 
operating authority, whether intermediate or final, and either 
exercisable alone or with others, and either personally or

[[Page 166]]

through subordinates, to approve, disapprove, or otherwise direct 
Government action, with or without knowledge of the action.
    (6) Participate or participation means substantial involvement as a 
Government employee by making decisions, or preparing or reviewing 
documents with or without the right to exercise a judgment of approval 
or disapproval, or participating in conferences or investigations, or 
rendering advice of a substantial nature.
    (7) Rule includes Treasury Regulations, whether issued or under 
preparation for issuance as Notices of Proposed Rule Making or as 
Treasury Decisions; revenue rulings; and revenue procedures published in 
the Internal Revenue Bulletin. Rule does not include a transaction as 
defined in paragraph (a)(8) of this section.
    (8) Transaction means any decision, determination, finding, letter 
ruling, technical advice, Chief Counsel advice, or contract or the 
approval or disapproval thereof, relating to a particular factual 
situation or situations involving a specific party or parties whose 
rights, privileges, or liabilities under laws or regulations 
administered by the Internal Revenue Service, or other legal rights, are 
determined or immediately affected therein and to which the United 
States is a party or in which it has a direct and substantial interest, 
whether or not the same taxable periods are involved. Transaction does 
not include rule as defined in paragraph (a)(7) of this section.
    (b) General rules. (1) No former Government employee may, subsequent 
to his or her Government employment, represent anyone in any matter 
administered by the Internal Revenue Service if the representation would 
violate 18 U.S.C. 207 or any other laws of the United States.
    (2) No former Government employee who participated in a transaction 
may, subsequent to his or her Government employment, represent or 
knowingly assist, in that transaction, any person who is or was a 
specific party to that transaction.
    (3) A former Government employee who within a period of one year 
prior to the termination of Government employment had official 
responsibility for a transaction may not, within two years after his or 
her Government employment is ended, represent or knowingly assist in 
that transaction any person who is or was a specific party to that 
transaction.
    (4) No former Government employee may, within one year after his or 
her Government employment is ended, appear before any employee of the 
Treasury Department in connection with the publication, withdrawal, 
amendment, modification, or interpretation of a rule in the development 
of which the former Government employee participated or for which, 
within a period of one year prior to the termination of his or her 
Government employment, he or she had official responsibility. This 
paragraph (b)(4) does not, however, preclude such former employee from 
appearing on his or her own behalf or from representing a taxpayer 
before the Internal Revenue Service in connection with a transaction 
involving the application or interpretation of such a rule with respect 
to that transaction, provided that such former employee does not utilize 
or disclose any confidential information acquired by the former employee 
in the development of the rule.
    (c) Firm representation. (1) No member of a firm of which a former 
Government employee is a member may represent or knowingly assist a 
person who was or is a specific party in any transaction with respect to 
which the restrictions of paragraph (b)(2) or (3) of this section apply 
to the former Government employee, in that transaction, unless the firm 
isolates the former Government employee in such a way to ensure that the 
former Government employee cannot assist in the representation.
    (2) When isolation of a former Government employee is required under 
paragraph (c)(1) of this section, a statement affirming the fact of such 
isolation must be executed under oath by the former Government employee 
and by another member of the firm acting on behalf of the firm. The 
statement must clearly identify the firm, the former Government 
employee, and the transaction(s) requiring isolation and it must be 
filed with the Director of

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Practice (and at such other place(s) directed by the Director of 
Practice) and in such other place and in the manner prescribed by rule 
or regulation.
    (d) Pending representation. Practice by former Government employees, 
their partners and associates with respect to representation in pecific 
matters where actual representation commenced before July 26, 2002 is 
governed by the regulations set forth at 31 CFR part 10 revised as of 
July 1, 2002. The burden of showing that representation commenced before 
July 26, 2002 lies with the former Government employees, and their 
partners and associates.



Sec. 10.26  Notaries.

    A practitioner may not take acknowledgments, administer oaths, 
certify papers, or perform any official act as a notary public with 
respect to any matter administered by the Internal Revenue Service and 
for which he or she is employed as counsel, attorney, or agent, or in 
which he or she may be in any way interested.



Sec. 10.27  Fees.

    (a) Generally. A practitioner may not charge an unconscionable fee 
for representing a client in a matter before the Internal Revenue 
Service.
    (b) Contingent fees. (1) For purposes of this section, a contingent 
fee is any fee that is based, in whole or in part, on whether or not a 
position taken on a tax return or other filing avoids challenge by the 
Internal Revenue Service or is sustained either by the Internal Revenue 
Service or in litigation. A contingent fee includes any fee arrangement 
in which the practitioner will reimburse the client for all or a portion 
of the client's fee in the event that a position taken on a tax return 
or other filing is challenged by the Internal Revenue Service or is not 
sustained, whether pursuant to an indemnity agreement, a guarantee, 
rescission rights, or any other arrangement with a similar effect.
    (2) A practitioner may not charge a contingent fee for preparing an 
original tax return or for any advice rendered in connection with a 
position taken or to be taken on an original tax return.
    (3) A contingent fee may be charged for preparation of or advice in 
connection with an amended tax return or a claim for refund (other than 
a claim for refund made on an original tax return), but only if the 
practitioner reasonably anticipates at the time the fee arrangement is 
entered into that the amended tax return or refund claim will receive 
substantive review by the Internal Revenue Service.



Sec. 10.28  Return of client's records.

    (a) In general, a practitioner must, at the request of a client, 
promptly return any and all records of the client that are necessary for 
the client to comply with his or her Federal tax obligations. The 
practitioner may retain copies of the records returned to a client. The 
existence of a dispute over fees generally does not relieve the 
practitioner of his or her responsibility under this section. 
Nevertheless, if applicable state law allows or permits the retention of 
a client's records by a practitioner in the case of a dispute over fees 
for services rendered, the practitioner need only return those records 
that must be attached to the taxpayer's return. The practitioner, 
however, must provide the client with reasonable access to review and 
copy any additional records of the client retained by the practitioner 
under state law that are necessary for the client to comply with his or 
her Federal tax obligations.
    (b) For purposes of this section, Records of the client include all 
documents or written or electronic materials provided to the 
practitioner, or obtained by the practitioner in the course of the 
practitioner's representation of the client, that preexisted the 
retention of the practitioner by the client. The term also includes 
materials that were prepared by the client or a third party (not 
including an employee or agent of the practitioner) at any time and 
provided to the practitioner with respect to the subject matter of the 
representation. The term also includes any return, claim for refund, 
schedule, affidavit, appraisal or any other document prepared by the 
practitioner, or his or her employee or agent, that was presented to the 
client with respect to a prior representation if such document is 
necessary for the taxpayer to comply with his or her current Federal tax 
obligations. The term

[[Page 168]]

does not include any return, claim for refund, schedule, affidavit, 
appraisal or any other document prepared by the practitioner or the 
practitioner's firm, employees or agents if the practitioner is 
withholding such document pending the client's performance of its 
contractual obligation to pay fees with respect to such document.



Sec. 10.29  Conflicting interests.

    (a) Except as provided by paragraph (b) of this section, a 
practitioner shall not represent a client in his or her practice before 
the Internal Revenue Service if the representation involves a conflict 
of interest. A conflict of interest exists if:
    (1) The representation of one client will be directly adverse to 
another client; or
    (2) There is a significant risk that the representation of one or 
more clients will be materially limited by the practitioner's 
responsibilities to another client, a former client or a third person or 
by a personal interest of the practitioner.
    (b) Notwithstanding the existence of a conflict of interest under 
paragraph (a) of this section, the practitioner may represent a client 
if:
    (1) The practitioner reasonably believes that the practitioner will 
be able to provide competent and diligent representation to each 
affected client;
    (2) The representation is not prohibited by law;
    (3) Each affected client gives informed consent, confirmed in 
writing.
    (c) Copies of the written consents must be retained by the 
practitioner for at least 36 months from the date of the conclusion of 
the representation of the affected clients and the written consents must 
be provided to any officer or employee of the Internal Revenue Service 
on request. y

(Approved by the Office of Management and Budget under Control No. 1545-
1726)



Sec. 10.30  Solicitation.

    (a) Advertising and solicitation restrictions. (1) A practitioner 
may not, with respect to any Internal Revenue Service matter, in any way 
use or participate in the use of any form of public communication or 
private solicitation containing a false, fraudulent, or coercive 
statement or claim; or a misleading or deceptive statement or claim. 
Enrolled agents, in describing their professional designation, may not 
utilize the term of art ``certified'' or imply an employer/employee 
relationship with the Internal Revenue Service. Examples of acceptable 
descriptions are ``enrolled to represent taxpayers before the Internal 
Revenue Service,'' ``enrolled to practice before the Internal Revenue 
Service,'' and ``admitted to practice before the Internal Revenue 
Service.''
    (2) A practitioner may not make, directly or indirectly, an 
uninvited written or oral solicitation of employment in matters related 
to the Internal Revenue Service if the solicitation violates Federal or 
State law or other applicable rule, e.g., attorneys are precluded from 
making a solicitation that is prohibited by conduct rules applicable to 
all attorneys in their State(s) of licensure. Any lawful solicitation 
made by or on behalf of a practitioner eligible to practice before the 
Internal Revenue Service must, nevertheless, clearly identify the 
solicitation as such and, if applicable, identify the source of the 
information used in choosing the recipient.
    (b) Fee information. (1)(i) A practitioner may publish the 
availability of a written schedule of fees and disseminate the following 
fee information--
    (A) Fixed fees for specific routine services.
    (B) Hourly rates.
    (C) Range of fees for particular services.
    (D) Fee charged for an initial consultation.
    (ii) Any statement of fee information concerning matters in which 
costs may be incurred must include a statement disclosing whether 
clients will be responsible for such costs.
    (2) A practitioner may charge no more than the rate(s) published 
under paragraph (b)(1) of this section for at least 30 calendar days 
after the last date on which the schedule of fees was published.
    (c) Communication of fee information. Fee information may be 
communicated in professional lists, telephone directories, print media, 
mailings, electronic mail, facsimile, hand delivered

[[Page 169]]

flyers, radio, television, and any other method. The method chosen, 
however, must not cause the communication to become untruthful, 
deceptive, or otherwise in violation of this part. A practitioner may 
not persist in attempting to contact a prospective client if the 
prospective client has made it known to the practitioner that he or she 
does not desire to be solicited. In the case of radio and television 
broadcasting, the broadcast must be recorded and the practitioner must 
retain a recording of the actual transmission. In the case of direct 
mail and e-commerce communications, the practitioner must retain a copy 
of the actual communication, along with a list or other description of 
persons to whom the communication was mailed or otherwise distributed. 
The copy must be retained by the practitioner for a period of at least 
36 months from the date of the last transmission or use.
    (d) Improper associations. A practitioner may not, in matters 
related to the Internal Revenue Service, assist, or accept assistance 
from, any person or entity who, to the knowledge of the practitioner, 
obtains clients or otherwise practices in a manner forbidden under this 
section.

(Approved by the Office of Management and Budget under Control No. 1545-
1726)



Sec. 10.31  Negotiation of taxpayer checks.

    A practitioner who prepares tax returns may not endorse or otherwise 
negotiate any check issued to a client by the government in respect of a 
Federal tax liability.



Sec. 10.32  Practice of law.

    Nothing in the regulations in this part may be construed as 
authorizing persons not members of the bar to practice law.



Sec. 10.33  Best practices for tax advisors.

    (a) Best practices. Tax advisors should provide clients with the 
highest quality representation concerning Federal tax issues by adhering 
to best practices in providing advice and in preparing or assisting in 
the preparation of a submission to the Internal Revenue Service. In 
addition to compliance with the standards of practice provided elsewhere 
in this part, best practices include the following:
    (1) Communicating clearly with the client regarding the terms of the 
engagement. For example, the advisor should determine the client's 
expected purpose for and use of the advice and should have a clear 
understanding with the client regarding the form and scope of the advice 
or assistance to be rendered.
    (2) Establishing the facts, determining which facts are relevant, 
evaluating the reasonableness of any assumptions or representations, 
relating the applicable law (including potentially applicable judicial 
doctrines) to the relevant facts, and arriving at a conclusion supported 
by the law and the facts.
    (3) Advising the client regarding the import of the conclusions 
reached, including, for example, whether a taxpayer may avoid accuracy-
related penalties under the Internal Revenue Code if a taxpayer acts in 
reliance on the advice.
    (4) Acting fairly and with integrity in practice before the Internal 
Revenue Service.
    (b) Procedures to ensure best practices for tax advisors. Tax 
advisors with responsibility for overseeing a firm's practice of 
providing advice concerning Federal tax issues or of preparing or 
assisting in the preparation of submissions to the Internal Revenue 
Service should take reasonable steps to ensure that the firm's 
procedures for all members, associates, and employees are consistent 
with the best practices set forth in paragraph (a) of this section.
    (c) Applicability date. This section is effective after June 20, 
2005.

[T.D. 9011, 67 FR 48771, July 26, 2002, as amended by T.D. 9165, 69 FR 
75841, Dec. 20, 2004]



Sec. 10.34  Standards for advising with respect to tax return positions 
and for preparing or signing returns.

    (a) Realistic possibility standard. A practitioner may not sign a 
tax return as a preparer if the practitioner determines that the tax 
return contains a position that does not have a realistic possibility of 
being sustained on its merits (the realistic possibility standard) 
unless the position is not frivolous

[[Page 170]]

and is adequately disclosed to the Internal Revenue Service. A 
practitioner may not advise a client to take a position on a tax return, 
or prepare the portion of a tax return on which a position is taken, 
unless--
    (1) The practitioner determines that the position satisfies the 
realistic possibility standard; or
    (2) The position is not frivolous and the practitioner advises the 
client of any opportunity to avoid the accuracy-related penalty in 
section 6662 of the Internal Revenue Code by adequately disclosing the 
position and of the requirements for adequate disclosure.
    (b) Advising clients on potential penalties. A practitioner advising 
a client to take a position on a tax return, or preparing or signing a 
tax return as a preparer, must inform the client of the penalties 
reasonably likely to apply to the client with respect to the position 
advised, prepared, or reported. The practitioner also must inform the 
client of any opportunity to avoid any such penalty by disclosure, if 
relevant, and of the requirements for adequate disclosure. This 
paragraph (b) applies even if the practitioner is not subject to a 
penalty with respect to the position.
    (c) Relying on information furnished by clients. A practitioner 
advising a client to take a position on a tax return, or preparing or 
signing a tax return as a preparer, generally may rely in good faith 
without verification upon information furnished by the client. The 
practitioner may not, however, ignore the implications of information 
furnished to, or actually known by, the practitioner, and must make 
reasonable inquiries if the information as furnished appears to be 
incorrect, inconsistent with an important fact or another factual 
assumption, or incomplete.
    (d) Definitions. For purposes of this section--
    (1) Realistic possibility. A position is considered to have a 
realistic possibility of being sustained on its merits if a reasonable 
and well informed analysis of the law and the facts by a person 
knowledgeable in the tax law would lead such a person to conclude that 
the position has approximately a one in three, or greater, likelihood of 
being sustained on its merits. The authorities described in 26 CFR 
1.6662-4(d)(3)(iii), or any successor provision, of the substantial 
understatement penalty regulations may be taken into account for 
purposes of this analysis. The possibility that a tax return will not be 
audited, that an issue will not be raised on audit, or that an issue 
will be settled may not be taken into account.
    (2) Frivolous. A position is frivolous if it is patently improper.



Sec. 10.35  Requirements for covered opinions.

    (a) A practitioner who provides a covered opinion shall comply with 
the standards of practice in this section.
    (b) Definitions. For purposes of this subpart--
    (1) A practitioner includes any individual described in Sec. 
10.2(e).
    (2) Covered opinion--(i) In general. A covered opinion is written 
advice (including electronic communications) by a practitioner 
concerning one or more Federal tax issues arising from--
    (A) A transaction that is the same as or substantially similar to a 
transaction that, at the time the advice is rendered, the Internal 
Revenue Service has determined to be a tax avoidance transaction and 
identified by published guidance as a listed transaction under 26 CFR 
1.6011-4(b)(2);
    (B) Any partnership or other entity, any investment plan or 
arrangement, or any other plan or arrangement, the principal purpose of 
which is the avoidance or evasion of any tax imposed by the Internal 
Revenue Code; or
    (C) Any partnership or other entity, any investment plan or 
arrangement, or any other plan or arrangement, a significant purpose of 
which is the avoidance or evasion of any tax imposed by the Internal 
Revenue Code if the written advice--
    (1) Is a reliance opinion;
    (2) Is a marketed opinion;
    (3) Is subject to conditions of confidentiality; or
    (4) Is subject to contractual protection.
    (ii) Excluded advice. A covered opinion does not include--
    (A) Written advice provided to a client during the course of an 
engagement if a practitioner is reasonably expected to provide 
subsequent written advice to

[[Page 171]]

the client that satisfies the requirements of this section;
    (B) Written advice, other than advice described in paragraph 
(b)(2)(i)(A) of this section (concerning listed transactions) or 
paragraph (b)(2)(ii)(B) of this section (concerning the principal 
purpose of avoidance or evasion) that--
    (1) Concerns the qualification of a qualified plan;
    (2) Is a State or local bond opinion; or
    (3) Is included in documents required to be filed with the 
Securities and Exchange Commission;
    (C) Written advice prepared for and provided to a taxpayer, solely 
for use by that taxpayer, after the taxpayer has filed a tax return with 
the Internal Revenue Service reflecting the tax benefits of the 
transaction. The preceding sentence does not apply if the practitioner 
knows or has reason to know that the written advice will be relied upon 
by the taxpayer to take a position on a tax return (including for these 
purposes an amended return that claims tax benefits not reported on a 
previously filed return) filed after the date on which the advice is 
provided to the taxpayer;
    (D) Written advice provided to an employer by a practitioner in that 
practitioner's capacity as an employee of that employer solely for 
purposes of determining the tax liability of the employer; or
    (E) Written advice that does not resolve a Federal tax issue in the 
taxpayer's favor, unless the advice reaches a conclusion favorable to 
the taxpayer at any confidence level (e.g., not frivolous, realistic 
possibility of success, reasonable basis or substantial authority) with 
respect to that issue. If written advice concerns more than one Federal 
tax issue, the advice must comply with the requirements of paragraph (c) 
of this section with respect to any Federal tax issue not described in 
the preceding sentence.
    (3) A Federal tax issue is a question concerning the Federal tax 
treatment of an item of income, gain, loss, deduction, or credit, the 
existence or absence of a taxable transfer of property, or the value of 
property for Federal tax purposes. For purposes of this subpart, a 
Federal tax issue is significant if the Internal Revenue Service has a 
reasonable basis for a successful challenge and its resolution could 
have a significant impact, whether beneficial or adverse and under any 
reasonably foreseeable circumstance, on the overall Federal tax 
treatment of the transaction(s) or matter(s) addressed in the opinion.
    (4) Reliance opinion--(i) Written advice is a reliance opinion if 
the advice concludes at a confidence level of at least more likely than 
not (a greater than 50 percent likelihood) that one or more significant 
Federal tax issues would be resolved in the taxpayer's favor.
    (ii) For purposes of this section, written advice, other than advice 
described in paragraph (b)(2)(i)(A) of this section (concerning listed 
transactions) or paragraph (b)(2)(i)(B) of this section (concerning the 
principal purpose of avoidance or evasion), is not treated as a reliance 
opinion if the practitioner prominently discloses in the written advice 
that it was not intended or written by the practitioner to be used, and 
that it cannot be used by the taxpayer, for the purpose of avoiding 
penalties that may be imposed on the taxpayer.
    (5) Marketed opinion--(i) Written advice is a marketed opinion if 
the practitioner knows or has reason to know that the written advice 
will be used or referred to by a person other than the practitioner (or 
a person who is a member of, associated with, or employed by the 
practitioner's firm) in promoting, marketing or recommending a 
partnership or other entity, investment plan or arrangement to one or 
more taxpayer(s).
    (ii) For purposes of this section, written advice, other than advice 
described in paragraph (b)(2)(i)(A) of this section (concerning listed 
transactions) or paragraph (b)(2)(i)(B) of this section (concerning the 
principal purpose of avoidance or evasion), is not treated as a marketed 
opinion if the practitioner prominently discloses in the written advice 
that--
    (A) The advice was not intended or written by the practitioner to be 
used, and that it cannot be used by any taxpayer, for the purpose of 
avoiding penalties that may be imposed on the taxpayer;

[[Page 172]]

    (B) The advice was written to support the promotion or marketing of 
the transaction(s) or matter(s) addressed by the written advice; and
    (C) The taxpayer should seek advice based on the taxpayer's 
particular circumstances from an independent tax advisor.
    (6) Conditions of confidentiality. Written advice is subject to 
conditions of confidentiality if the practitioner imposes on one or more 
recipients of the written advice a limitation on disclosure of the tax 
treatment or tax structure of the transaction and the limitation on 
disclosure protects the confidentiality of that practitioner's tax 
strategies, regardless of whether the limitation on disclosure is 
legally binding. A claim that a transaction is proprietary or exclusive 
is not a limitation on disclosure if the practitioner confirms to all 
recipients of the written advice that there is no limitation on 
disclosure of the tax treatment or tax structure of the transaction that 
is the subject of the written advice.
    (7) Contractual protection. Written advice is subject to contractual 
protection if the taxpayer has the right to a full or partial refund of 
fees paid to the practitioner (or a person who is a member of, 
associated with, or employed by the practitioner's firm) if all or a 
part of the intended tax consequences from the matters addressed in the 
written advice are not sustained, or if the fees paid to the 
practitioner (or a person who is a member of, associated with, or 
employed by the practitioner's firm) are contingent on the taxpayer's 
realization of tax benefits from the transaction. All the facts and 
circumstances relating to the matters addressed in the written advice 
will be considered when determining whether a fee is refundable or 
contingent, including the right to reimbursements of amounts that the 
parties to a transaction have not designated as fees or any agreement to 
provide services without reasonable compensation.
    (8) Prominently disclosed. An item is prominently disclosed if it is 
readily apparent to a reader of the written advice. Whether an item is 
readily apparent will depend on the facts and circumstances surrounding 
the written advice including, but not limited to, the sophistication of 
the taxpayer and the length of the written advice. At a minimum, to be 
prominently disclosed an item must be set forth in a separate section 
(and not in a footnote) in a typeface that is the same size or larger 
than the typeface of any discussion of the facts or law in the written 
advice.
    (9) State or local bond opinion. A State or local bond opinion is 
written advice with respect to a Federal tax issue included in any 
materials delivered to a purchaser of a State or local bond in 
connection with the issuance of the bond in a public or private 
offering, including an official statement (if one is prepared), that 
concerns only the excludability of interest on a State or local bond 
from gross income under section 103 of the Internal Revenue Code, the 
application of section 55 of the Internal Revenue Code to a State or 
local bond, the status of a State or local bond as a qualified tax-
exempt obligation under section 265(b)(3) of the Internal Revenue Code, 
the status of a State or local bond as a qualified zone academy bond 
under section 1397E of the Internal Revenue Code, or any combination of 
the above.
    (10) The principal purpose. For purposes of this section, the 
principal purpose of a partnership or other entity, investment plan or 
arrangement, or other plan or arrangement is the avoidance or evasion of 
any tax imposed by the Internal Revenue Code if that purpose exceeds any 
other purpose. The principal purpose of a partnership or other entity, 
investment plan or arrangement, or other plan or arrangement is not to 
avoid or evade Federal tax if that partnership, entity, plan or 
arrangement has as its purpose the claiming of tax benefits in a manner 
consistent with the statute and Congressional purpose. A partnership, 
entity, plan or arrangement may have a significant purpose of avoidance 
or evasion even though it does not have the principal purpose of 
avoidance or evasion under this paragraph (b)(10).
    (c) Requirements for covered opinions. A practitioner providing a 
covered opinion must comply with each of the following requirements.
    (1) Factual matters. (i) The practitioner must use reasonable 
efforts to identify and ascertain the facts, which

[[Page 173]]

may relate to future events if a transaction is prospective or proposed, 
and to determine which facts are relevant. The opinion must identify and 
consider all facts that the practitioner determines to be relevant.
    (ii) The practitioner must not base the opinion on any unreasonable 
factual assumptions (including assumptions as to future events). An 
unreasonable factual assumption includes a factual assumption that the 
practitioner knows or should know is incorrect or incomplete. For 
example, it is unreasonable to assume that a transaction has a business 
purpose or that a transaction is potentially profitable apart from tax 
benefits. A factual assumption includes reliance on a projection, 
financial forecast or appraisal. It is unreasonable for a practitioner 
to rely on a projection, financial forecast or appraisal if the 
practitioner knows or should know that the projection, financial 
forecast or appraisal is incorrect or incomplete or was prepared by a 
person lacking the skills or qualifications necessary to prepare such 
projection, financial forecast or appraisal. The opinion must identify 
in a separate section all factual assumptions relied upon by the 
practitioner.
    (iii) The practitioner must not base the opinion on any unreasonable 
factual representations, statements or findings of the taxpayer or any 
other person. An unreasonable factual representation includes a factual 
representation that the practitioner knows or should know is incorrect 
or incomplete. For example, a practitioner may not rely on a factual 
representation that a transaction has a business purpose if the 
representation does not include a specific description of the business 
purpose or the practitioner knows or should know that the representation 
is incorrect or incomplete. The opinion must identify in a separate 
section all factual representations, statements or findings of the 
taxpayer relied upon by the practitioner.
    (2) Relate law to facts. (i) The opinion must relate the applicable 
law (including potentially applicable judicial doctrines) to the 
relevant facts.
    (ii) The practitioner must not assume the favorable resolution of 
any significant Federal tax issue except as provided in paragraphs 
(c)(3)(v) and (d) of this section, or otherwise base an opinion on any 
unreasonable legal assumptions, representations, or conclusions.
    (iii) The opinion must not contain internally inconsistent legal 
analyses or conclusions.
    (3) Evaluation of significant Federal tax issues--(i) In general. 
The opinion must consider all significant Federal tax issues except as 
provided in paragraphs (c)(3)(v) and (d) of this section.
    (ii) Conclusion as to each significant Federal tax issue. The 
opinion must provide the practitioner's conclusion as to the likelihood 
that the taxpayer will prevail on the merits with respect to each 
significant Federal tax issue considered in the opinion. If the 
practitioner is unable to reach a conclusion with respect to one or more 
of those issues, the opinion must state that the practitioner is unable 
to reach a conclusion with respect to those issues. The opinion must 
describe the reasons for the conclusions, including the facts and 
analysis supporting the conclusions, or describe the reasons that the 
practitioner is unable to reach a conclusion as to one or more issues. 
If the practitioner fails to reach a conclusion at a confidence level of 
at least more likely than not with respect to one or more significant 
Federal tax issues considered, the opinion must include the appropriate 
disclosure(s) required under paragraph (e) of this section.
    (iii) Evaluation based on chances of success on the merits. In 
evaluating the significant Federal tax issues addressed in the opinion, 
the practitioner must not take into account the possibility that a tax 
return will not be audited, that an issue will not be raised on audit, 
or that an issue will be resolved through settlement if raised.
    (iv) Marketed opinions. In the case of a marketed opinion, the 
opinion must provide the practitioner's conclusion that the taxpayer 
will prevail on the merits at a confidence level of at least more likely 
than not with respect to each significant Federal tax issue. If the 
practitioner is unable to reach a more likely than not conclusion with 
respect to each significant Federal tax issue, the practitioner must not 
provide the marketed opinion, but may provide written advice that 
satisfies

[[Page 174]]

the requirements in paragraph (b)(5)(ii) of this section.
    (v) Limited scope opinions. (A) The practitioner may provide an 
opinion that considers less than all of the significant Federal tax 
issues if--
    (1) The practitioner and the taxpayer agree that the scope of the 
opinion and the taxpayer's potential reliance on the opinion for 
purposes of avoiding penalties that may be imposed on the taxpayer are 
limited to the Federal tax issue(s) addressed in the opinion;
    (2) The opinion is not advice described in paragraph (b)(2)(i)(A) of 
this section (concerning listed transactions), paragraph (b)(2)(i)(B) of 
this section (concerning the principal purpose of avoidance or evasion) 
or paragraph (b)(5) of this section (a marketed opinion); and
    (3) The opinion includes the appropriate disclosure(s) required 
under paragraph (e) of this section.
    (B) A practitioner may make reasonable assumptions regarding the 
favorable resolution of a Federal tax issue (an assumed issue) for 
purposes of providing an opinion on less than all of the significant 
Federal tax issues as provided in this paragraph (c)(3)(v). The opinion 
must identify in a separate section all issues for which the 
practitioner assumed a favorable resolution.
    (4) Overall conclusion. (i) The opinion must provide the 
practitioner's overall conclusion as to the likelihood that the Federal 
tax treatment of the transaction or matter that is the subject of the 
opinion is the proper treatment and the reasons for that conclusion. If 
the practitioner is unable to reach an overall conclusion, the opinion 
must state that the practitioner is unable to reach an overall 
conclusion and describe the reasons for the practitioner's inability to 
reach a conclusion.
    (ii) In the case of a marketed opinion, the opinion must provide the 
practitioner's overall conclusion that the Federal tax treatment of the 
transaction or matter that is the subject of the opinion is the proper 
treatment at a confidence level of at least more likely than not.
    (d) Competence to provide opinion; reliance on opinions of others. 
(1) The practitioner must be knowledgeable in all of the aspects of 
Federal tax law relevant to the opinion being rendered, except that the 
practitioner may rely on the opinion of another practitioner with 
respect to one or more significant Federal tax issues, unless the 
practitioner knows or should know that the opinion of the other 
practitioner should not be relied on. If a practitioner relies on the 
opinion of another practitioner, the relying practitioner's opinion must 
identify the other opinion and set forth the conclusions reached in the 
other opinion.
    (2) The practitioner must be satisfied that the combined analysis of 
the opinions, taken as a whole, and the overall conclusion, if any, 
satisfy the requirements of this section.
    (e) Required disclosures. A covered opinion must contain all of the 
following disclosures that apply--
    (1) Relationship between promoter and practitioner. An opinion must 
prominently disclose the existence of--
    (i) Any compensation arrangement, such as a referral fee or a fee-
sharing arrangement, between the practitioner (or the practitioner's 
firm or any person who is a member of, associated with, or employed by 
the practitioner's firm) and any person (other than the client for whom 
the opinion is prepared) with respect to promoting, marketing or 
recommending the entity, plan, or arrangement (or a substantially 
similar arrangement) that is the subject of the opinion; or
    (ii) Any referral agreement between the practitioner (or the 
practitioner's firm or any person who is a member of, associated with, 
or employed by the practitioner's firm) and a person (other than the 
client for whom the opinion is prepared) engaged in promoting, marketing 
or recommending the entity, plan, or arrangement (or a substantially 
similar arrangement) that is the subject of the opinion.
    (2) Marketed opinions. A marketed opinion must prominently disclose 
that--
    (i) The opinion was written to support the promotion or marketing of 
the transaction(s) or matter(s) addressed in the opinion; and
    (ii) The taxpayer should seek advice based on the taxpayer's 
particular circumstances from an independent tax advisor.

[[Page 175]]

    (3) Limited scope opinions. A limited scope opinion must prominently 
disclose that--
    (i) The opinion is limited to the one or more Federal tax issues 
addressed in the opinion;
    (ii) Additional issues may exist that could affect the Federal tax 
treatment of the transaction or matter that is the subject of the 
opinion and the opinion does not consider or provide a conclusion with 
respect to any additional issues; and
    (iii) With respect to any significant Federal tax issues outside the 
limited scope of the opinion, the opinion was not written, and cannot be 
used by the taxpayer, for the purpose of avoiding penalties that may be 
imposed on the taxpayer.
    (4) Opinions that fail to reach a more likely than not conclusion. 
An opinion that does not reach a conclusion at a confidence level of at 
least more likely than not with respect to a significant Federal tax 
issue must prominently disclose that--
    (i) The opinion does not reach a conclusion at a confidence level of 
at least more likely than not with respect to one or more significant 
Federal tax issues addressed by the opinion; and
    (ii) With respect to those significant Federal tax issues, the 
opinion was not written, and cannot be used by the taxpayer, for the 
purpose of avoiding penalties that may be imposed on the taxpayer.
    (5) Advice regarding required disclosures. In the case of any 
disclosure required under this section, the practitioner may not provide 
advice to any person that is contrary to or inconsistent with the 
required disclosure.
    (f) Effect of opinion that meets these standards--(1) In general. An 
opinion that meets the requirements of this section satisfies the 
practitioner's responsibilities under this section, but the 
persuasiveness of the opinion with regard to the tax issues in question 
and the taxpayer's good faith reliance on the opinion will be determined 
separately under applicable provisions of the law and regulations.
    (2) Standards for other written advice. A practitioner who provides 
written advice that is not a covered opinion for purposes of this 
section is subject to the requirements of Sec. 10.37.
    (g) Effective date. This section applies to written advice that is 
rendered after June 20, 2005.

[T.D. 9011, 67 FR 48771, July 26, 2002, as amended by T.D. 9165, 69 FR 
75842, Dec. 20, 2004; 70 FR 19892, Apr. 15, 2005; 70 FR 28825, May 19, 
2005]



Sec. 10.36  Procedures to ensure compliance.

    (a) Requirements for covered opinions. Any practitioner who has (or 
practitioners who have or share) principal authority and responsibility 
for overseeing a firm's practice of providing advice concerning Federal 
tax issues must take reasonable steps to ensure that the firm has 
adequate procedures in effect for all members, associates, and employees 
for purposes of complying with Sec. 10.35. Any such practitioner will 
be subject to discipline for failing to comply with the requirements of 
this paragraph if--
    (1) The practitioner through willfulness, recklessness, or gross 
incompetence does not take reasonable steps to ensure that the firm has 
adequate procedures to comply with Sec. 10.35, and one or more 
individuals who are members of, associated with, or employed by, the 
firm are, or have, engaged in a pattern or practice, in connection with 
their practice with the firm, of failing to comply with Sec. 10.35; or
    (2) The practitioner knows or should know that one or more 
individuals who are members of, associated with, or employed by, the 
firm are, or have, engaged in a pattern or practice, in connection with 
their practice with the firm, that does not comply with Sec. 10.35 and 
the practitioner, through willfulness, recklessness, or gross 
incompetence, fails to take prompt action to correct the noncompliance.
    (b) Effective date. This section is applicable after June 20, 2005.

[T.D. 9011, 67 FR 48771, July 26, 2002, as amended by T.D. 9165, 69 FR 
75842, Dec. 20, 2004]



Sec. 10.37  Requirements for other written advice.

    (a) Requirements. A practitioner must not give written advice 
(including electronic communications) concerning

[[Page 176]]

one or more Federal tax issues if the practitioner bases the written 
advice on unreasonable factual or legal assumptions (including 
assumptions as to future events), unreasonably relies upon 
representations, statements, findings or agreements of the taxpayer or 
any other person, does not consider all relevant facts that the 
practitioner knows or should know, or, in evaluating a Federal tax 
issue, takes into account the possibility that a tax return will not be 
audited, that an issue will not be raised on audit, or that an issue 
will be resolved through settlement if raised. All facts and 
circumstances, including the scope of the engagement and the type and 
specificity of the advice sought by the client will be considered in 
determining whether a practitioner has failed to comply with this 
section. In the case of an opinion the practitioner knows or has reason 
to know will be used or referred to by a person other than the 
practitioner (or a person who is a member of, associated with, or 
employed by the practitioner's firm) in promoting, marketing or 
recommending to one or more taxpayers a partnership or other entity, 
investment plan or arrangement a significant purpose of which is the 
avoidance or evasion of any tax imposed by the Internal Revenue Code, 
the determination of whether a practitioner has failed to comply with 
this section will be made on the basis of a heightened standard of care 
because of the greater risk caused by the practitioner's lack of 
knowledge of the taxpayer's particular circumstances.
    (b) Effective date. This section applies to written advice that is 
rendered after June 20, 2005.

[T.D. 9011, 67 FR 48771, July 26, 2002, as amended by T.D. 9165, 69 FR 
75842, Dec. 20, 2004; 70 FR 20805, Apr. 21, 2005]



Sec. 10.38  Establishment of advisory committees.

    (a) Advisory committees. To promote and maintain the public's 
confidence in tax advisors, the Director of the Office of Professional 
Responsibility is authorized to establish one or more advisory 
committees composed of at least five individuals authorized to practice 
before the Internal Revenue Service. The Director should ensure that 
membership of an advisory committee is balanced among those who practice 
as attorneys, accountants, and enrolled agents. Under procedures 
prescribed by the Director, an advisory committee may review and make 
general recommendations regarding professional standards or best 
practices for tax advisors, including whether hypothetical conduct would 
give rise to a violation of Sec. Sec. 10.35 or 10.36.
    (b) Effective date. This section applies after December 20, 2004.

[T.D. 9011, 67 FR 48771, July 26, 2002, as amended by T.D. 9165, 69 FR 
75842, Dec. 20, 2004]



          Subpart C_Sanctions for Violation of the Regulations

    Source: T.D. 9011, 67 FR 48774, July 26, 2002, unless otherwise 
noted.



Sec. 10.50  Sanctions.

    (a) Authority to censure, suspend, or disbar. The Secretary of the 
Treasury, or his or her delegate, after notice and an opportunity for a 
proceeding, may censure, suspend or disbar any practitioner from 
practice before the Internal Revenue Service if the practitioner is 
shown to be incompetent or disreputable, fails to comply with any 
regulation in this part, or with intent to defraud, willfully and 
knowingly misleads or threatens a client or prospective client. Censure 
is a public reprimand.
    (b) Authority to disqualify. The Secretary of the Treasury, or his 
or her delegate, after due notice and opportunity for hearing, may 
disqualify any appraiser with respect to whom a penalty has been 
assessed under section 6701(a) of the Internal Revenue Code.
    (1) If any appraiser is disqualified pursuant to this subpart C, 
such appraiser is barred from presenting evidence or testimony in any 
administrative proceeding before the Department of Treasury or the 
Internal Revenue Service, unless and until authorized to do so by the 
Director of Practice pursuant to Sec. 10.81, regardless of whether such 
evidence or testimony would pertain to an appraisal made prior to or 
after such date.

[[Page 177]]

    (2) Any appraisal made by a disqualified appraiser after the 
effective date of disqualification will not have any probative effect in 
any administrative proceeding before the Department of the Treasury or 
the Internal Revenue Service. An appraisal otherwise barred from 
admission into evidence pursuant to this section may be admitted into 
evidence solely for the purpose of determining the taxpayer's reliance 
in good faith on such appraisal.



Sec. 10.51  Incompetence and disreputable conduct.

    Incompetence and disreputable conduct for which a practitioner may 
be censured, suspended or disbarred from practice before the Internal 
Revenue Service includes, but is not limited to--
    (a) Conviction of any criminal offense under the revenue laws of the 
United States;
    (b) Conviction of any criminal offense involving dishonesty or 
breach of trust;
    (c) Conviction of any felony under Federal or State law for which 
the conduct involved renders the practitioner unfit to practice before 
the Internal Revenue Service;
    (d) Giving false or misleading information, or participating in any 
way in the giving of false or misleading information to the Department 
of the Treasury or any officer or employee thereof, or to any tribunal 
authorized to pass upon Federal tax matters, in connection with any 
matter pending or likely to be pending before them, knowing such 
information to be false or misleading. Facts or other matters contained 
in testimony, Federal tax returns, financial statements, applications 
for enrollment, affidavits, declarations, or any other document or 
statement, written or oral, are included in the term information.
    (e) Solicitation of employment as prohibited under Sec. 10.30, the 
use of false or misleading representations with intent to deceive a 
client or prospective client in order to procure employment, or 
intimating that the practitioner is able improperly to obtain special 
consideration or action from the Internal Revenue Service or officer or 
employee thereof.
    (f) Willfully failing to make a Federal tax return in violation of 
the revenue laws of the United States, willfully evading, attempting to 
evade, or participating in any way in evading or attempting to evade any 
assessment or payment of any Federal tax, or knowingly counseling or 
suggesting to a client or prospective client an illegal plan to evade 
Federal taxes or payment thereof.
    (g) Misappropriation of, or failure properly and promptly to remit 
funds received from a client for the purpose of payment of taxes or 
other obligations due the United States.
    (h) Directly or indirectly attempting to influence, or offering or 
agreeing to attempt to influence, the official action of any officer or 
employee of the Internal Revenue Service by the use of threats, false 
accusations, duress or coercion, by the offer of any special inducement 
or promise of advantage or by the bestowing of any gift, favor or thing 
of value.
    (i) Disbarment or suspension from practice as an attorney, certified 
public accountant, public accountant, or actuary by any duly constituted 
authority of any State, territory, possession of the United States, 
including a Commonwealth, or the District of Columbia, any Federal court 
of record or any Federal agency, body or board.
    (j) Knowingly aiding and abetting another person to practice before 
the Internal Revenue Service during a period of suspension, disbarment, 
or ineligibility of such other person.
    (k) Contemptuous conduct in connection with practice before the 
Internal Revenue Service, including the use of abusive language, making 
false accusations and statements, knowing them to be false, or 
circulating or publishing malicious or libelous matter.
    (l) Giving a false opinion, knowingly, recklessly, or through gross 
incompetence, including an opinion which is intentionally or recklessly 
misleading, or engaging in a pattern of providing incompetent opinions 
on questions arising under the Federal tax laws. False opinions 
described in this paragraph (l) include those which reflect or result 
from a knowing misstatement of fact or law, from an assertion of a 
position known to be unwarranted under

[[Page 178]]

existing law, from counseling or assisting in conduct known to be 
illegal or fraudulent, from concealing matters required by law to be 
revealed, or from consciously disregarding information indicating that 
material facts expressed in the tax opinion or offering material are 
false or misleading. For purposes of this paragraph (l), reckless 
conduct is a highly unreasonable omission or misrepresentation involving 
an extreme departure from the standards of ordinary care that a 
practitioner should observe under the circumstances. A pattern of 
conduct is a factor that will be taken into account in determining 
whether a practitioner acted knowingly, recklessly, or through gross 
incompetence. Gross incompetence includes conduct that reflects gross 
indifference, preparation which is grossly inadequate under the 
circumstances, and a consistent failure to perform obligations to the 
client.



Sec. 10.52  Violation of regulations.

    (a) Prohibited conduct. A practitioner may be censured, suspended or 
disbarred from practice before the Internal Revenue Service for any of 
the following:
    (1) Willfully violating any of the regulations (other than Sec. 
10.33) contained in this part; or
    (2) Recklessly or through gross incompetence (within the meaning of 
Sec. 10.51(l)) violating Sec. Sec. 10.34, 10.35, 10.36 or 10.37.
    (b) Effective date. This section applies after June 20, 2005.

[T.D. 9011, 67 FR 48771, July 26, 2002, as amended by T.D. 9165, 69 FR 
75845, Dec. 20, 2004]



         Subpart D_Rules Applicable to Disciplinary Proceedings

    Source: 67 FR 48774, July 26, 2002, unless otherwise noted.



Sec. 10.60  Institution of proceeding.

    (a) Whenever the Director of Practice determines that a practitioner 
violated any provision of the laws governing practice before the 
Internal Revenue Service or the regulations in this part, the Director 
of Practice may reprimand the practitioner or, in accordance with Sec. 
10.62, institute a proceeding for censure, suspension, or disbarment of 
the practitioner. A proceeding for censure, suspension, or disbarment of 
a practitioner is instituted by the filing of a complaint, the contents 
of which are more fully described in Sec. 10.62.
    (b) Whenever the Director of Practice is advised or becomes aware 
that a penalty has been assessed against an appraiser under section 
6701(a) of the Internal Revenue Code, the Director of Practice may 
reprimand the appraiser or, in accordance with Sec. 10.62, institute a 
proceeding for disqualification of the appraiser. A proceeding for 
disqualification of an appraiser is instituted by the filing of a 
complaint, the contents of which are more fully described in Sec. 
10.62.
    (c) Except as provided in Sec. 10.82, a proceeding will not be 
instituted under this section unless the proposed respondent previously 
has been advised in writing of the law, facts and conduct warranting 
such action and has been accorded an opportunity to dispute facts, 
assert additional facts, and make arguments (including an explanation or 
description of mitigating circumstances).



Sec. 10.61  Conferences.

    (a) In general. The Director of Practice may confer with a 
practitioner or an appraiser concerning allegations of misconduct 
irrespective of whether a proceeding for censure, suspension, 
disbarment, or disqualification has been instituted against the 
practitioner or appraiser. If the conference results in a stipulation in 
connection with an ongoing proceeding in which the practitioner or 
appraiser is the respondent, the stipulation may be entered in the 
record by either party to the proceeding.
    (b) Resignation or voluntary censure, suspension or disbarment. In 
lieu of a proceeding being instituted or continued under paragraph (a) 
of Sec. 10.60, a practitioner may offer his or her consent to the 
issuance of a censure, suspension or disbarment, or, if the practitioner 
is an enrolled agent, may offer to resign. The Director of Practice may, 
in his or her discretion, accept or decline the offered censure, 
suspension, disbarment, or offer of resignation by

[[Page 179]]

an enrolled agent, in accordance with the consent offered. In any 
declination, the Director of Practice may state that he or she would 
accept an offer of censure, suspension, or disbarment, or, if the 
practitioner is an enrolled agent, offer of resignation, containing 
different terms; the Director of Practice may, in his or her discretion, 
accept or reject a revised offer of censure, suspension, disbarment, or 
offer of resignation by an enrolled agent, submitted in response to the 
declination or may counteroffer and act upon any accepted counteroffer.
    (c) Voluntary disqualification. In lieu of a proceeding being 
instituted or continued under paragraph (b) of Sec. 10.60, an appraiser 
may offer his or her consent to disqualification. The Director of 
Practice may, in his or her discretion, accept or decline the offered 
disqualification, in accordance with the consent offered. In any 
declination, the Director of Practice may state that he or she would 
accept an offer of disqualification containing different terms; the 
Director of Practice may, in his or her discretion, accept or reject a 
revised offer of censure, suspension or disbarment submitted in response 
to the declination or may counteroffer and act upon any accepted 
counteroffer.



Sec. 10.62  Contents of complaint.

    (a) Charges. A complaint must name the respondent, provide a clear 
and concise description of the facts and law that constitute the basis 
for the proceeding, and be signed by the Director of Practice or a 
person representing the Director of Practice under Sec. 10.69(a)(1). A 
complaint is sufficient if it fairly informs the respondent of the 
charges brought so that he or she is able to prepare a defense. In the 
case of a complaint filed against an appraiser, the complaint is 
sufficient if it refers to a penalty imposed previously on the 
respondent under section 6701(a) of the Internal Revenue Code.
    (b) Specification of sanction. The complaint must specify the 
sanction sought by the Director of Practice against the practitioner or 
appraiser. If the sanction sought is a suspension, the duration of the 
suspension sought must be specified.
    (c) Demand for answer. The Director of Practice must, in the 
complaint or in a separate paper attached to the complaint, notify the 
respondent of the time for answering the complaint, the time for which 
may not be less than15 days from the date of service of the complaint, 
the name and address of the Administrative Law Judge with whom the 
answer must be filed, the name and address of the person representing 
the Director of Practice to whom a copy of the answer must be served, 
and that a decision by default may be rendered against the respondent in 
the event an answer is not filed as required.



Sec. 10.63  Service of complaint; service and filing of other papers.

    (a) Service of complaint--(1) In general. The complaint or a copy of 
the complaint must be served on the respondent by any manner described 
in paragraphs (a)(2) or (3) of this section.
    (2) Service by certified or first class mail. (i) Service of the 
complaint may be made on the respondent by mailing the complaint by 
certified mail to the last known address (as determined under section 
6212 of the Internal Revenue Code and the regulations thereunder) of the 
respondent. Where service is by certified mail, the returned post office 
receipt duly signed by the respondent will be proof of service.
    (ii) If the certified mail is not claimed or accepted by the 
respondent, or is returned undelivered, service may be made on the 
respondent, by mailing the complaint to the respondent by first class 
mail. Service by this method will be considered complete upon mailing, 
provided the complaint is addressed to the respondent at the 
respondent's last known address as determined under section 6212 of the 
Internal Revenue Code and the regulations thereunder.
    (3) Service by other than certified or first class mail. (i) Service 
of the complaint may be made on the respondent by delivery by a private 
delivery service designated pursuant to section 7502(f) of the Internal 
Revenue Code to the last known address (as determined under section 6212 
of the Internal Revenue Code and the regulations thereunder) of the 
respondent. Service by

[[Page 180]]

this method will be considered complete, provided the complaint is 
addressed to the respondent at the respondent's last known address as 
determined under section 6212 of the Internal Revenue Code and the 
regulations thereunder.
    (ii) Service of the complaint may be made in person on, or by 
leaving the complaint at the office or place of business of, the 
respondent. Service by this method will be considered complete and proof 
of service will be a written statement, sworn or affirmed by the person 
who served the complaint, identifying the manner of service, including 
the recipient, relationship of recipient to respondent, place, date and 
time of service.
    (iii) Service may be made by any other means agreed to by the 
respondent. Proof of service will be a written statement, sworn or 
affirmed by the person who served the complaint, identifying the manner 
of service, including the recipient, relationship of recipient to 
respondent, place, date and time of service.
    (4) For purposes of this paragraph (a), ``respondent'' means the 
practitioner or appraiser named in the complaint or any other person 
having the authority to accept mail on behalf of the practitioner or 
appraiser.
    (b) Service of papers other than complaint. Any paper other than the 
complaint may be served on the respondent, or his or her authorized 
representative under Sec. 10.69(a)(2) by:
    (1) Mailing the paper by first class mail to the last known address 
(as determined under section 6212 of the Internal Revenue Code and the 
regulations thereunder) of the respondent or the respondent's authorized 
representative,
    (2) Delivery by a private delivery service designated pursuant to 
section 7502(f) of the Internal Revenue Code to the last known address 
(as determined under section 6212 of the Internal Revenue Code and the 
regulations thereunder) of the respondent or the respondent's authorized 
representative, or
    (3) As provided in paragraphs (a)(3)(ii) and (a)(3)(iii) of this 
section.
    (c) Service of papers on the Director of Practice. Whenever a paper 
is required or permitted to be served on the Director of Practice in 
connection with a proceeding under this part, the paper will be served 
on the Director of Practice's authorized representative under Sec. 
10.69(a)(1) at the address designated in the complaint, or at an address 
provided in a notice of appearance. If no address is designated in the 
complaint or provided in a notice of appearance, service will be made on 
the Director of Practice, Internal Revenue Service, 1111 Constitution 
Avenue, NW., Washington, DC 20224.
    (d) Filing of papers. Whenever the filing of a paper is required or 
permitted in connection with a proceeding under this part, the original 
paper, plus one additional copy, must be filed with the Administrative 
Law Judge at the address specified in the complaint or at an address 
otherwise specified by the Administrative Law Judge. All papers filed in 
connection with a proceeding under this part must be served on the other 
party, unless the Administrative Law Judge directs otherwise. A 
certificate evidencing such must be attached to the original paper filed 
with the Administrative Law Judge.



Sec. 10.64  Answer; default.

    (a) Filing. The respondent's answer must be filed with the 
Administrative Law Judge, and served on the Director of Practice, within 
the time specified in the complaint unless, on request or application of 
the respondent, the time is extended by the Administrative Law Judge.
    (b) Contents. The answer must be written and contain a statement of 
facts that constitute the respondent's grounds of defense. General 
denials are not permitted. The respondent must specifically admit or 
deny each allegation set forth in the complaint, except that the 
respondent may state that the respondent is without sufficient 
information to admit or deny a specific allegation. The respondent, 
nevertheless, may not deny a material allegation in the complaint that 
the respondent knows to be true, or state that the respondent is without 
sufficient information to form a belief, when the respondent possesses 
the required information.

[[Page 181]]

The respondent also must state affirmatively any special matters of 
defense on which he or she relies.
    (c) Failure to deny or answer allegations in the complaint. Every 
allegation in the complaint that is not denied in the answer is deemed 
admitted and will be considered proved; no further evidence in respect 
of such allegation need be adduced at a hearing.
    (d) Default. Failure to file an answer within the time prescribed 
(or within the time for answer as extended by the Administrative Law 
Judge), constitutes an admission of the allegations of the complaint and 
a waiver of hearing, and the Administrative Law Judge may make the 
decision by default without a hearing or further procedure. A decision 
by default constitutes a decision under Sec. 10.76.
    (e) Signature. The answer must be signed by the respondent or the 
respondent's authorized representative under Sec. 10.69(a)(2) and must 
include a statement directly above the signature acknowledging that the 
statements made in the answer are true and correct and that knowing and 
willful false statements may be punishable under 18 U.S.C. 1001.



Sec. 10.65  Supplemental charges.

    If it appears that the respondent, in his or her answer, falsely and 
in bad faith, denies a material allegation of fact in the complaint or 
states that the respondent has insufficient knowledge to form a belief, 
when the respondent in fact possesses such information, or if it appears 
that the respondent has knowingly introduced false testimony during 
proceedings for his or her censure, suspension, disbarment, or 
disqualification, the Director of Practice may file supplemental charges 
against the respondent. The supplemental charges may be heard with other 
charges in the case, provided the respondent is given due notice of the 
charges and is afforded an opportunity to prepare a defense to such 
charges.



Sec. 10.66  Reply to answer.

    The Director of Practice may file a reply to the respondent's 
answer, but unless otherwise ordered by the Administrative Law Judge, no 
reply to the respondent's answer is required. If a reply is not filed, 
new matter in the answer is deemed denied.



Sec. 10.67  Proof; variance; amendment of pleadings.

    In the case of a variance between the allegations in pleadings and 
the evidence adduced in support of the pleadings, the Administrative Law 
Judge, at any time before decision, may order or authorize amendment of 
the pleadings to conform to the evidence. The party who would otherwise 
be prejudiced by the amendment must be given a reasonable opportunity to 
address the allegations of the pleadings as amended and the 
Administrative Law Judge must make findings on any issue presented by 
the pleadings as amended.



Sec. 10.68  Motions and requests.

    (a) Motions. At any time after the filing of the complaint, any 
party may file a motion with the Administrative Law Judge. Unless 
otherwise ordered by the Administrative Law Judge, motions must be in 
writing and must be served on the opposing party as provided in Sec. 
10.63(b). A motion must concisely specify its grounds and the relief 
sought, and, if appropriate, must contain a memorandum of facts and law 
in support. Before moving, a party must make a good faith effort to 
resolve with the other party any dispute that gives rise to, or is a 
concern of, the motion. The movant must certify such an attempt was made 
and state, if it is known, whether the opposing party opposes the 
motion.
    (b) Response. Unless otherwise ordered by the Administrative Law 
Judge, the nonmoving party is not required to file a response to a 
motion. If the Administrative Law Judge does not order the nonmoving 
party to file a response, the nonmoving party is deemed to oppose the 
motion.
    (c) Oral motions and arguments. The Administrative Law Judge may, 
for good cause and with notice to the parties, permit oral motions and 
oral opposition to motions. The Administrative Law Judge may, within his 
or her discretion, permit oral argument on any motion.

[[Page 182]]



Sec. 10.69  Representation; ex parte communication.

    (a) Representation. (1) The Director of Practice may be represented 
in proceedings under this part by an attorney or other employee of the 
Internal Revenue Service. An attorney or an employee of the Internal 
Revenue Service representing the Director of Practice in a proceeding 
under this part may sign the complaint or any document required to be 
filed in the proceeding on behalf of the Director of Practice.
    (2) A respondent may appear in person, be represented by a 
practitioner, or be represented by an attorney who has not filed a 
declaration with the Internal Revenue Service pursuant to Sec. 10.3. A 
practitioner or an attorney representing a respondent or proposed 
respondent may sign the answer or any document required to be filed in 
the proceeding on behalf of the respondent.
    (b) Ex parte communication. The Director of Practice, the 
respondent, and any representatives of either party, may not attempt to 
initiate or participate in ex parte discussions concerning a proceeding 
or potential proceeding with the Administrative Law Judge (or any person 
who is likely to advise the Administrative Law Judge on a ruling or 
decision) in the proceeding before or during the pendency of the 
proceeding. Any memorandum, letter or other communication concerning the 
merits of the proceeding, addressed to the Administrative Law Judge, by 
or on behalf of any party shall be regarded as an argument in the 
proceeding and shall be served on the other party.



Sec. 10.70  Administrative Law Judge.

    (a) Appointment. Proceedings on complaints for the censure, 
suspension or disbarment of a practitioner or the disqualification of an 
appraiser will be conducted by an Administrative Law Judge appointed as 
provided by 5 U.S.C. 3105.
    (b) Powers of the Administrative Law Judge. The Administrative Law 
Judge, among other powers, has the authority, in connection with any 
proceeding under Sec. 10.60 assigned or referred to him or her, to do 
the following:
    (1) Administer oaths and affirmations;
    (2) Make rulings on motions and requests, which rulings may not be 
appealed prior to the close of a hearing except in extraordinary 
circumstances and at the discretion of the Administrative Law Judge;
    (3) Determine the time and place of hearing and regulate its course 
and conduct;
    (4) Adopt rules of procedure and modify the same from time to time 
as needed for the orderly disposition of proceedings;
    (5) Rule on offers of proof, receive relevant evidence, and examine 
witnesses;
    (6) Take or authorize the taking of depositions;
    (7) Receive and consider oral or written argument on facts or law;
    (8) Hold or provide for the holding of conferences for the 
settlement or simplification of the issues with the consent of the 
parties;
    (9) Perform such acts and take such measures as are necessary or 
appropriate to the efficient conduct of any proceeding; and
    (10) Make decisions.



Sec. 10.71  Hearings.

    (a) In general. An Administrative Law Judge will preside at the 
hearing on a complaint filed under paragraph (c) of Sec. 10.60 for the 
censure, suspension, or disbarment of a practitioner or disqualification 
of an appraiser. Hearings will be stenographically recorded and 
transcribed and the testimony of witnesses will be taken under oath or 
affirmation. Hearings will be conducted pursuant to 5 U.S.C. 556. A 
hearing in a proceeding requested under paragraph (g) of Sec. 10.82 
will be conducted de novo. An evidentiary hearing must be held in all 
proceedings prior to the issuance of a decision by the Administrative 
Law Judge unless: the Director of Practice withdraws the complaint; the 
practitioner consents to a sanction pursuant to Sec. 10.61(b); a 
decision is issued by default pursuant to Sec. 10.64(d), a decision is 
issued under Sec. 10.82(e); the respondent requests a decision on the 
record without a hearing; or the Administrative Law Judge issues a 
decision on a motion that disposes of the case prior to the hearing.

[[Page 183]]

    (b) Publicity of proceedings. A request by a practitioner or 
appraiser that a hearing in a disciplinary proceeding concerning him or 
her be public, and that the record of such disciplinary proceeding be 
made available for inspection by interested persons may be granted by 
the Administrative Law Judge where the parties stipulate in advance to 
protect from disclosure confidential tax information in accordance with 
all applicable statutes and regulations.
    (c) Location. The location of the hearing will be determined by the 
agreement of the parties with the approval of the Administrative Law 
Judge, but, in the absence of such agreement and approval, the hearing 
will be held in Washington, D.C.
    (d) Failure to appear. If either party to the proceeding fails to 
appear at the hearing, after notice of the proceeding has been sent to 
him or her, the party will be deemed to have waived the right to a 
hearing and the Administrative Law Judge may make his or her decision 
against the absent party by default.



Sec. 10.72  Evidence.

    (a) In general. The rules of evidence prevailing in courts of law 
and equity are not controlling in hearings or proceedings conducted 
under this part. The Administrative Law Judge may, however, exclude 
evidence that is irrelevant, immaterial, or unduly repetitious,
    (b) Depositions. The deposition of any witness taken pursuant to 
Sec. 10.73 may be admitted into evidence in any proceeding instituted 
under Sec. 10.60.
    (c) Proof of documents. Official documents, records, and papers of 
the Internal Revenue Service and the Office of Director of Practice are 
admissible in evidence without the production of an officer or employee 
to authenticate them. Any such documents, records, and papers may be 
evidenced by a copy attested or identified by an officer or employee of 
the Internal Revenue Service or the Treasury Department, as the case may 
be.
    (d) Withdrawal of exhibits. If any document, record, or other paper 
is introduced in evidence as an exhibit, the Administrative Law Judge 
may authorize the withdrawal of the exhibit subject to any conditions 
that he or she deems proper.
    (e) Objections. Objections to evidence are to be made in short form, 
stating the grounds for the objection. Except as ordered by the 
Administrative Law Judge, argument on objections will not be recorded or 
transcribed. Rulings on objections are to be a part of the record, but 
no exception to a ruling is necessary to preserve the rights of the 
parties.



Sec. 10.73  Depositions.

    (a) Depositions for use at a hearing may be taken, with the written 
approval of the Administrative Law Judge, by either the Director of 
Practice or the respondent or their duly authorized representatives. 
Depositions may be taken before any officer duly authorized to 
administer an oath for general purposes or before an officer or employee 
of the Internal Revenue Service who is authorized to administer an oath 
in internal revenue matters.
    (b) The party taking the deposition must provide the deponent and 
the other party with 10 days written notice of the deposition, unless 
the deponent and the parties agree otherwise. The notice must specify 
the name of the deponent, the time and place where the deposition is to 
be taken, and whether the deposition will be taken by oral or written 
interrogatories. When a deposition is taken by written interrogatories, 
any cross-examination also will be by written interrogatories. Copies of 
the written interrogatories must be served on the other party with the 
notice of deposition, and copies of any written cross-interrogation must 
be mailed or delivered to the opposing party at least 5 days before the 
date that the deposition will be taken, unless the parties mutually 
agree otherwise. A party on whose behalf a deposition is taken must file 
the responses to the written interrogatories or a transcript of the oral 
deposition with the Administrative Law Judge and serve copies on the 
opposing party and the deponent. Expenses in the reporting of 
depositions will be borne by the party that requested the deposition.

[[Page 184]]



Sec. 10.74  Transcript.

    In cases where the hearing is stenographically reported by a 
Government contract reporter, copies of the transcript may be obtained 
from the reporter at rates not to exceed the maximum rates fixed by 
contract between the Government and the reporter. Where the hearing is 
stenographically reported by a regular employee of the Internal Revenue 
Service, a copy will be supplied to the respondent either without charge 
or upon the payment of a reasonable fee. Copies of exhibits introduced 
at the hearing or at the taking of depositions will be supplied to the 
parties upon the payment of a reasonable fee (Sec. 501, Public Law 82-
137)(65 Stat. 290)(31 U.S.C. 483a).



Sec. 10.75  Proposed findings and conclusions.

    Except in cases where the respondent has failed to answer the 
complaint or where a party has failed to appear at the hearing, the 
parties must be afforded a reasonable opportunity to submit proposed 
findings and conclusions and their supporting reasons to the 
Administrative Law Judge.



Sec. 10.76  Decision of Administrative Law Judge.

    (a) As soon as practicable after the conclusion of a hearing and the 
receipt of any proposed findings and conclusions timely submitted by the 
parties, the Administrative Law Judge will enter a decision in the case. 
The decision must include a statement of findings and conclusions, as 
well as the reasons or basis for making such findings and conclusions, 
and an order of censure, suspension, disbarment, disqualification, or 
dismissal of the complaint. If the sanction is censure or a suspension 
of less than six month's duration, the Administrative Law Judge, in 
rendering findings and conclusions, will consider an allegation of fact 
to be proven if it is established by the party who is alleging the fact 
by a preponderance of evidence in the record. In the event that the 
sanction is disbarment or a suspension of a duration of six months or 
longer, an allegation of fact that is necessary for a finding against 
the practitioner must be proven by clear and convincing evidence in the 
record. An allegation of fact that is necessary for a finding of 
disqualification against an appraiser must be proven by clear and 
convincing evidence in the record. The Administrative Law Judge will 
provide the decision to the Director of Practice and a copy of the 
decision to the respondent or the respondent's authorized 
representative.
    (b) In the absence of an appeal to the Secretary of the Treasury or 
his or her designee, or review of the decision on motion of the 
Secretary or his or her designee, the decision of the Administrative Law 
Judge will, without further proceedings, become the decision of the 
agency 30 days after the date of the Administrative Law Judge's 
decision.



Sec. 10.77  Appeal of decision of Administrative Law Judge.

    Within 30 days from the date of the Administrative Law Judge's 
decision, either party may appeal to the Secretary of the Treasury, or 
his or her delegate. The respondent must file his or her appeal with the 
Director of Practice in duplicate and a notice of appeal must include 
exceptions to the decision of the Administrative Law Judge and 
supporting reasons for such exceptions. If the Director of Practice 
files an appeal, he or she must provide a copy to the respondent. Within 
30 days after receipt of an appeal or copy thereof, the other party may 
file a reply brief in duplicate with the Director of Practice. If the 
reply brief is filed by the Director of Practice, he or she must provide 
a copy of it to the respondent. The Director of Practice must provide 
the entire record to the Secretary of the Treasury, or his or her 
delegate, after the appeal and any reply brief has been filed.



Sec. 10.78  Decision on appeal.

    On appeal from or review of the decision of the Administrative Law 
Judge, the Secretary of the Treasury, or his or her delegate, will make 
the agency decision. The Secretary of the Treasury, or his or delegate, 
will provide a copy of the agency decision to the Director of Practice 
and the respondent or the respondent's authorized representative. The 
decision of the Administrative Law Judge will not be reversed unless

[[Page 185]]

the appellant establishes that the decision is clearly erroneous in 
light of the evidence in the record and applicable law. Issues that are 
exclusively matters of law will be reviewed de novo. In the event that 
the Secretary of the Treasury, or his or her delegate, determines that 
there are unresolved issues raised by the record, the case may be 
remanded to the Administrative Law Judge to elicit additional testimony 
or evidence. A copy of the agency decision or that of his or her 
delegate will be provided to the Director of Practice and the respondent 
contemporaneously.



Sec. 10.79  Effect of disbarment, suspension, or censure.

    (a) Disbarment. When the final decision in a case is against the 
respondent (or the respondent has offered his or her consent and such 
consent has been accepted by the Director of Practice) and such decision 
is for disbarment, the respondent will not be permitted to practice 
before the Internal Revenue Service unless and until authorized to do so 
by the Director of Practice pursuant to Sec. 10.81.
    (b) Suspension. When the final decision in a case is against the 
respondent (or the respondent has offered his or her consent and such 
consent has been accepted by the Director of Practice) and such decision 
is for suspension, the respondent will not be permitted to practice 
before the Internal Revenue Service during the period of suspension. For 
periods after the suspension, the practitioner's future representations 
may be subject to conditions as authorized by paragraph (d) of this 
section.
    (c) Censure. When the final decision in the case is against the 
respondent (or the respondent has offered his or her consent and such 
consent has been accepted by the Director of Practice) and such decision 
is for censure, the respondent will be permitted to practice before the 
Internal Revenue Service, but the respondent's future representations 
may be subject to conditions as authorized by paragraph (d) of this 
section. o
    (d) Conditions. After being subject to the sanction of either 
suspension or censure, the future representations of a practitioner so 
sanctioned shall be subject to conditions prescribed by the Director of 
Practice designed to promote high standards of conduct. These conditions 
can be imposed for a reasonable period in light of the gravity of the 
practitioner's violations. For example, where a practitioner is censured 
because he or she failed to advise his or her clients about a potential 
conflict of interest or failed to obtain the clients' written consents, 
the Director of Practice may require the practitioner to provide the 
Director of Practice or another Internal Revenue Service official with a 
copy of all consents obtained by the practitioner for an appropriate 
period following censure, whether or not such consents are specifically 
requested.



Sec. 10.80  Notice of disbarment, suspension, censure, or 
disqualification.

    On the issuance of a final order censuring, suspending, or 
disbarring a practitioner or a final order disqualifying an appraiser, 
the Director of Practice may give notice of the censure, suspension, 
disbarment, or disqualification to appropriate officers and employees of 
the Internal Revenue Service and to interested departments and agencies 
of the Federal government. The Director of Practice may determine the 
manner of giving notice to the proper authorities of the State by which 
the censured, suspended, or disbarred person was licensed to practice.



Sec. 10.81  Petition for reinstatement.

    The Director of Practice may entertain a petition for reinstatement 
from any person disbarred from practice before the Internal Revenue 
Service or any disqualified appraiser after the expiration of 5 years 
following such disbarment or disqualification. Reinstatement may not be 
granted unless the Director of Practice is satisfied that the 
petitioner, thereafter, is not likely to conduct himself contrary to the 
regulations in this part, and that granting such reinstatement would not 
be contrary to the public interest.

[[Page 186]]



Sec. 10.82  Expedited suspension upon criminal conviction or loss of 
license for cause.

    (a) When applicable. Whenever the Director of Practice determines 
that a practitioner is described in paragraph (b) of this section, the 
Director of Practice may institute a proceeding under this section to 
suspend the practitioner from practice before the Internal Revenue 
Service.
    (b) To whom applicable. This section applies to any practitioner 
who, within 5 years of the date a complaint instituting a proceeding 
under this section is served:
    (1) Has had his or her license to practice as an attorney, certified 
public accountant, or actuary suspended or revoked for cause (not 
including a failure to pay a professional licensing fee) by any 
authority or court, agency, body, or board described in Sec. 10.51(i); 
or
    (2) Has, irrespective of whether an appeal has been taken, been 
convicted of any crime under title 26 of the United States Code, any 
crime involving dishonesty or breach of trust, or any felony for which 
the conduct involved renders the practitioner unfit to practice before 
the Internal Revenue Service.
    (3) Has violated conditions designed to promote high standards of 
conduct established pursuant to Sec. 10.79(d).
    (c) Instituting a proceeding. A proceeding under this section will 
be instituted by a complaint that names the respondent, is signed by the 
Director of Practice or a person representing the Director of Practice 
under Sec. 10.69(a)(1), is filed in the Director of Practice's office, 
and is served according to the rules set forth in paragraph (a) of Sec. 
10.63. The complaint must give a plain and concise description of the 
allegations that constitute the basis for the proceeding. The complaint 
must notify the respondent--
    (1) Of the place and due date for filing an answer;
    (2) That a decision by default may be rendered if the respondent 
fails to file an answer as required;
    (3) That the respondent may request a conference with the Director 
of Practice to address the merits of the complaint and that any such 
request must be made in the answer; and
    (4) That the respondent may be suspended either immediately 
following the expiration of the period within which an answer must be 
filed or, if a conference is requested, immediately following the 
conference.
    (d) Answer. The answer to a complaint described in this section must 
be filed no later than 30 calendar days following the date the complaint 
is served, unless the Director of Practice extends the time for filing. 
The answer must be filed in accordance with the rules set forth in Sec. 
10.64, except as otherwise provided in this section. A respondent is 
entitled to a conference with the Director of Practice only if the 
conference is requested in a timely filed answer. If a request for a 
conference is not made in the answer or the answer is not timely filed, 
the respondent will be deemed to have waived his or her right to a 
conference and the Director of Practice may suspend such respondent at 
any time following the date on which the answer was due.
    (e) Conference. The Director of Practice or his or her designee will 
preside at a conference described in this section. The conference will 
be held at a place and time selected by the Director of Practice, but no 
sooner than 14 calendar days after the date by which the answer must be 
filed with the Director of Practice, unless the respondent agrees to an 
earlier date. An authorized representative may represent the respondent 
at the conference. Following the conference, upon a finding that the 
respondent is described in paragraph (b) of this section, or upon the 
respondent's failure to appear at the conference either personally or 
through an authorized representative, the Director of Practice may 
immediately suspend the respondent from practice before the Internal 
Revenue Service.
    (f) Duration of suspension. A suspension under this section will 
commence on the date that written notice of the suspension is issued. A 
practitioner's suspension will remain effective until the earlier of the 
following--
    (1) The Director of Practice lifts the suspension after determining 
that the practitioner is no longer described in

[[Page 187]]

paragraph (b) of this section or for any other reason; or
    (2) The suspension is lifted by an Administrative Law Judge or the 
Secretary of the Treasury in a proceeding referred to in paragraph (g) 
of this section and instituted under Sec. 10.60.
    (g) Proceeding instituted under Sec. 10.60. If the Director of 
Practice suspends a practitioner under this section, the practitioner 
may ask the Director of Practice to issue a complaint under Sec. 10.60. 
The request must be made in writing within 2 years from the date on 
which the practitioner's suspension commences. The Director of Practice 
must issue a complaint requested under this paragraph within 30 calendar 
days of receiving the request.



                      Subpart E_General Provisions

    Source: T.D. 9011, 67 FR 48774, July 26, 2002, unless otherwise 
noted.



Sec. 10.90  Records.

    Availability. The Director of Practice will make available for 
public inspection at the Office of Director Practice the roster of all 
persons enrolled to practice, the roster of all persons censured, 
suspended, or disbarred from practice before the Internal Revenue 
Service, and the roster of all disqualified appraisers. Other records of 
the Director of Practice may be disclosed upon specific request, in 
accordance with the applicable disclosure rules of the Internal Revenue 
Service and the Treasury Department.



Sec. 10.91  Saving clause.

    Any proceeding instituted under regulations in effect prior to July 
26, 2002 that is not final prior to July 26, 2002 will not be affected 
by this part and will apply the rules set forth at 31 CFR part 10 
revised as of July 1, 2002. Any proceeding under this part based on 
conduct engaged in prior to July 26, 2002, which is instituted after 
that date, shall apply Subpart D and E of this part, but the conduct 
engaged in prior to July 26, 2002 shall be judged by the regulations in 
effect at the time the conduct occurred.



Sec. 10.92  Special orders.

    The Secretary of the Treasury reserves the power to issue such 
special orders as he or she deems proper in any cases within the purview 
of this part.



Sec. 10.93  Effective date.

    Except as otherwise provided in each section and subject to Sec. 
10.91, Part 10 is applicable on July 26, 2002.

[T.D. 9011, 67 FR 48771, July 26, 2002, as amended by T.D. 9165, 69 FR 
75845, Dec. 20, 2004]



PART 11_OPERATION OF VENDING FACILITIES BY THE BLIND ON FEDERAL PROPERTY 
UNDER THE CONTROL OF THE DEPARTMENT OF THE TREASURY--Table of Contents




Sec.
11.1 Purpose.
11.2 Policy.
11.3 Definitions.
11.4 Establishing vending facilities.
11.5 Application for permit.
11.6 Terms of permit.
11.7 Enforcement procedures.
11.8 Reports.

    Authority: 49 Stat. 1559, as amended by Act of Aug. 3, 1954, Pub. L. 
83-565, 68 Stat. 663, as further amended by Pub. L. 93-516, 88 Stat. 
1622, (20 U.S.C. 107).

    Source: 58 FR 57560, Oct. 26, 1993, unless otherwise noted.



Sec. 11.1  Purpose.

    This part contains policy and procedures to ensure the priority of 
blind vendors in operating vending facilities on property controlled by 
the Department of the Treasury. The provisions of this part apply to all 
bureaus, the Departmental Offices and the Office of Inspector General.



Sec. 11.2  Policy.

    Blind vendors licensed by State licensing agencies designated by the 
Secretary of Education under the provisions of the Randolph-Sheppard Act 
(20 U.S.C. 107 et seq.) shall be given priority in the location and 
operation of vending facilities, including vending machines, on property 
controlled by the Department of the Treasury, provided the location or 
operation of such facility would not adversely affect the

[[Page 188]]

interests of the United States. Treasury bureaus shall ensure that the 
collection and distribution of vending machine income from vending 
machines on Treasury-controlled property shall be in compliance with the 
regulations set forth in 34 CFR 395.32. Blind vendors shall also be 
given priority on Treasury-controlled property in the operation of 
cafeterias according to 34 CFR 395.33.



Sec. 11.3  Definitions.

    Terms used are defined in 34 CFR 395.1, except that as used in this 
part, the following terms shall have the following meanings:
    (a) Department of the Treasury controlled property means any Federal 
building, land, or other real property owned, leased, or occupied by a 
bureau or office of the Department of the Treasury, of which the 
maintenance, operation, and protection is under the control of the 
Department of the Treasury.
    (b) The term bureau means any bureau or office of the Department of 
the Treasury and such comparable administrative units as may hereafter 
be created or made a part of the Department, and includes the 
Departmental Offices and the Office of Inspector General. The ``head of 
the bureau'' for the Departmental Offices is the Deputy Assistant 
Secretary (Administration).



Sec. 11.4  Establishing vending facilities.

    (a) Treasury bureaus shall not acquire a building by ownership, 
rent, or lease, or occupy a building to be constructed, substantially 
altered, or renovated unless it is determined that such buildings 
contain or will contain a ``satisfactory site,'' as defined in 34 CFR 
395.1(q), for the location and operation of a blind vending facility.
    (b) In accordance with 34 CFR 395.31, Treasury bureaus shall provide 
the appropriate State licensing agency with written notice of the 
intention to acquire or otherwise occupy such building. Providing 
notification shall be the responsibility of the bureau on-site property 
management official.



Sec. 11.5  Application for permit.

    Applications for permits for the operation of vending facilities 
other than cafeterias shall be made in writing and submitted for the 
review and approval of the head of the appropriate Treasury bureau or 
that official's designee.



Sec. 11.6  Terms of permit.

    Every permit shall describe the location of the vending facility, 
including any vending machines located on other than facility premises, 
and shall be subject to the following provisions:
    (a) The permit shall be issued in the name of the applicant State 
licensing agency which shall perform the responsibilities set forth in 
34 CFR 395.35 (a);
    (b) The permit shall be issued for an indefinite period of time 
subject to suspension or termination on the basis of compliance or 
noncompliance with agreed upon terms.
    (c) The permit shall provide that:
    (1) No charge shall be made to the State licensing agency for normal 
cleaning, maintenance, and repair of the building structure in and 
adjacent to the vending facility areas;
    (2) Cleaning necessary for sanitation; the maintenance of vending 
facilities and vending machines in an orderly condition at all times; 
the installation, maintenance, repair, replacement, servicing, and 
removal of vending facility equipment shall be without cost to the 
Department of the Treasury; and
    (3) Articles sold at vending facilities operated by blind licensees 
may consist of newspapers, periodicals, publications, confections, 
tobacco products, foods, beverages, chances for any lottery authorized 
by State law and conducted by an agency of a State within such State, 
and other articles or services as are determined by the State licensing 
agency, in consultation with the appropriate Treasury bureau, to be 
suitable for a particular location. Such articles and services may be 
dispensed automatically or manually and may be prepared on or off the 
premises.
    (d) The permit shall further provide that vending facilities shall 
be operated in compliance with applicable health, sanitation, and 
building codes or ordinances.
    (e) The permit shall further provide that installation, 
modification, relocation, removal, and renovation of vending facilities 
shall be subject to the prior approval and supervision of the

[[Page 189]]

bureau on-site property management officer of the appropriate Treasury 
bureau and the State licensing agency; that costs of relocations 
initiated by the State licensing agency shall be paid by the State 
licensing agency; that costs of relocations initiated by a Treasury 
bureau shall be paid by the Treasury bureau; and that all plumbing, 
electrical, and mechanical costs related to the renovation of existing 
facilities shall be paid by the appropriate Treasury bureau.
    (f) The operation of a cafeteria by a blind vendor shall be covered 
by a contractual agreement and not by a permit. The State licensing 
agency shall be expected to perform under the same contractual 
arrangement applicable to commercial cafeteria operators.



Sec. 11.7  Enforcement procedures.

    (a) The State licensing agency shall attempt to resolve day-to-day 
problems pertaining to the operation of the vending facility in an 
informal manner with the participation of the blind vendor and the on-
site property management officials of the respective Treasury bureaus 
who are responsible for the Treasury-controlled property.
    (b) Unresolved disagreements concerning the terms of the permit, the 
Act, or the regulations in this part and any other unresolved matters 
shall be reported in writing to the State licensing agency supervisory 
personnel by the bureau on-site supervisory property management official 
in an attempt to resolve the issue.



Sec. 11.8  Reports.

    This section establishes a Department of the Treasury reporting 
requirement to comply with 34 CFR 395.38. At the end of each fiscal 
year, each property managing bureau shall submit a report to the 
Director, Office of Management Support Systems, Departmental Offices, 
containing the elements set forth in 34 CFR 395.38. The Director, Office 
of Management Support Systems, shall submit a consolidated report to the 
Secretary of Education after the end of the fiscal year.



PART 12_RESTRICTION OF SALE AND DISTRIBUTION OF TOBACCO PRODUCTS
--Table of Contents




Sec.
12.1 Purpose.
12.2 Definitions.
12.3 Sale of tobacco products in vending machines prohibited.
12.4 Distribution of free samples of tobacco products prohibited.
12.5 Prohibitions not applicable in areas designated by the Secretary of 
          the Treasury.

    Authority: Sec. 636, Pub. L. 104-52, 109 Stat. 507.

    Source: 61 FR 25396, May 21, 1996, unless otherwise noted.



Sec. 12.1  Purpose.

    This part contains regulations implementing the ``Prohibition of 
Cigarette Sales to Minors in Federal Buildings Act,'' Public Law 104-52, 
Section 636, with respect to buildings under the jurisdiction of the 
Department of the Treasury.



Sec. 12.2  Definitions.

    As used in this part--
    (1) The term Federal building under the jurisdiction of the 
Secretary of the Treasury includes the real property on which such 
building is located;
    (2) The term minor means an individual under the age of 18 years; 
and
    (3) The term tobacco product means cigarettes, cigars, little 
cigars, pipe tobacco, smokeless tobacco, snuff, and chewing tobacco.



Sec. 12.3  Sale of tobacco products in vending machines prohibited.

    The sale of tobacco products in vending machines located in or 
around any Federal building under the jurisdiction of the Secretary of 
the Treasury is prohibited, except in areas designated pursuant to Sec. 
12.5 of this part.



Sec. 12.4  Distribution of free samples of tobacco products prohibited.

    The distribution of free samples of tobacco products in or around 
any Federal building under the jurisdiction of the Secretary of the 
Treasury is prohibited, except in areas designated pursuant to Sec. 
12.5 of this part.

[[Page 190]]



Sec. 12.5  Prohibitions not applicable in areas designated by the 
Secretary of the Treasury.

    The prohibitions set forth in this part shall not apply in areas 
designated by the Secretary as exempt from the prohibitions, but all 
designated areas must prohibit the presence of minors.



PART 13_PROCEDURES FOR PROVIDING ASSISTANCE TO STATE AND LOCAL GOVERNMENTS 
IN PROTECTING FOREIGN DIPLOMATIC MISSIONS--Table of Contents




Sec.
13.1 Purpose.
13.2 Definitions.
13.3 Eligibility to receive protection or reimbursement.
13.4 Requests for protection and advance notices of reimbursement 
          requests.
13.5 Utilization of the services, personnel, equipment, and facilities 
          of State and local govenments.
13.6 Reimbursement of State and local governments.
13.7 Reimbursement when the Assistant Secretary makes no determination 
          to utilize State and local government services, personnel, 
          equipment and facilities.
13.8 Protection for motorcades and other places associated with a visit 
          qualifying under section 202(7) of Title 3, U.S. Code.

Appendix I(F) to Part 13--Estimated Overhead and Administrative Costs
Appendix II(F) to Part 13--Overhead and Administrative Costs
Appendix I to Part 13--Form of Request for Assistance
Appendix II to Part 13--Form of Bill for Reimbursement

    Authority: Secs. 202 and 208, Title 3, U.S. Code, as amended and 
added, respectively by Pub. L. 94-196 (89 Stat. 1109); 5 U.S.C. 301.

    Source: 41 FR 55179, Dec. 17, 1976, unless otherwise noted.



Sec. 13.1  Purpose.

    This part prescribes the procedures governing protective and 
financial assistance to State and local governments when an 
extraordinary protective need requires the protection of foreign 
diplomatic missions as authorized by sections 202 and 208 of Title 3, 
U.S. Code, as amended and added, respectively, by Pub. L. 94-196 (89 
Stat. 1109).



Sec. 13.2  Definitions.

    As used in this part, these terms shall have the following meaning:
    (a) The term Assistant Secretary means the Assistant Secretary of 
the Treasury (Enforcement and Operations).
    (b) The term extraordinary protective need means a need for 
protection requiring measurable reinforcements of police personnel or 
equipment, or both, significantly beyond the ordinary deployment of the 
State or local government, arising out of actual or potential violence 
related to: (1) Confrontations between nationalist or other groups, (2) 
threats or acts of violence by terrorist or other groups, (3) a specific 
diplomatic event or visit, or (4) a specific international event.
    (c) The term foreign diplomatic mission means a mission (including 
foreign consular offices) of a foreign country located in the United 
States.
    (d) The term full time officers means permanent officers whose 
duties as foreign diplomatic officers occupy their full time.
    (e) The term international organization means those international 
organizations designated by Presidential Executive Order as being 
entitled to the privileges, immunities, and exemptions accorded under 
the International Organization Immunities Act of December 29, 1945 (22 
U.S.C. 288).
    (f) The term metropolitan area means a city in the United States 
(other than the District of Columbia) and those areas contiguous to it.
    (g) The term observer mission means a mission invited to participate 
in the work of an international organization by that organization. The 
invitation to participate shall be extended by the international 
organization pursuant to the same internal rules of the international 
organization as are applicable to any permanent mission.
    (h) The term permanent mission means a fixed continuing mission 
staffed by full time officers and maintained by a member state of an 
international organization.
    (i) The term temporary domicile means a domicile of limited duration 
of a visiting foreign dignitary or officer in connection with a visit to 
a permanent

[[Page 191]]

or observer mission to an international organization in a metropolitan 
area.

[41 FR 55179, Dec. 17, 1976, as amended at 45 FR 30621, May 9, 1980]



Sec. 13.3  Eligibility to receive protection or reimbursement.

    (a) Protection, as determined by the Assistant Secretary, will be 
provided by the United States Secret Service Uniformed Division, 
pursuant to section 202 of Title 3, U.S. Code, as amended by Pub. L. 94-
196, only to foreign diplomatic missions located in metropolitan areas 
(other than the District of Columbia) where there are located twenty or 
more such missions, as determined by the Secretary of State, which are 
headed by full time officers. According to present State Department 
figures, the following metropolitan areas have 20 or more such foreign 
diplomatic missions: Chicago, Houston, Los Angeles, Miami, New York 
City, New Orleans and San Francisco. The protection provided by State or 
local governments rather than the United States Secret Service Uniformed 
Division will be reimbursed pursuant to section 208(a) of Title 3, U.S. 
Code and Sec. Sec. 13.6, 13.7 and 13.8 of this part.
    (b) Protection or reimbursement will be provided for the 
metropolitan areas described in paragraph (a) of this section only if:
    (1) The affected metropolitan area requests such protection or 
reimbursement;
    (2) The Assistant Secretary determines that an extraordinary 
protective need exists; and
    (3) The extraordinary need arises in association with a visit to or 
occurs at or, pursuant to Sec. 13.6, in the vicinity of: (i) A 
permanent mission to an international organization of which the United 
States is a member, (ii) an observer mission invited to participate in 
the work of an international organization of which the United States is 
a member, or (iii) in the case of a visit by a foreign official or 
dignitary to participate in an activity of an international organization 
of which the United States is a member, a foreign diplomatic mission, 
including a consular office of the same country as the visitor.
    (c) Protection (or reimbursement) may be extended at places of 
temporary domicile in connection with a visit under paragraph (b) of 
this section.
    (d) Where an extraordinary protective need exists, protection (or 
reimbursement) may be extended to missions as described in Sec. Sec. 
13.3(b)(3) (i) and (ii) whether or not associated with a visit by a 
foreign dignitary.

[45 FR 30621, May 9, 1980]



Sec. 13.4  Requests for protection and advance notices of reimbursement 
requests.

    (a) In cases where they believe that an extraordinary protective 
need exists, the State or local governments may request that protection 
be provided by the United States Secret Service Uniformed Division; or 
they may give advance notice of their intention to provide, on a 
reimbursable basis, all or part of the protection themselves.
    (1) Requests for protection or advance notices of reimbursement 
requests shall be made to: Assistant Secretary (Enforcement and 
Operations), Department of the Treasury, Washington, DC 20220. Each 
government requesting the protection authorized pursuant to section 202 
of Title 3, U.S. Code, as amended by Pub. L. 94-196, or which intends to 
seek reimbursement pursuant to section 208(a) of Title 3, U.S. Code and 
Sec. Sec. 13.6 and 13.7 of this part, shall submit an application 
describing the extraordinary protective need. Applications made pursuant 
to this section shall be submitted to the Assistant Secretary 14 days 
before the extraordinary protective need arises. In association with a 
visit, the application shall include the name and title of the visiting 
foreign official or dignitary, the country he represents, and the name 
and location of the international organization or mission he will be 
visting. The application shall also include, if available, the temporary 
domicile of the visiting official or dignitary and his schedule, 
including dates and times of arrival and departure from the United 
States. If the extraordinary protective need occurs at a permanent 
mission to an international organization of which the

[[Page 192]]

United States is a member or an observer mission invited to participate 
in the work of such organization, or if another foreign diplomatic 
mission of the country qualifies under Sec. 13.3 (b) or (d), the 
application shall include the name and location of the mission.
    (b) State and local governments shall also indicate on the 
application whether they are requesting the use of the United States 
Secret Service Uniformed Division or whether they are giving advance 
notice of their intention to provide, on a reimbursable basis, all or 
part of the protection themselves. In order to assist the Assistant 
Secretary in determining whether to utilize the United States Secret 
Service Uniformed Division to meet all or part of the extraordinary 
protective need, or to utilize, with their consent, the services, 
personnel, equipment, and facilities of the State or local government, 
or both, the application must include an estimate of the approximate 
number of personnel by grade and rank, the services, equipment, and 
facilities required, along with an estimate of the cost of such 
personnel, services, equipment and facilities. This application must be 
submitted in a format consistent with that illustrated in Appendix I of 
this part.
    (1) Upon receipt of a request for protection pursuant to paragraph 
(a)(1) of this section and for the purposes of reimbursement pursuant to 
Sec. Sec. 13.6 and 13.7, the Assistant Secretary will determine whether 
an extraordinary protective need exists and whether the United States 
Secret Service Uniformed Division will be used for all, part or none of 
the protection. In making determinations, the Assistant Secretary may 
consult with appropriate Federal, State and local government agencies.

[45 FR 30621, May 9, 1980]



Sec. 13.5  Utilization of the services, personnel, equipment, and 
facilities of State and local governments.

    The Assistant Secretary may decide to utilize, on a reimbursable 
basis, the services, personnel, equipment, and facilities of State and 
local governments of the affected metropolitan area desiring to provide 
protection, or he may utilize the United States Secret Service Uniformed 
Division, or both. If the United States Secret Service Uniformed 
Division is utilized to meet all the extraordinary protective need, the 
governments of the affected metropolitan area will not be reimbursed. If 
the United States Secret Service Uniformed Division is utilized to meet 
part of the extraordinary protective needs, the governments of the 
affected metropolitan area will be reimbursed for that qualifying 
portion of the protection which is provided by State and local police 
authorities. If the Assistant Secretary decides to utilize, with their 
consent, the services, personnel, equipment, and facilities of such 
State and local governments to meet the extraordinary protective need, 
he will so notify the government as soon as possible after receipt of a 
request for protection or an advance notice of a reimbursement request 
made pursuant to Sec. 13.4.

[45 FR 30622, May 9, 1980]



Sec. 13.6  Reimbursement of State and local governments.

    (a) State and local governments providing services, personnel, 
equipment, or facilities to the affected metropolitan area pursuant to 
Sec. 13.5 may forward to the Assistant Secretary a bill for 
reimbursement for the personel, equipment, facilities, and services 
utilized in meeting the extraordinary protective need. The bill shall be 
in accordance with the format in Appendix II of this part. The Assistant 
Secretary will reimburse only those costs directly related to the 
extraordinary protective need including personnel and equipment costs 
resulting from assignments made to assist in providing security at an 
otherwise qualified location in connection with the arrival, departure, 
or during the visit of a foreign dignitary. Reimbursable costs will also 
include the costs for establishing both fixed posts at a qualified 
location and protective perimeters outside of a qualified location when 
it is clearly established to the satisfaction of the Assistant Secretary 
that such assignments were necessary to assure the safety of the 
qualified location. Overhead and administrative costs associated with an 
extraordinary protective need are

[[Page 193]]

reimbursable as either a flat 18 percent of the total extraordinary 
protective need costs, or, if such costs can be clearly segregated from 
routine police costs, on a dollar-for-dollar basis. The jurisdiction 
seeking such reimbursement may select either method but may not use 
both. For the purposes of reimbursement the Assistant Secretary will, in 
all cases, determine when the extraordinary protective need began and 
terminated.

[45 FR 30622, May 9, 1980]



Sec. 13.7  Reimbursement when the Assistant Secretary makes no 

determination to utilize State and local government services, 
personnel, equipment and 
          facilities.

    (a) Where events require the State or local governments of the 
affected metropolitan area to provide protection to meet an 
extraordinary protective need otherwise qualifying for reimbursement, 
such reimbursement may be made even if the provisions of Sec. Sec. 13.4 
and 13.5 have not been complied with fully. In such circumstances the 
provisions of Sec. 13.6 shall apply.
    (b) In cases where State or local governments, or both, utilized 
their own services, personnel, equipment, and facilities to provide 
protection for an extraordinary protective need, and no request for 
protective assistance pursuant to Sec. 13.4 was made because the 
extraordinary protective need occurred prior to the promulgation of this 
part but after July 1, 1974, an application by such government to the 
Assistant Secretary for reimbursement otherwise conforming to the 
requirements of this part will be considered.

[41 FR 55179, Dec. 17, 1976, as amended at 45 FR 30622, May 9, 1980]



Sec. 13.8  Protection for motorcades and other places associated with 
a visit qualifying under section 202(7) of Title 3, U.S. Code.

    (a) State and local governments furnishing services, personnel, 
equipment, and facilities to provide protection for motorcades and at 
other places associated with a visit qualifying under section 202(7) of 
Title 3, U.S. Code may forward to the Assistant Secretary a bill for 
reimbursement for the personnel, equipment, facilities, and services 
utilized in providing such protection.
    (b) Requests for payments under this section shall conform to the 
procedures established elsewhere in this part governing reimbursements 
arising out of an extraordinary protective need.

[45 FR 30622, May 9, 1980]

  Appendix I(F) to Part 13--Estimated Overhead and Administrative Costs

Date:___________________________________________________________________

                         Select Only One Method

    ------ 1. Reimbursement for overhead and administrative costs will 
be requested as a flat 18 percent of the total extraordinary protective 
need cost as provided in section 13.6 of these regulations.
    ------ 2. Reimbursement for overhead and administrative costs will 
be requested on a dollar-for-dollar basis. Computation of these costs 
will be made using the below described method:

(Explain in detail how all of these costs can be directly and 
exclusively attributed to the extraordinary protective need.)

[45 FR 30622, May 9, 1980]

      Appendix II(F) to Part 13--Overhead and Administrative Costs

Date:___________________________________________________________________

                         Select Only One Method

    ------ 1. Reimbursement for overhead and administrative costs is 
requested as a flat 18 percent of the total extraordinary protective 
need costs as provided in section 13.6 of these regulations.
    ------ 2. Reimbursement for overhead and administrative costs is 
requested on a dollar-for-dollar basis. Computation of these costs has 
been made using the below described method:

(Explain and show in detail how all of these costs have been directly 
and exclusively attributed extraordinary protective need costs).

Dated:__________________________________________________________________

[45 FR 30622, May 9, 1980]

          Appendix I to Part 13--Form of Request for Assistance

    I hereby request assistance from the Department of the Treasury 
pursuant to Section 202 of Title 3, U.S. Code, as amended by Pub. L. 94-
196. This assistance is needed to enable the affected metropolitan area 
of

[[Page 194]]

------------ to meet an extraordinary protective need, which is expected 
to arise on ------------ (date).
    The nature of the extraordinary protective need prompting this 
request is as follows:
    (If in association with a visit, include the name and title of the 
visiting foreign official or dignitary, the country represented and the 
name and location of the international organization involved and/or 
mission to be visited. The temporary domicile of the visiting official 
or dignitary and his schedule, including dates and times of arrival and 
departure from the United States, if available, must also be included. 
If the extraordinary protective need occurs at or, pursuant to Sec. 
13.6 of 31 CFR part 13, in the vicinity of, a permanent mission to an 
international organization of which the United States is a member or at 
an observer mission invited to participate in the work of the 
organization, the application shall include the name and location of the 
mission. If the extraordinary protective need occurs at a foreign 
diplomatic mission, including a consular office, in conjunction with a 
qualifying visit by a foreign official or dignitary of the same country 
as that mission, the application shall include the name and location of 
the mission or office. If, pursuant to Sec. 13.8, the visiting foreign 
official is to travel by motorcade and/or visit locations other than his 
foreign mission or temporary domicile, the application shall include a 
description of the anticipated motorcade routes and all stops on the 
routes as well as the name (or description) and location of any other 
places to be visited.
    The ------------ (Government entity) ------------ (is or is not) --
---------- prepared to provide ------------ (all or a portion of) the 
protection required to meet this need. Attached is an estimate of the 
appropriate number of personnel, by grade and rank, and the specific 
services, equipment and facilities which will be required to meet this 
extraordinary protective need, along with an estimate of the cost of 
such personnel, services, equipment, and facilities.
(Date)__________________________________________________________________
________________________________________________________________________
(State or local government of the affected metropolitan area)
________________________________________________________________________
(Signature)
________________________________________________________________________
(Title)

[45 FR 30622, May 9, 1980]

         Appendix II to Part 13--Form of Bill for Reimbursement

    I hereby request that ------------ (Governmental entity) be 
reimbursed by the Department of the Treasury pursuant to sections 202 
and 208 of Title 3, U.S. Code, as amended and added, respectively, by 
Public Law 94-196 (89 Stat. 1109) (and/or pursuant to Public Law 96-74) 
for expenses incurred while providing an adequate level of protection 
during the extraordinary protective need arising in association with a 
visit of ------------ (Official or dignitary's name and title) of ------
------ (Country) to participate in the work of ------------ 
(International Organization) or occurring at the -------------- 
(Permanent or observer mission) to ------------ (International 
organization) during the period ------------ (Date) through ------------ 
(Date).
    I certify that the level of protection provided was both reasonable 
and necessary; that the costs herein billed are only those direct costs 
associated with meeting the extraordinary protective need; and that the 
costs herein billed are not costs of an indirect nature such as 
administrative costs, overhead, and depreciation, except as provided in 
Sec. 13.6(a) of 31 CFR 13.
    Access to all records, accounts, receipts, etc., pertaining to the 
costs herein billed will be accorded to representatives of the Assistant 
Secretary (Enforcement and Operations) and the General Accounting Office 
at such reasonable times and places as may be mutually agreed upon by 
said representatives and ------------ (Governmental entity).
Date:___________________________________________________________________
________________________________________________________________________
(Signature)
________________________________________________________________________
(Title)

[45 FR 30623, May 9, 1980]



PART 14_RIGHT TO FINANCIAL PRIVACY ACT--Table of Contents




Sec.
14.1 Definitions.
14.2 Purpose.
14.3 Authorization.
14.4 Contents of request.
14.5 Certification.

    Authority: Sec. 1108, Right to Financial Privacy Act of 1978, 92 
Stat. 3697 et seq., 12 U.S.C. 3401 et seq.; (5 U.S.C. 301); and 
Reorganization Plan No. 26 of 1950.

    Source: 44 FR 16909, Mar. 20, 1979, unless otherwise noted.



Sec. 14.1  Definitions.

    For purposes of this regulation, the term:
    (a) Financial institution means any office of a bank, savings bank, 
card issuer as defined in section 103 of the Consumer Credit Protection 
Act (15 U.S.C. 1602(n)), industrial loan company, trust company, savings 
and loan,

[[Page 195]]

building and loan, or homestead association (including cooperative 
bank), credit union, or consumer financial institution, located in any 
State or territory of the United States, the District of Columbia, 
Puerto Rico, Guam, American Samoa, or the Virgin Islands.
    (b) Financial record means an original of, a copy of, or information 
known to have been derived from, any record held by a financial 
institution pertaining to a customer's relationship with the financial 
institution.
    (c) Person means an individual or a partnership of five or fewer 
individuals.
    (d) Customer means any person or authorized representative of that 
person who utilized or is utilizing any service of a financial 
institution, or for whom a financial institution is acting or has acted 
as a fiduciary, in relation to an account maintained in the person's 
name.
    (e) Law enforcement inquiry means a lawful investigation or official 
proceeding inquiring into a violation of or failure to comply with any 
criminal or civil statute or any regulation, rule, or order issued 
pursuant thereto.
    (f) Departmental unit means those offices, divisions, bureaus, or 
other components of the Department of the treasury authorized to conduct 
law enforcement inquiries.
    (g) Act means the Right to Financial Privacy Act of 1978.



Sec. 14.2  Purpose.

    The purpose of these regulations is to authorize Departmental units 
to request financial records from a financial institution pursuant to 
the formal written request procedure authorized by section 1108 of the 
Act, and to set forth the conditions under which such requests may be 
made.



Sec. 14.3  Authorization.

    Departmental units are hereby authorized to request financial 
records of any customer from a financial institution pursuant to a 
formal written request under the Act only if:
    (a) No administrative summons or subpoena authority reasonably 
appears to be available to the Departmental unit to obtain financial 
records for the purpose for which the records are sought;
    (b) There is reason to believe that the records sought are relevant 
to a legitimate law enforcement inquiry and will further that inquiry;
    (c) The request is issued by a supervisory official of a rank 
designated by the head of the requesting Departmental unit. Officials so 
designated shall not delegate this authority to others;
    (d) The request adheres to the requirements set forth in Sec. 14.4; 
and
    (e) The notice requirements set forth in section 1108(4) of the Act, 
or the requirements pertaining to delay of notice in section 1109 of the 
Act are satisfied, except in situations where no notice is required. 
(e.g., section 1113(g))



Sec. 14.4  Contents of request.

    The formal written request shall be in the form of a letter or 
memorandum to an appropriate official of the financial institution from 
which financial records are requested. The request shall be signed by an 
issuing official of the requesting Department unit. It shall set forth 
that official's name, title, business address and business phone number. 
The request shall also contain the following:
    (a) The identity of the customer or customers to whom the records 
pertain;
    (b) A reasonable description of the records sought;
    (c) Any other information that the issuing official deems 
appropriate, e.g., the date on which the requesting Departmental unit 
expects to present a certificate of compliance with the applicable 
provisions of the Act, the name and title of the individual to whom 
disclosure is to be made, etc.

In cases where customer notice is delayed by a court order, a copy of 
the court order shall be attached to the formal written request.



Sec. 14.5  Certification.

    Prior to obtaining the requested records pursuant to a formal 
written request, an official of a rank designated by the head of the 
requesting Departmental unit shall certify in writing to the financial 
institution

[[Page 196]]

that the Departmental unit has complied with the applicable provisions 
of the Act.



PART 15_POST EMPLOYMENT CONFLICT OF INTEREST--Table of Contents




                      Subpart A_General Provisions

Sec.
15.737-1 Scope.
15.737-2 Definitions.
15.737-3 Director of Practice.
15.737-4 Other discipline.
15.737-5 Records.

 Subpart B_Rules Applicable to Post Employment Practice by Officers and 
                       Employees of the Department

15.737-6 Interpretative standards.

            Subpart C_Administrative Enforcement Proceedings

15.737-7 Authority to prohibit practice.
15.737-8 Special orders.
15.737-9 Receipt of information concerning former Treasury employee.
15.737-10 Conferences.
15.737-11 Institution of proceeding.
15.737-12 Contents of complaint.
15.737-13 Service of complaint and other papers.
15.737-14 Answer.
15.737-15 Reply to answer.
15.737-16 Proof; variance; amendment of pleadings.
15.737-17 Motions and requests.
15.737-18 Representation.
15.737-19 Administrative Law Judge.
15.737-20 Hearings.
15.737-21 Evidence.
15.737-22 Depositions.
15.737-23 Transcript.
15.737-24 Proposed findings and conclusions.
15.737-25 Decision of the Administrative Law Judge.
15.737-26 Appeal to the General Counsel.
15.737-27 Decision of the General Counsel.
15.737-28 Notice of disciplinary action.

                Subpart D_Other Departmental Proceedings

15.737-29 Review by the General Counsel.

    Authority: 92 Stat. 1864 (18 U.S.C. 207), as amended.

    Source: 45 FR 39842, June 12, 1980, unless otherwise noted.



                      Subpart A_General Provisions



Sec. 15.737-1  Scope.

    This part contains rules governing discipline of a former officer or 
employee of the Department of the Treasury because of a post employment 
conflict of interest. Such discipline may include prohibition from 
practice before the Department or a separate statutory agency thereof as 
those terms are defined in this part.



Sec. 15.737-2  Definitions.

    For the purpose of this part--(a) The term Department means the 
Department of the Treasury and includes the separate statutory agencies 
thereof.
    (b) The term Director means the Director of Practice.
    (c) The term General Counsel means the General Counsel of the 
Department.
    (d) The term practice means any informal or formal appearance 
before, or, with the intent to influence, any oral or written 
communication to the Department or, where applicable, to a separate 
statutory agency thereof on a pending matter of business on behalf of 
any other person (except the United States).
    (e) The term separate statutory agency thereof means an agency or 
bureau within the Department designated by rule by the Director, Office 
of Government Ethics, as a separate agency or bureau. The Internal 
Revenue Service, Bureau of Alcohol, Tobacco and Firearms, United States 
Secret Service, Bureau of the Mint, United States Customs Service, 
Bureau of Engraving and Printing, and Comptroller of the Currency were 
so designated effective July 1, 1979.



Sec. 15.737-3  Director of Practice.

    There is, in the Office of the Secretary of the Treasury, the Office 
of Director of Practice. The Director shall institute and provide for 
the conduct of disciplinary proceedings involving former employees of 
the Department as authorized by 18 U.S.C. 207(j), and perform such other 
duties as are necessary or appropriate to carry out his/her functions 
under this part.

[[Page 197]]



Sec. 15.737-4  Other discipline.

    For activity alleged to violate 18 U.S.C. 207 (a), (b) or (c), the 
Director may also bring a disciplinary proceeding pursuant to the 
regulations governing practice before the Bureau of Alcohol, Tobacco and 
Firearms or the Internal Revenue Service as found in 31 CFR part 8 and 
31 CFR part 10, respectively. Such proceeding may be consolidated with 
any proceeding brought pursuant to this part.



Sec. 15.737-5  Records.

    There are made available to public inspection at the Office of 
Director of Practice the roster of all persons prohibited from practice 
before the Department. Other records may be disclosed upon specific 
request, in accordance with appropriate disclosure regulations of the 
Department.



 Subpart B_Rules Applicable to Post Employment Practice by Officers and 
                       Employees of the Department



Sec. 15.737-6  Interpretative standards.

    A determination that a former officer or employee of the Department 
violated 18 U.S.C. 207 (a), (b) or (c) will be made in conformance with 
the standards established in the interpretative regulations promulgated 
by the Office of Government Ethics and published at 5 CFR part 737.



            Subpart C_Administrative Enforcement Proceedings



Sec. 15.737-7  Authority to prohibit practice.

    Pursuant to 18 U.S.C. 207(j), if the General Counsel finds, after 
notice and opportunity for a hearing, that a former officer or employee 
of the Department violated 18 U.S.C. 207 (a), (b) or (c), the General 
Counsel in his/her discretion may prohibit that person from engaging in 
practice before the Department or a separate statutory agency thereof 
for a period not to exceed five years, or may take other appropriate 
disciplinary action.



Sec. 15.737-8  Special orders.

    The General Counsel may issue special orders as he/she may consider 
proper in any case within the purview of this part.



Sec. 15.737-9  Receipt of information concerning former Treasury employee.

    If an officer or employee of the Department has reason to believe 
that a former officer or employee of the Department has violated 18 
U.S.C. 207 (a), (b) or (c), or if any such officer or employee receives 
information to that effect, he/she shall promptly make a written report 
thereof, which report or a copy thereof shall be forwarded to the 
Inspector General, Department of the Treasury. If any other person has 
information of such violations, he/she may make a report thereof to the 
Inspector General or to any officer or employee of the Department. The 
Inspector General shall refer any information he/she deems warranted to 
the Director.



Sec. 15.737-10  Conferences.

    (a) In general. The Director may confer with a former officer or 
employee concerning allegations of misconduct irrespective of whether an 
administrative disciplinary proceeding has been instituted against him/
her. If such conference results in a stipulation in connection with a 
proceeding in which such person is the respondent, the stipulation may 
be entered in the record at the instance of either party to the 
proceeding.
    (b) Voluntary suspension. A former officer or employee, in order to 
avoid the institution or conclusion of a proceeding, may offer his/her 
consent to suspension from practice before the Department or a separate 
statutory agency thereof. The Director in his/her discretion, may 
suspend a former officer or employee in accordance with the consent 
offered.



Sec. 15.737-11  Institution of proceeding.

    (a) Whenever the Director has reason to believe that any former 
officer or employee of the Department has violated 18 U.S.C. 207 (a), 
(b) or (c), he/she may reprimand such person or institute an 
administrative disciplinary proceeding for that person's suspension

[[Page 198]]

from practice before the Department or a separate statutory agency 
thereof. The proceeding shall be instituted by a complaint which names 
the respondent and is signed by the Director and filed in his/her 
office. Except in cases of willfulness, or where time, the nature of the 
proceeding, or the public interest does not permit, a proceeding will 
not be instituted under this section until facts or conduct which may 
warrant such action have been called to the attention of the proposed 
respondent in writing and he/she has been accorded the opportunity to 
provide his/her position on the matter.
    (b) The Director shall coordinate proceedings under this part with 
the Department of Justice in cases where it initiates criminal 
prosecution.



Sec. 15.737-12  Contents of complaint.

    (a) Charges. A complaint shall give a plain and concise description 
of the allegations which constitute the basis for the proceeding. A 
complaint shall be deemed sufficient if it fairly informs the respondent 
of the charges against him/her so that the respondent is able to prepare 
a defense.
    (b) Demand for answer. In the complaint, or in a separate paper 
attached to the complaint, notification shall be given of the place and 
time within which the respondent shall file his/her answer, which time 
shall not be less than 15 days from the date of service of the 
complaint, and notice shall be given that a decision by default may be 
rendered against the respondent in the event he/she fails to file an 
answer as required.



Sec. 15.737-13  Service of complaint and other papers.

    (a) Complaint. The complaint or a copy thereof may be served upon 
the respondent by certified mail, or first-class mail as hereinafter 
provided; by delivering it to the respondent or his/her attorney or 
agent of record either in person or by leaving it at the office or place 
of business of the respondent, attorney or agent; or in any other manner 
which has been agreed to by the respondent. Where the service is by 
certified mail, the return post office receipt duly signed by or on 
behalf of the respondent shall be proof of service. If the certified 
mail is not claimed or accepted by the respondent and is returned 
undelivered, complete service may be made upon the respondent by mailing 
the complaint to him/her by first-class mail, addressed to him/her at 
the last address known to the Director. If service is made upon the 
respondent or his/her attorney or agent of record in person or by 
leaving the complaint at the office or place of business of the 
respondent, attorney or agent, the verified return by the person making 
service, setting forth the manner of service, shall be proof of such 
service.
    (b) Service of papers other than complaint. Any paper other than the 
complaint may be served upon a respondent as provided in paragraph (a) 
of this section or by mailing the paper by first-class mail to the 
respondent at the last address known to the Director, or by mailing the 
paper by first-class mail to the respondent's attorney or agent of 
record. Such mailing shall constitute complete service. Notices may be 
served upon the respondent or his/her attorney or agent of record by 
telegraph.
    (c) Filing of papers. Whenever the filing of a paper is required or 
permitted in connection with a proceeding, and the place of filing is 
not specified by this subpart or by rule or order of the Administrative 
Law Judge, the paper shall be filed with the Director of Practice, 
Department of the Treasury, Washington, DC 20220. All papers shall be 
filed in duplicate.



Sec. 15.737-14  Answer.

    (a) Filing. The respondent's answer shall be filed in writing within 
the time specified in the complaint, unless on application the time is 
extended by the Director or the Administrative Law Judge. The answer 
shall be filed in duplicate with the Director.
    (b) Contents. The answer shall contain a statement of facts which 
constitute the grounds of defense, and it shall specifically admit or 
deny each allegation set forth in the complaint, except that the 
respondent shall not deny a material allegation in the complaint which 
he/she knows to be true, or state that he/she is without sufficient 
information to form a belief when

[[Page 199]]

in fact he/she possesses such information. The respondent may also state 
affirmatively special matters of defense.
    (c) Failure to deny or answer allegations in the complaint. Every 
allegation in the complaint which is not denied in the answer shall be 
deemed to be admitted and may be considered as proved, and no further 
evidence in respect of such allegation need be adduced at a hearing. 
Failure to file an answer within the time prescribed in the notice to 
the respondent, except as the time for answer is extended by the 
Director or the Administrative Law Judge, shall constitute an admission 
of the allegations of the complaint and a waiver of hearing, and the 
Administrative Law Judge may make his/her decision by default without a 
hearing or further procedure.



Sec. 15.737-15  Reply to answer.

    No reply to the respondent's answer shall be required, and new 
matter in the answer shall be deemed to be denied, but the Director may 
file a reply in his/her discretion or at the request of the 
Administrative Law Judge.



Sec. 15.737-16  Proof; variance; amendment of pleadings.

    In the case of a variance between the allegations in a pleading and 
the evidence adduced in support of the pleading, the Administrative Law 
Judge may order or authorize amendment of the pleading to conform to the 
evidence: Provided, That the party who would otherwise be prejudiced by 
the amendment is given reasonable opportunity to meet the allegations of 
the pleading as amended; and the Administrative Law Judge shall make 
findings on any issue presented by the pleadings as so amended.



Sec. 15.737-17  Motions and requests.

    Motions and requests may be filed with the Director or with the 
Administrative Law Judge.



Sec. 15.737-18  Representation.

    A respondent or proposed respondent may appear in person or he/she 
may be represented by counsel or other representative. The Director may 
be represented by an attorney or other employee of the Department.



Sec. 15.737-19  Administrative Law Judge.

    (a) Appointment. An Administrative Law Judge appointed as provided 
by 5 U.S.C. 3105 (1966), shall conduct proceedings upon complaints for 
the administrative disciplinary proceedings under this part.
    (b) Power of Administrative Law Judge. Among other powers, the 
Administrative Law Judge shall have authority, in connection with any 
proceeding assigned or referred to him/her, to do the following:
    (1) Administer oaths and affirmations;
    (2) Make rulings upon motions and requests, which rulings may not be 
appealed from prior to the close of a hearing except, at the discretion 
of the Administrative Law Judge, in extraordinary circumstances;
    (3) Determine the time and place of hearing and regulate its course 
and conduct;
    (4) Adopt rules of procedure and modify the same from time to time 
as occasion requires for the orderly disposition of proceedings;
    (5) Rule upon offers of proof, receive relevant evidence, and 
examine witnesses;
    (6) Take or authorize the taking of depositions;
    (7) Receive and consider oral or written argument on facts or law;
    (8) Hold or provide for the holding of conferences for the 
settlement or simplification of the issues by consent of the parties;
    (9) Assess the responsible party extraordinary costs attributable to 
the location of a hearing;
    (10) Perform such acts and take such measures as are necessary or 
appropriate to the efficient conduct of any proceeding; and
    (11) Make initial decisions.



Sec. 15.737-20  Hearings.

    (a) In general. The Administrative Law Judge shall preside at the 
hearing on a complaint for the suspension of a former officer or 
employee from practice before the Department. Hearings shall be 
stenographically recorded and transcribed and the testimony of witnesses 
shall be taken under oath or affirmation. Hearings will be conducted 
pursuant to 5 U.S.C. 556.

[[Page 200]]

    (b) Public access to hearings. Hearings will be closed unless an 
open hearing is requested by the respondent, except that if classified 
information or protected information of third parties (such as tax 
information) is likely to be adduced at the hearing, it will remain 
closed. A request for an open hearing must be included in the answer to 
be considered.
    (c) Failure to appear. If either party to the proceeding fails to 
appear at the hearing, after due notice thereof has been sent to him/
her, he/she shall be deemed to have waived the right to a hearing and 
the Administrative Law Judge may make a decision against the absent 
party by default.



Sec. 15.737-21  Evidence.

    (a) In general. The rules of evidence prevailing in courts of law 
and equity are not controlling in hearings on complaints for the 
suspension of a former officer or employee from practice before the 
Department. However, the Administrative Law Judge shall exclude evidence 
which is irrelevant, immaterial, or unduly repetitious.
    (b) Depositions. The deposition of any witness taken pursuant to 
Sec. 15.737-22 of this part may be admitted.
    (c) Proof of documents. Official documents, records and papers of 
the Department shall be admissible in evidence without the production of 
an officer or employee to authenticate them. Any such documents, 
records, and papers may be evidenced by a copy attested or identified by 
an officer or employee of the Department.
    (d) Exhibits. If any document, record, or other paper is introduced 
in evidence as an exhibit, the Administrative Law Judge may authorize 
the withdrawal of the exhibit subject to any conditions which he/she 
deems proper.
    (e) Objections. Objections to evidence shall be in short form, 
stating the grounds of objection relied upon, and the record shall not 
include argument thereon, except as ordered by the Administrative Law 
Judge. Rulings on such objections shall be a part of the record. No 
exception to the ruling is necessary to preserve the rights of the 
parties.



Sec. 15.737-22  Depositions.

    Depositions for use at a hearing may, with the consent of the 
parties in writing or the written approval of the Administrative Law 
Judge, be taken by either the Director or the respondent or their duly 
authorized representatives. Depositions may be taken upon oral or 
written interrogatories, upon not less than 10 days' written notice to 
the other party before any officer duly authorized to administer an oath 
for general purposes or before an officer or employee of the Department 
who is authorized to administer an oath. Such notice shall state the 
names of the witnesses and the time and place where the depositions are 
to be taken. The requirement of 10 days' notice may be waived by the 
parties in writing, and depositions may then be taken from the persons 
and at the times and places mutually agreed to by the parties. When a 
deposition is taken upon written interrogatories, any cross-examination 
shall be upon written interrogatories. Copies of such written 
interrogatories shall be served upon the other party with the notice, 
and copies of any written cross-interrogation shall be mailed or 
delivered to the opposing party at least 5 days before the date of 
taking the depositions, unless the parties mutually agree otherwise. A 
party upon whose behalf a deposition is taken must file it with the 
Administrative Law Judge and serve one copy upon the opposing party. 
Expenses in the reporting of depositions shall be borne by the party at 
whose instance the deposition is taken.



Sec. 15.737-23  Transcript.

    In cases where the hearing is stenographically reported by a 
Government contract reporter, copies of the transcript may be obtained 
from the reporter at rates not to exceed the maximum rates fixed by 
contract between the Government and the reporter or from the Department 
at actual cost of duplication. Where the hearing is stenographically 
reported by a regular employee of the Department, a copy thereof will be 
supplied to the respondent either without charge or upon payment of a 
reasonable fee. Copies of exhibits introducted at the hearing or at

[[Page 201]]

the taking of depositions will be supplied to the parties upon the 
payment of a reasonable fee (Sec. 501, Pub. L. 82-137, 65 Stat. 290 (31 
U.S.C. 483a)).



Sec. 15.737-24  Proposed findings and conclusions.

    Except in cases where the respondent has failed to answer the 
complaint or where a party has failed to appear at the hearing, the 
Administrative Law Judge prior to making his/her decision, shall afford 
the parties a reasonable opportunity to submit proposed findings and 
conclusions and supporting reasons therefor.



Sec. 15.737-25  Decision of the Administrative Law Judge.

    As soon as practicable after the conclusion of a hearing and the 
receipt of any proposed findings and conclusions timely submitted by the 
parties, the Administrative Law Judge shall make the initial decision in 
the case. The decision shall include (a) a statement of findings and 
conclusions, as well as the reasons or basis therefor, upon all the 
material issues of fact, law, or discretion presented on the record, and 
(b) an order of suspension from practice before the Department or 
separate statutory agency thereof or other appropriate disciplinary 
action, or an order of dismissal of the complaint. The Administrative 
Law Judge shall file the decision with the Director and shall transmit a 
copy thereof to the respondent or his/her attorney of record. In the 
absence of an appeal to the General Counsel or review of the decision 
upon motion of the General Counsel, the decision of the Administrative 
Law Judge shall without further proceedings become the decision of the 
General Counsel 30 days from the date of the Administrative Law Judge's 
decision.



Sec. 15.737-26  Appeal to the General Counsel.

    Within 30 days from the date of the Administrative Law Judge's 
decision, either party may appeal to the General Counsel. The appeal 
shall be filed with the Director in duplicate and shall include 
exceptions to the decision of the Administrative Law Judge and 
supporting reasons for such exceptions. If an appeal is filed by the 
Director, he/she shall transmit a copy thereof to the respondent. Within 
30 days after receipt of an appeal or copy thereof, the other party may 
file a reply brief in duplicate with the Director. If the reply brief is 
filed by the Director, he/she shall transmit a copy of it to the 
respondent. Upon the filing of an appeal and a reply brief, if any, the 
Director shall transmit the entire record to the General Counsel.



Sec. 15.737-27  Decision of the General Counsel.

    On appeal from or review of the initial decision of the 
Administrative Law Judge, the General Counsel will make the agency 
decision. In making his/her decision, the General Counsel will review 
the record or such portions thereof as may be cited by the parties to 
permit limiting of the issues. A copy of the General Counsel's decision 
shall be transmitted to the respondent by the Director.



Sec. 15.737-28  Notice of disciplinary action.

    (a) Upon the issuance of a final order suspending a former officer 
or employee from practice before the Department or a separate statutory 
agency thereof, the Director shall give notice thereof to appropriate 
officers and employees of the Department. Officers and employees of the 
Department shall refuse to participate in any appearance by such former 
officer or employee or to accept any communication which constitutes the 
prohibited practice before the Department or separate statutory agency 
thereof during the period of suspension.
    (b) The Director shall take other appropriate disciplinary action as 
may be required by the final order.



                Subpart D_Other Departmental Proceedings



Sec. 15.737-29  Review by the General Counsel.

    In my proceeding before the Department, if an initial decision is 
made with respect to the disqualification of a representative or 
attorney for a party on the grounds of 18 U.S.C. 207(a), (b) or (c), 
such decision may be appealed to

[[Page 202]]

the General Counsel, who will make the agency decision on the issue.



PART 16_REGULATIONS IMPLEMENTING THE PROGRAM FRAUD CIVIL REMEDIES ACT 
OF 1986--Table of Contents




Sec.
16.1 Basis and purpose.
16.2 Definitions.
16.3 Basis for civil penalties and assessments.
16.4 Investigation.
16.5 Review by the reviewing official.
16.6 Prerequisites for issuing a complaint.
16.7 Complaint.
16.8 Service of complaint.
16.9 Answer.
16.10 Default upon failure to file an answer.
16.11 Referral of complaint and answer to the ALJ.
16.12 Notice of hearing.
16.13 Parties to the hearing.
16.14 Separation of functions.
16.15 Ex parte contacts.
16.16 Disqualification of reviewing official or ALJ.
16.17 Rights of parties.
16.18 Authority of the ALJ.
16.19 Prehearing conferences.
16.20 Disclosure of documents.
16.21 Discovery.
16.22 Exchange of witness lists, statements, and exhibits.
16.23 Subpoenas for attendance at hearing.
16.24 Protective order.
16.25 Fees.
16.26 Form, filing and service of papers.
16.27 Computation of time.
16.28 Motions.
16.29 Sanctions.
16.30 The hearing and burden of proof.
16.31 Determining the amount of penalties and assessments.
16.32 Location of hearing.
16.33 Witnesses.
16.34 Evidence.
16.35 The record.
16.36 Post-hearing briefs.
16.37 Initial decision.
16.38 Reconsideration of initial decision.
16.39 Appeal to authority head.
16.40 Stays ordered by the Department of Justice.
16.41 Stay pending appeal.
16.42 Judicial review.
16.43 Collection of civil penalties and assessments.
16.44 Right to administrative offset.
16.45 Deposit in Treasury of United States.
16.46 Compromise or settlement.
16.47 Limitations.

    Authority: 31 U.S.C. 3801-3812.

    Source: 52 FR 35071, Sept. 17, 1987, unless otherwise noted.



Sec. 16.1  Basis and purpose.

    (a) Basis. This part implements the Program Fraud Civil Remedies Act 
of 1986, Pub. L. 99-509, sections 6101-6104, 100 Stat. 1874 (October 21, 
1986), to be codified at 31 U.S.C. 3801-3812. 31 U.S.C. 3809 requires 
each authority head to promulgate regulations necessary to implement the 
provisions of the statute.
    (b) Purpose. This part
    (1) Establishes administrative procedures for imposing civil 
penalties and assessments against persons who make, submit, or present, 
or cause to be made, submitted, or presented, false, fictitious, or 
fraudulent claims or written statements to authorities or to their 
agents, and
    (2) Specifies the hearing and appeal rights of persons subject to 
allegations of liability for such penalties and assessments.



Sec. 16.2  Definitions.

    ALJ means an Administrative Law Judge in the authority appointed 
pursuant to 5 U.S.C. 3105 or detailed to the authority pursuant to 5 
U.S.C. 3344.
    Authority means the Department of the Treasury.
    Authority head means the Assistant Secretary of the Treasury for 
Management.
    Benefit, when used in the context of false statements made with 
respect to a benefit, means anything of value including but not limited 
to any advantage, preference, privilege, license, permit, favorable 
decision, ruling, status, or loan guarantee. This definition should be 
distinguished from the limitations on coverage of these regulations with 
respect to beneficiaries of specific benefit programs which are found in 
Sec. 16.3(c) of this part.
    Claim means any request, demand, or submission--
    (a) Made to the authority for property, services, or money 
(including money representing grants, loans, insurance, or benefits);
    (b) Made to a recipient of property, services, or money from the 
authority or to a party to a contract with the authority--
    (1) For property or services if the United States--

[[Page 203]]

    (i) Provided such property or services;
    (ii) Provided any portion of the funds for the purchase of such 
property or services; or
    (iii) Will reimburse such recipient or party for the purchase of 
such property or services; or
    (2) For the payment of money (including money representing grants, 
loans, insurance, or benefits) if the United States--
    (i) Provided any portion of the money requested or demanded; or
    (ii) Will reimburse such recipient or party for any portion of the 
money paid on such request or demand; or
    (c) Made to the authority which has the effect of decreasing an 
obligation to pay or account for property, services, or money, except 
that such term does not include any claim made in any return of tax 
imposed by the Internal Revenue Code of 1954.
    Complaint means the administrative complaint served by the reviewing 
official on the defendant under Sec. 16.7 of this part.
    Defendant means any person alleged in a complaint under Sec. 16.7 
to be liable for a civil penalty or assessment under Sec. 16.3.
    Department means the Department of the Treasury.
    Government means the United States Government.
    Individual means a natural person.
    Initial decision means the written decision of the ALJ required by 
Sec. 16.10 or Sec. 16.37, and includes a revised initial decision 
issued following a remand or a motion for reconsideration.
    Investigating official means the Inspector General of the Department 
of the Treasury.
    Knows or has reason to know, means that a person, with respect to a 
claim or statement--
    (a) Has actual knowledge that the claim or statement is false, 
fictitious, or fraudulent;
    (b) Acts in deliberate ignorance of the truth or falsity of the 
claim or statement; or
    (c) Acts in reckless disregard of the truth or falsity of the claim 
or statement.
    Makes, wherever it appears, shall include the terms ``presents,'' 
``submits,'' and ``causes to be made, presented,'' or ``submitted.'' As 
the context requires, making or made, shall likewise include the 
corresponding forms of such terms.
    Person means any individual, partnership, corporation, association, 
private organization, State, political subdivision of a State, 
municipality, county, district, and Indian tribe, and includes the 
plural of that term.
    Presiding officer means an administrative law judge appointed in the 
authority pursuant to 5 U.S.C. 3105 or detailed to the authority 
pursuant to section 3344 of such title.
    Representative means an attorney designated in writing by a 
defendant to appear on his or her behalf in administrative hearings 
before the Department and to represent a defendant in all other legal 
matters regarding a complaint made pursuant to these regulations.
    Reviewing official means the General Counsel, or another individual 
in the Legal Division of the Department designated by the General 
Counsel, who is--
    (a) Serving in a position for which the rate of basic pay is not 
less than the minimum rate of basic pay for grade GS-16; and
    (b) Is not subject to supervision by, or required to report to, the 
investigating official; and
    (c) Is not employed in the organization unit of the authority in 
which the investigating official is employed.
    Statement means any representation, certification, affirmation, 
document, record, or accounting or bookkeeping entry made--
    (a) With respect to a claim or to obtain the approval or payment of 
a claim (including relating to eligibility to make a claim); or
    (b) With respect to (including relating to eligibility for)--
    (1) A contract with, or a bid or proposal for a contract with; or
    (2) A grant, loan, or benefit from, the authority, or any State, 
political subdivision of a State, or other party, if the United States 
Government provides any portion of the money or property under such 
contract or for such grant, loan, or benefit, or if the government will 
reimburse such State, political subdivision, or party of any portion of

[[Page 204]]

the money or property under such contract or for such grant, loan, or 
benefit, except that such term does not include any claim made in any 
return of tax imposed by the Internal Revenue Code of 1954.



Sec. 16.3  Basis for civil penalties and assessments.

    (a) Claims. (1) Except as provided in paragraph (c) of this section, 
any person who makes a claim that the person knows or has reason to 
know--
    (i) Is false, fictitious, or fraudulent;
    (ii) Includes or is supported by any written statement which asserts 
a material fact which is false, fictitious, or fraudulent;
    (iii) Includes or is supported by any written statement that--
    (A) Omits a material fact;
    (B) Is false, fictitious, or fraudulent as a result of such 
omission; and
    (C) Is a statement in which the person making such statement has a 
duty to include such material fact; or
    (iv) Is for payment for the provision of property or services which 
the person has not provided as claimed, shall be subject, in addition to 
any other remedy that may be prescribed by law, to a civil penalty of 
not more than $5,000 for each such claim.
    (2) Each voucher, invoice, claim form, or other individual request 
or demand for property, services, or money constitutes a separate claim.
    (3) A claim shall be considered made to an authority, recipient, or 
party when such claim is actually made to an agent, fiscal intermediary, 
or other entity, including any State or political subdivision thereof, 
acting for or on behalf of such authority, recipient, or party.
    (4) Each claim for property, services, or money is subject to a 
civil penalty under these regulations regardless of whether such 
property, services, or money is actually delivered or paid.
    (5) If the government has made any payment (including transferred 
property or provided services) on a claim, a person subject to a civil 
penalty under paragraph (a)(1) of this section shall also be subject to 
an assessment of not more than twice the amount of such claim or that 
portion thereof that is determined to be in violation of paragraph 
(a)(1) of this section. Such assessment shall be in lieu of damages 
sustained by the Government because of such claim.
    (b) Statements. (1) Except as provided in paragraph (c) of this 
section, any person who makes a written statement that--
    (i) The person knows or has reason to know--
    (A) Asserts a material fact which is false, fictitious, or 
fraudulent; or
    (B) Is false, fictitious, or fraudulent because it omits a material 
fact that the person making the statement has a duty to include in such 
statement; and
    (ii) Includes or is accompanied by an express certification or 
affirmation of the truthfulness and accuracy of the content of the 
statement,

shall be subject, in addition to any other remedy that may be prescribed 
by law, to a civil penalty of not more than $5,000 for each such 
statement.
    (2) Each written representation, certification, or affirmation 
constitutes a separate statement.
    (3) A statement shall be considered made to an authority when such 
statement is actually made to an agent, fiscal intermediary, or other 
entity, including any State or political subdivision thereof, acting for 
or on behalf of such authority.
    (c)(1) In the case of any claim or statement made by any individual 
relating to any of the benefits listed in paragraph (c)(2) of this 
section, received by such individual, such individual may be held liable 
for penalties and assessments under this section only if such claim or 
statement is made by such individual in making application for such 
benefits with respect to such individual's eligibility to receive such 
benefits.
    (2) For purposes of this paragraph, the term benefits means--
    (i) Benefits under the food stamp program (as defined in section 
3(h) of the Food Stamp Act of 1977);
    (ii) Benefits under Chapters 11, 13, 15, 17, and 21 of Title 38;
    (iii) Benefits under the Black Lung Benefits Act;
    (iv) Any authority or other benefit under the Railroad Retirement 
Act of 1974;

[[Page 205]]

    (v) Benefits under the National School Lunch Act;
    (vi) Benefits under any housing assistance program for lower income 
families or elderly or handicapped persons which is administered by the 
Secretary of Housing and Urban Development or the Secretary of 
Agriculture;
    (vii) Benefits under the special supplemental food program for 
women, infants, and children established under section 17 of the Child 
Nutrition Act of 1966;
    (viii) Benefits under part A of the Energy Conservation in Existing 
Buildings Act of 1976;
    (ix) Benefits under the supplemental security income program under 
title XVI of the Social Security Act;
    (x) Old age, survivors, and disability insurance benefits under 
title II of the Social Security Act;
    (xi) Benefits under title XVIII of the Social Security Act;
    (xii) Aid to families with dependent children under a State plan 
approved under section 402(a) of the Social Security Act;
    (xiii) Medical assistance under a State plan approved under section 
1902(a) of the Social Security Act;
    (xiv) Benefits under title XX of the Social Security Act;
    (xv) Benefits under section 336 of the Older Americans Act; or
    (xvi) Benefits under the Low-Income Home Energy Assistance Act of 
1981, which are intended for the personal use of the individual who 
receives the benefits or for a member of the individual's family.
    (d) No proof of specific intent to defraud is required to establish 
liability under this section.
    (e) In any case in which it is determined that more than one person 
is liable for making a claim or statement under this section, each such 
person may be held liable for a civil penalty under this section.
    (f) In any case in which it is determined that more than one person 
is liable for making a claim under this section, and on which the 
Government has made payment (including transferred property or provided 
services), an assessment may be imposed against any such person or 
jointly and severally against any combination of such persons.



Sec. 16.4  Investigation.

    (a) If an investigating official concludes that a subpoena pursuant 
to the authority conferred by 31 U.S.C. 3804(a) is warranted--
    (1) The subpoena so issued shall notify the person to whom it is 
addressed of the authority under which the subpoena is issued and shall 
identify the information, records, or documents sought;
    (2) The investigating official may designate a person to act on his 
behalf to receive the information, records, or documents sought; and
    (3) The person receiving such subpoena shall be required to tender 
to the investigating official or to the person designated to receive the 
information, records, or documents, a certification that the 
information, records, or documents sought have been produced, or that 
such information, records, or documents are not available and the 
reasons therefor, or that such information, records, or documents, 
suitably identified, have been withheld based upon the assertion of an 
identified legal privilege.
    (b) If the investigating official concludes that an action under the 
Program Fraud Civil Remedies Act may be warranted, the investigating 
official shall report the findings and conclusions of such investigation 
to the reviewing official.
    (c) Nothing in this section shall preclude or limit the 
investigating official's discretion to refer allegations directly to the 
Department of Justice for suit under the False Claims Act, 31 U.S.C. 
3729-3731, or for other civil relief, or to preclude or limit such 
official's discretion to defer or postpone a report or referral to avoid 
interference with an investigation into criminal misconduct or a 
criminal prosecution.
    (d) Nothing in this section modifies any responsibility of the 
investigating official to report violations of criminal law to the 
Attorney General.



Sec. 16.5  Review by the reviewing official.

    (a) If, based on the report of the investigating official under 
Sec. 16.4(b), the reviewing official determines that

[[Page 206]]

there is adequate evidence to believe that a person is liable under 
Sec. 16.3 of this part, the reviewing official shall transmit to the 
Attorney General a written notice of the reviewing official's intention 
to issue a complaint under Sec. 16.7.
    (b) Such notice shall include--
    (1) A statement of the reviewing official's reasons for issuing a 
complaint;
    (2) A statement specifying the evidence that supports the 
allegations of liability;
    (3) A description of the claims or statements upon which the 
allegations of liability are based;
    (4) An estimate of the amount of money or the value, if any, of 
property, services, or other benefits requested or demanded in violation 
of Sec. 16.3 of this part; or, if no monetary value can be put on the 
property, service or benefit, a statement regarding the non-monetary 
consequences to the agency of a false statement.
    (5) A statement of any exculpatory or mitigating circumstances that 
may relate to the claims or statements known by the reviewing official 
or the investigating official; and
    (6) A statement that there is a reasonable prospect of collecting an 
appropriate amount of penalties and assessments. Such a statement may be 
based upon information then known or an absence of any information 
indicating that the person may be unable to pay such an amount.



Sec. 16.6  Prerequisites for issuing a complaint.

    (a) The reviewing official may issue a complaint under Sec. 16.7 
only if--
    (1) The Department of Justice approves the issuance of a complaint 
in a written statement described in 31 U.S.C. 3803(b)(l), and
    (2) In the case of allegations of liability under Sec. 16.3(a) with 
respect to a claim, the reviewing official determines that, with respect 
to such claim or a group of related claims submitted at the same time 
such claim is submitted (as defined in paragraph (b) of this section), 
the amount of money or the value of property or services demanded or 
requested in violation of Sec. 16.3(a) does not exceed $150,000.
    (b) For the purposes of this section, a related group of claims 
submitted at the same time shall include only those claims arising from 
the same transaction (e.g., grant, loan, application, or contract) that 
are submitted simultaneously as part of a single request, demand, or 
submission.
    (c) Nothing in this section shall be construed to limit the 
reviewing official's authority to join in a single complaint against a 
person, claims that are unrelated or were not submitted simultaneously, 
regardless of the amount of money or the value of property or services 
demanded or requested, as long as the total amount for each claim does 
not exceed $150,000.



Sec. 16.7  Complaint.

    (a) On or after the date the Attorney General or his designee 
approves the issuance of a complaint in accordance with 31 U.S.C. 
3803(b)(1), the reviewing official may serve a complaint on the 
defendant, as provided in Sec. 16.8.
    (b) The complaint shall state--
    (1) The allegations of liability against the defendant, including 
the statutory basis for liability, an identification of the claims or 
statements that are the basis for the alleged liability, and the reasons 
why liability allegedly arises from such claims or statements;
    (2) The maximum amount of penalties and assessments for which the 
defendant may be held liable;
    (3) Instructions for filing an answer to request a hearing, 
including a specific statement of the defendant's right to request a 
hearing by filing an answer and to be represented by an attorney;
    (4) That the defendant has a right to review and obtain certain 
information pursuant to Section 16.20 herein; and
    (5) That failure to file an answer within 30 days of service of the 
complaint will result in the imposition of the maximum amount of 
penalties and assessments without right to appeal.
    (c) At the same time the reviewing official serves the complaint on 
the defendant(s), he or she shall serve the defendant with a copy of 
these regulations.

[[Page 207]]



Sec. 16.8  Service of complaint.

    (a) Service of a complaint must be made by a certified or registered 
mail or by delivery in any manner authorized by Rule 4(d) of the Federal 
Rules of Civil Procedure.
    (b) Proof of service, stating the name and address of the person on 
whom the complaint was served, and the manner and date of service, may 
be made by--
    (1) Affidavit of the individual making service;
    (2) An acknowledged United States Postal Service return receipt 
card; or
    (3) Written acknowledgement of the defendant or his representative.



Sec. 16.9  Answer.

    (a) The defendant may request a hearing by filing an answer with the 
reviewing official within 30 days of service of the complaint. An answer 
shall be deemed to be a request for hearing.
    (b) In the answer, the defendant--
    (1) Shall admit or deny each of the allegations of liability made in 
the complaint;
    (2) Shall state any defense on which the defendant intends to rely;
    (3) May state any reasons why the defendant contends that the 
penalties and assessments should be less than the statutory maximum; and
    (4) Shall state whether the defendant has authorized an attorney to 
act as defendant's representative, and shall state the name, address, 
and telephone number of the representative.



Sec. 16.10  Default upon failure to file an answer.

    (a) If the defendant does not file an answer within the time 
prescribed in Sec. 16.9(a), the reviewing official may refer the 
complaint to the ALJ for initial decision.
    (b) Upon the referral of the complaint, the ALJ shall promptly serve 
on defendant in the manner prescribed in Sec. 16.8, a notice that an 
initial decision will be issued under this section.
    (c) If the defendant fails to file a timely answer, the ALJ shall 
assume the facts alleged in the complaint to be true and, if such facts 
eatablish liability under Sec. 16.3, the ALJ shall issue an initial 
decision imposing the maximum amount of penalties and assessments 
allowed under the statute.
    (d) Except as otherwise provided in this section, by failing to file 
a timely answer, the defendant waives any right to further review of the 
penalties and assessments imposed under paragraph (c) of this section, 
and the initial decision shall become final and binding upon the parties 
30 days after it is issued.
    (e) If, before such an initial decision becomes final, the defendant 
files a motion with the ALJ, and serves a copy on the agency, seeking to 
reopen on the grounds that extraordinary circumstances prevented the 
defendant from filing a timely answer, the initial decision shall be 
stayed pending the ALJ's decision on the motion. The ALJ shall permit 
the agency a reasonable amount of time, not less than 15 calendar days, 
to respond to the defendant's motion.
    (f) If, on such motion, the defendant can demonstrate extraordinary 
circumstances excusing the failure to file a timely answer, the ALJ 
shall withdraw the initial decision, if such a decision has been issued 
pursuant to paragraph (c) of this section, and shall grant the defendant 
an opportunity to answer the complaint.
    (g) A decision of the ALJ denying a defendant's motion under 
paragraph (e) of this section is not subject to reconsideration under 
Sec. 16.38.
    (h) The defendant may appeal to the authority head the decision 
denying a motion to reopen by filing a notice of appeal with the 
authority head within 15 days after the ALJ denies the motion. The 
timely filing of a notice of appeal shall stay the initial decision 
until the authority head decides the issue.
    (i) If the defendant files a timely notice of appeal with the 
authority head, the ALJ shall forward the record of the proceeding to 
the authority head.
    (j) The authority head shall decide expeditiously, and based solely 
on the record before the ALJ, whether extraordinary circumstances excuse 
the defendant's failure to file a timely answer.
    (k) If the authority head decides that extraordinary circumstances 
excuse the defendant's failure to file a timely

[[Page 208]]

answer, the authority head shall remand the case to the ALJ with 
instructions to grant the defendant an opportunity to file an answer.
    (l) If the authority head decides that the defendant's failure to 
file a timely answer is not excused, the authority head shall reinstate 
the initial decision of the ALJ, which shall become final and binding 
upon the parties 30 days after the authority head issues such decision.



Sec. 16.11  Referral of complaint and answer to the ALJ.

    Upon receipt of an answer, the reviewing official shall file the 
complaint and answer with the ALJ.



Sec. 16.12  Notice of hearing.

    (a) When the ALJ receives the complaint and answer, the ALJ shall 
promptly serve a notice of hearing upon the defendant and the agency 
representative in the manner prescribed by Sec. 16.8.
    (b) Such notice shall include--
    (1) The tentative time and place, and the nature of the hearing;
    (2) The legal authority and jurisdiction under which the hearing is 
to be held;
    (3) The matters of fact and law to be asserted;
    (4) A description of the procedures for the conduct of the hearing;
    (5) The names, addresses, and telephone numbers of the 
representatives of the Government and of the defendant, if any; and
    (6) Such other matters as the ALJ deems appropriate.



Sec. 16.13  Parties to the hearing.

    (a) The parties to the hearing shall be the defendant and the 
authority.
    (b) Pursuant to 31 U.S.C. 3730(c)(5), a private plaintiff under the 
False Claims Act may participate in these proceedings to the extent 
authorized by the provisions of that Act.



Sec. 16.14  Separation of functions.

    (a) The investigating official, the reviewing official, and any 
employee or agent of the authority who takes part in investigating, 
preparing, or presenting a particular case may not, in such case or a 
factually related case--
    (1) Participate in the hearing as the ALJ;
    (2) Participate or advise in the initial decision or the review of 
the initial decision by the authority head, except as a witness or a 
representative in public proceedings; or
    (3) Make the collection of penalties and assessments under 31 U.S.C. 
3806.
    (b) The ALJ shall not be responsible to, or subject to the 
supervision or direction of the investigating official or the reviewing 
official.
    (c) Except as provided in paragraph (a) of this section, the 
representative for the Government may be an attorney employed anywhere 
in the Legal Division of the Department, or an attorney employed in the 
offices of either the investigating official or the reviewing official; 
however the representative of the Government may not participate or 
advise in the review of the initial decision by the authority head.



Sec. 16.15  Ex parte contacts.

    No party or person (except employees of the ALJ's office) shall 
communicate in any way with the ALJ on any matter at issue in a case, 
unless on notice and opportunity for all parties to participate. This 
provision does not prohibit a person or party from inquiring about the 
status of a case or asking routine questions concerning administrative 
functions or procedures.



Sec. 16.16  Disqualification of reviewing official or ALJ.

    (a) A reviewing official or ALJ in a particular case may disqualify 
himself or herself at any time.
    (b) A party may file with the ALJ a motion for disqualification of a 
reviewing official or an ALJ. Such motion shall be accompanied by an 
affidavit alleging personal bias or other reason for disqualification.
    (c) Such motion and affidavit shall be filed promptly upon the 
party's discovery of reasons requiring disqualification, or such 
objections shall be deemed waived.
    (d) Such affidavit shall state specific facts that support the 
party's assertion that personal bias or other reason for 
disqualification exists and the time

[[Page 209]]

and circumstances of the party's discovery of such facts. It shall be 
accompanied by a certificate of the representative of record that it is 
made in good faith.
    (e) Upon the filing of such a motion and affidavit, the ALJ shall 
proceed no further in the case until he or she resolves the matter of 
disqualification in accordance with paragrpah (f) of this section.
    (f)(1) If the ALJ determines that a reviewing official is 
disqualified, the ALJ shall dismiss the complaint without prejudice.
    (2) If the ALJ disqualifies himself or herself, the agency shall 
seek to have the case promptly reassigned to another ALJ.
    (3) If the ALJ denies a motion to disqualify, the authority head may 
determine the matter only as part of his or her review of the initial 
decision upon appeal, if any.



Sec. 16.17  Rights of parties.

    Except as otherwise limited by this part, all parties may--
    (a) Be accompanied, represented, and advised by an attorney;
    (b) Participate in any conference held by the ALJ;
    (c) Conduct discovery;
    (d) Agree to stipulations of fact or law, which shall be made part 
of the record;
    (e) Present evidence relevant to the issues at the hearing;
    (f) Present and cross-examine witnesses;
    (g) Present oral arguments at the hearing as permitted by the ALJ; 
and
    (h) Submit written beliefs and proposed findings of fact and 
conclusions of law after the hearing.



Sec. 16.18  Authority of the ALJ.

    (a) The ALJ shall conduct a fair and impartial hearing, avoid delay, 
maintain order, and assure that a record of the proceeding is made.
    (b) The ALJ has the authority to--
    (1) Set and change the date, time, and place of the hearing upon 
reasonable notice to the parties;
    (2) Continue or recess the hearing in whole or in part for a 
reasonable period of time;
    (3) Hold conferences to identify or simplify the issues, or to 
consider other matters that may aid in the expeditious disposition of 
the proceeding;
    (4) Administer oaths and affirmations;
    (5) Issue subpoenas requiring the attendance of witnesses and the 
production of documents at depositions or at hearings;
    (6) Rule on motions and other procedural matters;
    (7) Regulate the scope and timing of discovery;
    (8) Regulate the course of the hearing and the conduct of 
representatives and parties;
    (9) Examine witnesses;
    (10) Receive, rule on, exclude, or limit evidence;
    (11) Upon motion of a party, take official notice of facts;
    (12) Upon motion of a party, decide cases, in whole or in part, by 
summary judgment where there is no disputed issue of material fact;
    (13) Conduct any conference, argument, or hearing on motions in 
person or by telephone; and
    (14) Exercise such other authority as is necessary to carry out the 
responsibilities of the ALJ under this part.
    (c) The ALJ does not have the authority to make any determinations 
regarding the validity of Federal statutes or regulations, or 
Departmental orders, Directives, or other published rules.



Sec. 16.19  Prehearing conferences.

    (a) The ALJ may schedule prehearing conferences as appropriate.
    (b) Upon the motion of any party, the ALJ shall schedule at least 
one prehearing conference at a reasonable time in advance of the 
hearing.
    (c) The ALJ may use prehearing conferences to discuss the following:
    (1) Simplification of the issues;
    (2) The necessity or desirability of amendments to the pleadings, 
including the need for a more definite statement;
    (3) Stipulations, admissions of fact or the content and authenticity 
of documents;
    (4) Whether the parties can agree to submission of the case on a 
stipulated record;

[[Page 210]]

    (5) Whether a party chooses to waive appearance at an oral hearing 
and to submit only documentary evidence (subject to the objection of 
other parties) and written argument;
    (6) Limitation of the number of witnesses;
    (7) Scheduling dates for the exchange of witness lists and of 
proposed exhibits;
    (8) Discovery;
    (9) The time and place for the hearing; and
    (10) Such other matters as may tend to expedite the fair and just 
disposition of the proceedings.
    (d) The ALJ may issue an order containing all matters agreed upon by 
the parties or ordered by the ALJ at a prehearing conference.



Sec. 16.20  Disclosure of documents.

    (a) Upon written request to the reviewing official, the defendant 
may review any relevant and material documents, transcripts, records, 
and other material that relate to the allegations set out in the 
complaint and upon which the findings and conclusions of the 
investigating official under Sec. 16.4(b) are based unless such 
documents are subject to a privilege under Federal law. The Department 
shall schedule such review at a time and place convenient to it. Upon 
payment of fees for duplication, the defendant may obtain copies of such 
documents.
    (b) Upon written request to the reviewing official, the defendant 
also may obtian a copy of all exculpatory information in the possession 
of the reviewing official or investigating official relating to the 
allegations in the complaint, even if it is contained in a document that 
would otherwise be privileged. If the document would otherwise be 
privileged, only that portion containing exculpatory information must be 
disclosed.
    (c) The notice sent to the Attorney General from the reviewing 
official as described in Sec. 16.5 is not discoverable under any 
circumstances.
    (d) The defendant may file a motion to compel disclosure of the 
documents subject to the provisions of this section. Such a motion may 
only be filed with the ALJ following the filing of an answer pursuant to 
Sec. 16.9.



Sec. 16.21  Discovery.

    (a) The following types of discovery are authorized:
    (1) Requests for production of documents for inspection and copying;
    (2) Requests for admissions of the authenticity of any relevant 
document or of the truth of any relevant fact;
    (3) Written interrogatories; and
    (4) Depositions.
    (b) For the purposes of this section and Sec. Sec. 16.22 and 16.23, 
the term ``documents'' includes information, documents, reports, 
answers, records, accounts, papers, and other data, either paper or 
electronic, and other documentary evidence. Nothing contained herein 
shall be interpreted to require the creation of a document.
    (c) Unless mutually agreed to by the parties, discovery is available 
only as ordered by the ALJ. The ALJ shall regulate the timing of 
discovery.
    (d) Motions for discovery. (1) A party seeking discovery may file a 
motion with the ALJ if it is not made available by another party on an 
informal basis. Such a motion shall be accompanied by a copy of the 
requested discovery, or in the case of depositions, a summary of the 
scope of the proposed deposition, and a description of the efforts which 
have been made by the party to obtain discovery.
    (2) Within ten days of service, a party may file an opposition to 
the motion and/or a motion for protective order as provided in Sec. 
16.24.
    (3) The ALJ may grant a motion for discovery only if he or she finds 
that the discovery sought--
    (i) Is necessary for the expeditious, fair, and reasonable 
consideration of the issues;
    (ii) Is not unduly costly or burdensome;
    (iii) Will not unduly delay the proceeding; and
    (iv) Does not seek privileged information.
    (4) The burden of showing that discovery should be allowed is on the 
party seeking discovery.
    (5) The ALJ may grant discovery subject to a protective order under 
Sec. 16.24.
    (e) Depositions. (1) If a motion for deposition is granted, the ALJ 
shall issue a subpoena for the deponent, which may require the deponent 
to produce

[[Page 211]]

documents. The subpoena shall specify the time and place at which the 
deposition will be held.
    (2) The party seeking to depose shall serve the subpoena in the 
manner prescribed in Sec. 16.8.
    (3) The deponent may file with the ALJ a motion to quash the 
subpoena or a motion for a protective order within ten days of service.
    (4) The party seeking to depose shall provide for the taking of a 
verbatim transcript of the deposition, which it shall make available to 
all other parties for inspection and copying.
    (f) Each party shall bear its own costs of discovery.



Sec. 16.22  Exchange of witness lists, statements, and exhibits.

    (a) At least 15 days before the hearing or at such other time as may 
be ordered by the ALJ, the parties shall exchange witness lists, copies 
of prior statements of proposed witnesses, and copies of proposed 
hearing exhibits, including copies of any written statements that the 
party intends to offer in lieu of live testimony in accordance with 
Sec. 16.33(b). At the time the above documents are exchanged, any party 
that intends to rely on the transcript of deposition testimony in lieu 
of live testimony at the hearing, if permitted by the ALJ, shall provide 
each party with a copy of the specific pages of the transcript it 
intends to introduce into evidence.
    (b) If a party objects, the ALJ shall not admit into evidence the 
testimony of any witness whose name does not appear on the witness list 
or any exhibit not provided to the opposing party as provided above 
unless the ALJ finds good cause and that there is no prejudice to the 
objecting party.
    (c) Unless another party objects within the time set by the ALJ, 
documents exchanged in accordance with paragraph (a) of this section, 
shall be deemed to be authentic for the purpose of admissibility at the 
hearing.



Sec. 16.23  Subpoenas for attendance at hearing.

    (a) A party wishing to procure the appearance and testimony of any 
individual at the hearing may request that the ALJ issue a subpoena.
    (b) A subpoena requiring the attendance and testimony of an 
individual may also require the individual to produce documents at the 
hearing.
    (c) A party seeking a subpoena shall file a written request therefor 
not less than 15 days before the date fixed for the hearing unless 
otherwise allowed by the ALJ for good cause shown. Such request shall 
specify any documents to be produced and shall designate the witnesses 
and describe the address and location thereof with sufficient 
particularity to permit such witnesses to be found.
    (d) The subpoena shall specify the time and place at which the 
witness is to appear and any documents the witness is to bring with him 
or her.
    (e) The party seeking the subpoena shall serve it in the manner 
prescribed in Sec. 16.8. A subpoena on a party or upon an individual 
under the control of a party may be served by first class mail.
    (f) A party or the individual to whom the subpoena is directed may 
file with the ALJ a motion to quash the subpoena within ten days after 
service or on or before the time specified in the subpoena for 
compliance if it is less than ten days after service.



Sec. 16.24  Protective order.

    (a) A party or a prospective witness or deponent may file a motion 
for a protective order with respect to discovery sought by an opposing 
party or with respect to the hearing, seeking to limit the availability 
or disclosure of evidence.
    (b) In issuing a protective order, the ALJ may make any order which 
justice requires to protect a party or person from annoyance, 
embarrassment, oppression, or undue burden or expense, including one or 
more of the following:
    (1) That the discovery not be had;
    (2) That the discovery may be had only on specified terms and 
conditions, including a designation of the time or place;
    (3) That the discovery may be had only through a method of discovery 
other than that requested;
    (4) That certain matters not be inquired into, or that the scope of 
discovery be limited to certain matters;

[[Page 212]]

    (5) That discovery be conducted with no one present except persons 
designated by the ALJ;
    (6) That the contents of discovery or evidence be sealed;
    (7) That a deposition after being sealed be opened only by order of 
the ALJ;
    (8) That a trade secret or other confidential research, development, 
commercial information, or facts pertaining to any criminal 
investigation, proceeding, or other administrative investigation not be 
disclosed or be disclosed only in a designated way; or
    (9) That the parties simultaneously file specified documents or 
information enclosed in sealed envelopes to be opened as directed by the 
ALJ.



Sec. 16.25  Fees.

    The party requesting a subpoena shall pay the cost of the fees and 
mileage of any witness subpoenaed in the amounts that would be payable 
to a witness in a proceeding in United States District Court. A check 
for witness fees and mileage shall accompany the subpoena when served, 
except that when a subpoena is issued on behalf of the authority, a 
check for witness fees and mileage need not accompany the subpoena.



Sec. 16.26  Form, filing and service of papers.

    (a) Form. (1) Documents filed with the ALJ shall include a original 
and two copies.
    (2) Every pleading and paper filed in the proceeding shall contain a 
caption setting forth the title of the action, the case number assigned 
by the ALJ, and a designation of the paper (e.g., motion to quash 
subpoena).
    (3) Every pleading and paper shall be signed by, and shall contain 
the address and telephone number of the party or the person on whose 
behalf the paper was filed, or his or her representative.
    (4) Papers are considered filed when they are mailed. Date of 
mailing may be etablished by a certificate from the party or its 
representative or by proof that the document was sent by certified or 
registered mail.
    (b) Service. A party filing a document with the ALJ shall, at the 
time of filing, serve a copy of such document on every other party. 
Service upon any party of any document other than the complaint or 
notice of hearing shall be made by delivering or mailing a copy to the 
party's last known address. When a party is represented by an attorney, 
service shall be made upon such representative in lieu of the actual 
party.
    (c) Proof of service. A certificate of the individual serving the 
document by personal delivery or by mail, setting forth the manner of 
service, shall be proof of service.



Sec. 16.27  Computation of time.

    (a) In computing any period of time under this part or in an order 
issued thereunder, the time begins with the day following the act, 
event, or default, and includes the last day of the period, unless it is 
a Saturday, Sunday, or legal holiday observed by the Federal Government, 
in which event it includes the next business day.
    (b) When the period of time allowed is less than seven days, 
intermediate Saturdays, Sundays, and legal holidays observed by the 
Federal Government shall be excluded from the computation. When the 
period of time allowed is more than seven days, all intervening calendar 
days are included in the computation.
    (c) Where a document has been served or issued by mail, an 
additional five days will be added to the time permitted for any 
response.



Sec. 16.28  Motions.

    (a) Any application to the ALJ for an order or ruling shall be by 
motion. Motions shall state the relief sought, the authority relied 
upon, and the facts alleged, and shall be filed with the ALJ and served 
on all other parties.
    (b) Except for motions made during a prehearing conference or at the 
hearing, all motions shall be in writing. The ALJ may require that oral 
motions be reduced to writing.
    (c) Within 15 days after a written motion is served, or such other 
time as may be fixed by the ALJ, any party may file a response to such 
motion.
    (d) The ALJ may not grant a written motion before the time for 
filing responses thereto has expired, except

[[Page 213]]

upon consent of the parties or following a hearing on the motion, but 
may overrule or deny such motion without awaiting a response.
    (e) The ALJ shall make a reasonable effort to dispose of all 
outstanding motions prior to the beginning of the hearing.



Sec. 16.29  Sanctions.

    (a) The ALJ may sanction a person, including any party or 
representative for--
    (1) Failing to comply with an order, rule, or procedure governing 
the proceeding;
    (2) Failing to prosecute or defend an action; or
    (3) Engaging in other misconduct that interferes with the speedy, 
orderly, or fair conduct of the hearing.
    (b) Any such sanction, including but not limited to those listed in 
paragraphs (c), (d), and (e) of this section, shall reasonably relate to 
the nature of the failure or misconduct.
    (c) When a party fails to comply with an order, including an order 
for taking a deposition, the production of evidence within the party's 
control, or a request for admission, the ALJ may--
    (1) Draw an inference in favor of the requesting party with regard 
to the information sought;
    (2) In the case of requests for admission, deem each matter of which 
an admission is requested to be admitted;
    (3) Prohibit the party failing to comply with such order from 
introducing evidence concerning, or otherwise relying upon testimony 
relating to the information sought; and
    (4) Strike any part of the pleadings or other submissions of the 
party failing to comply with such request.
    (d) If a party fails to prosecute or defend an action under this 
part commenced by service of a notice of hearing, the ALJ may dismiss 
the action or may issue an initial decision imposing penalties and 
assessments.
    (e) The ALJ may refuse to consider any motion, request, response, 
brief or other document which is not filed in a timely fashion.



Sec. 16.30  The hearing and burden of proof.

    (a) The ALJ shall conduct a hearing on the record in order to 
determine whether the defendant is liable for a civil penalty or 
assessment under Sec. 16.3 and, if so, the appropriate amount of any 
such civil penalty or assessment considering any aggravating or 
mitigating factors.
    (b) The authority shall have the burden of proving defendant's 
liability and any aggravating factors by a preponderance of the 
evidence.
    (c) The defendant shall have the burden of proving any affirmative 
defenses and any mitigating factors by a preponderance of the evidence.
    (d) The hearing shall be open to the public unless otherwise ordered 
by the ALJ for good cause shown.



Sec. 16.31  Determining the amount of penalties and assessments.

    (a) In determining an appropriate amount of civil penalties and 
assessements, the ALJ and upon appeal, the authority head, should 
evaluate any circumstances that mitigate or aggravate the violation and 
should articulate in their opinions the reasons that support the 
penalties and assessments they impose. Because of the intangible costs 
of fraud, the expense of investigating such conduct, and the need to 
deter others who might be similarly tempted, double damages and a 
significant civil penalty ordinarily should be imposed.
    (b) Although not exhaustive, the following factors are among those 
that may influence the ALJ and the authority head in determining the 
amount of penalties and assessments to impose with respect to the 
misconduct (i.e., the false, fictitious, or fraudulent claims or 
statements) charged in the complaint:
    (1) The number of false, fictitious, or fraudulent claims or 
statements;
    (2) The time period over which such claims or statements were made;
    (3) The degree of the defendant's culpability with respect to the 
misconduct;
    (4) The amount of money or the value of the property, services, or 
benefit falsely claimed;

[[Page 214]]

    (5) The value of the Government's actual loss as a result of the 
misconduct, including foreseeable consequential damages and the costs of 
investigation;
    (6) The relationship of the amount imposed as civil penalties to the 
amount of the Government's loss;
    (7) The potential or actual impact of the misconduct upon national 
defense, public health or safety, or public confidence in the management 
of Government programs and operations;
    (8) Whether the defendant has engaged in a pattern of the same or 
similar misconduct;
    (9) Whether the defendant attempted to conceal the misconduct;
    (10) The degree to which the defendant has involved others in the 
misconduct or in concealing it;
    (11) Where the misconduct of employees or agents is imputed to the 
defendant, the extent to which the defendant's practices fostered or 
attempted to preclude such misconduct;
    (12) Whether the defendant cooperated in or obstructed an 
investigation of the misconduct;
    (13) Whether the defendant assisted in identifying and prosecuting 
other wrongdoers;
    (14) The complexity of the program or transaction, and the degree of 
the defendant's sophistication with respect to it, including the extent 
of the defendant's prior participation in the program or in similar 
transactions;
    (15) Whether the defendant has been found, in any criminal, civil, 
or administrative proceeding to have engaged in similar misconduct or to 
have dealt dishonestly with the Government of the United States or of a 
State, directly or indirectly; and
    (16) The need to deter the defendant and others from engaging in the 
same or similar misconduct.
    (c) Nothing in this section shall be construed to limit the ALJ or 
the authority head from considering any other factors that in any given 
case may mitigate or aggravate the offense for which penalties and 
assessments are imposed.



Sec. 16.32  Location of hearing.

    (a) The hearing may be held--
    (1) In any judicial district of the United States in which the 
defendant resides or transacts business;
    (2) In any judicial district of the United States in which the claim 
or statement in issue was made; or
    (3) In such other place as may be agreed upon by the defendant and 
the ALJ.
    (b) Each party shall have the opportunity to present argument with 
respect to the location of the hearing.
    (c) The hearing shall be held at the place and at the time ordered 
by the ALJ.



Sec. 16.33  Witnesses.

    (a) Except as provided in paragraph (b) of this section, testimony 
at the hearing shall be given orally by witnesses under oath or 
affirmation.
    (b) At the discretion of the ALJ, testimony may be admitted in the 
form of a written statement or deposition. Any such written statement 
must be provided to all other parties along with the last known address 
of such witness, in a manner which allows sufficient time for other 
parties to subpoena such witness for cross-examination at the hearing. 
Prior written statements of witnesses proposed to testify at the hearing 
and deposition transcripts shall be exchanged as provided in Sec. 
16.22(a).
    (c) The ALJ shall exercise reasonable control over the mode and 
order of interrogating witnesses and presenting evidence so as to--
    (1) Make the interrogation and presentation effective for the 
ascertainment of the truth,
    (2) Avoid needless consumption of time, and
    (3) Protect witnesses from harassment or undue embarrassment.
    (d) The ALJ shall permit the parties to conduct such cross 
examination as may be required for a full and true disclosure of the 
facts.
    (e) At the discretion of the ALJ, a witness may be cross-examined on 
matters relevant to the proceeding without regard to the scope of his or 
her direct examination. To the extent permited

[[Page 215]]

by the ALJ, cross-examination on matters outside the scope of direct 
examination shall be conducted in the manner of direct examination and 
may proceed by leading questions only if the witness is a hostile 
witness, an adverse party, or a witness identified with an adverse 
party.
    (f) Upon motion of any party, the ALJ shall order witnesses excluded 
so that they cannot hear the testimony of other witnesses. This rule 
does not authorize exclusion of--
    (1) A party who is an individual;
    (2) In the case of a party that is not an individual, an officer or 
employee of the party designated by the party's representative; or
    (3) An individual whose presence is shown by a party to be essential 
to the presentation of its case, including an individual employed by the 
Government engaged in assisting the representative for the Government.



Sec. 16.34  Evidence.

    (a) The ALJ shall determine the admissibility of evidence.
    (b) Except as provided herein, the ALJ shall not be bound by the 
Federal Rules of Evidence. However, the ALJ may apply the Federal Rules 
of Evidence where appropriate, e.g., to exclude unreliable evidence.
    (c) The ALJ shall exclude irrelevant, immaterial, or incompetent 
evidence.
    (d) Although relevant, evidence may be excluded if its probative 
value is substantially outweighed by the danger of unfair prejudice, 
confusion of the issues, or by considerations of undue delay or needless 
presentation of cumulative evidence.
    (e) Although relevant, evidence may be excluded if it is privileged 
under Federal law.
    (f) Evidence concerning offers of compromise or settlement shall be 
inadmissible to the extent provided in Rule 408 of the Federal Rules of 
Evidence.
    (g) The ALJ shall permit the parties to introduce rebuttal witnesses 
and evidence.
    (h) All documents and other evidence offered or taken for the record 
shall be open to examination by all parties, unless otherwise ordered by 
the ALJ pursuant to Sec. 16.24.



Sec. 16.35  The record.

    (a) The hearing will be recorded and transcribed. Transcripts may be 
obtained following the hearing from the ALJ at a cost not to exceed the 
actual cost of duplication.
    (b) The transcript of testimony, exhibits and other evidence 
admitted at the hearing, and all papers and requests filed in the 
proceeding constitute the record for the decision by the ALJ and the 
authority head.
    (c) The record may be inspected and copied (upon payment of a 
reasonable fee) by anyone, unless otherwise ordered by the ALJ pursuant 
to Sec. 16.24.



Sec. 16.36  Post-hearing briefs.

    The ALJ may require the parties to file post-hearing briefs. The ALJ 
shall fix the time for filing such briefs, not to exceed 60 days from 
the date the parties receive the transcript of the hearing or, if 
applicable, the stipulated record. Such briefs may be accompanied by 
proposed findings of fact and conclusions of law. The ALJ may permit the 
parties to file reply briefs.



Sec. 16.37  Initial decision.

    (a) The ALJ shall issue an initial decision, based solely on the 
record, which shall contain findings of fact, conclusion of law, and the 
amount of any penalties and assessments imposed.
    (b) The findings of fact shall include a finding on each of the 
following issues:
    (1) Whether the claims or statements identified in the complaint, or 
any portions thereof, violate Sec. 16.3;
    (2) If the person is liable for penalties of assessments, the 
appropriate amount of any such penalties or assessments considering any 
mitigating or aggravating factors that he or she finds in the case, such 
as those described in Sec. 16.31.
    (c) The ALJ shall promptly serve the initial decision on all parties 
within 90 days after the time for submission of post-hearing briefs and 
reply briefs (if permitted) has expired. The ALJ shall at the same time 
serve all defendants with a statement describing the right of any 
defendant determined to be liable for a civil penalty or assessment to 
file a motion for reconsideration with

[[Page 216]]

the ALJ or a notice of appeal with the authority head. If the ALJ fails 
to meet the deadline contained in this paragraph, he or she shall notify 
the parties of the reason for the delay and shall set a new deadline.
    (d) Unless the initial decision of the ALJ is timely appealed to the 
authority head, or a motion for reconsideration of the initial decision 
is timely filed, the initial decision shall constitute the final 
decision of the authority head and shall be final and binding on the 
parties 30 days after it is issued by the ALJ.



Sec. 16.38  Reconsideration of initial decision.

    (a) Except as provided in paragraph (d) of this section, any party 
may file a motion for reconsideration of the initial decision within 20 
days of receipt of the initial decision. If service was made by mail, 
receipt will be presumed to be five days from the date of mailing in the 
absence of contrary proof.
    (b) Every such motion must set forth the matters claimed to have 
been erroneously decided and the nature of the alleged errors. Such 
motion shall be accompanied by a supporting brief.
    (c) Responses to such motions shall be allowed only upon request of 
the ALJ.
    (d) No party may file a motion for reconsideration of an initial 
decision that has been revised in response to a previous motion for 
reconsideration.
    (e) The ALJ may dispose of a motion for reconsideration by denying 
it or by issuing a revised initial decision.
    (f) When a motion for reconsideration is made, the time periods for 
appeal to the authority head contained in Sec. 16.38, and for finality 
of the initial decision in Sec. 16.36(d), shall begin on the date the 
ALJ issues the denial of the motion for reconsideration or a revised 
initial decision, as appropriate.



Sec. 16.39  Appeal to authority head.

    (a) Any defendant who has filed a timely answer and who is 
determined in an initial decision to be liable for a civil penalty or 
assessment may appeal such decision to the authority head by filing a 
notice of appeal with the authority head in accordance with this 
section.
    (b)(1) No notice of appeal may be filed until the time period for 
filing a motion for reconsideration under Sec. 16.38 has expired.
    (2) If a motion for reconsideration is timely filed, a notice of 
appeal must be filed within 30 days after the ALJ denies the motion or 
issues a revised initial decision, whichever applies.
    (3) If no motion for reconsideration is timely filed, a notice of 
appeal must be filed within 30 days after the ALJ issues the initial 
decision.
    (4) The authority head may extend the initial 30 days period for an 
additional 30 days if the defendant files with the authority head a 
request for extension within the initial 30 days period and shows good 
cause.
    (c) If the defendant files a timely notice of appeal with the 
authority head, the ALJ shall forward the notice of appeal and record of 
the proceeding to the authority head.
    (d) A notice of appeal shall be accompanied by a written brief 
specifying exceptions to the initial decision and reasons supporting the 
exceptions.
    (e) The representative for the agency may file a brief in opposition 
to exceptions within 30 days of receiving the notice of appeal and 
accompanying brief.
    (f) There is no right to appear personally before the authority 
head.
    (g) There is right to appeal any interlocutory ruling by the ALJ.
    (h) In reviewing the initial decision, the authority head shall not 
consider any objection that was not raised before the ALJ unless a 
demonstration is made of extraordinary circumstances causing the failure 
to raise the objection.
    (i) If any party demonstrates to the satisfaction of the authority 
head, prior to the issuance of the authority head's decision that 
additional evidence not presented at such hearing is material and that 
there were reasonable grounds for the failure to present such evidence 
at the hearing, the authority head shall remand the matter to the ALJ 
for consideration of such additional evidence.
    (j) The authority head may affirm, reduce, reverse, compromise, 
remand, or settle any penalty or assessment,

[[Page 217]]

determined by the ALJ in any initial decision.
    (k) The authority head shall promptly serve each party to the appeal 
to the ALJ with a copy of the decision of the authority head. At the 
same time the authority head shall serve the defendant with a statement 
describing the defendant's right to seek judicial review.
    (l) Unless a petition for judicial review is filed as provided in 31 
U.S.C. 3805 after a defendant has exhausted all administrative remedies 
under this part and within 60 days after the date on which the authority 
head serves the defendant with a copy of the authority head's decision, 
a determination that a defendant is liable under Sec. 16.3 is final and 
is not subject to judicial review.



Sec. 16.40  Stays ordered by the Department of Justice.

    If at any time the Attorney General or an Assistant Attorney General 
designated by the Attorney General transmits to the authority head a 
written finding that continuation of the administrative process 
described in this part with respect to a claim or statement may 
adversely affect any pending or potential criminal or civil action 
related to such claim or statement, the authority head shall stay the 
process immediately. In such a case, the authority head may order the 
process resumed only upon receipt of the written authorization of the 
Attorney General.



Sec. 16.41  Stay pending appeal.

    (a) An initial decision is stayed automatically pending disposition 
of a motion for reconsideration or of an appeal to the authority head.
    (b) No administrative stay is available following a final decision 
of the authority head.



Sec. 16.42  Judicial review.

    Section 3805 of title 31, United States Code, authorizes judicial 
review by an appropriate United States District Court of a final 
decision of the authority head imposing penalties or assessments under 
this part and specifies the procedures for such review.



Sec. 16.43  Collection of civil penalties and assessments.

    Sections 3806 and 3808(b) of title 31, United States Code, authorize 
actions for collection of civil penalties and assessments imposed under 
this part and specify the procedures for such actions.



Sec. 16.44  Right to administrative offset.

    The amount of any penalty or assessment which has become final, or 
for which a judgment has been entered under Sec. 16.42 or Sec. 16.43, 
or any amount agreed upon in a compromise or settlement under Sec. 
16.46, may be collected by administrative offset under 31 U.S.C. 3716, 
except that an administrative offset may not be made under this 
subsection against a refund of an overpayment of Federal taxes, then or 
later owing by the United States to the defendant.



Sec. 16.45  Deposit in Treasury of United States.

    All amounts collected pursuant to this part shall be deposited as 
miscellaneous receipts in the Treasury of the United States, except as 
provided in 31 U.S.C. 3806(g).



Sec. 16.46  Compromise or settlement.

    (a) Parties may make offers of compromise or settlement at any time.
    (b) The reviewing official has the exclusive authority to compromise 
or settle a case under this part at any time after the date on which the 
reviewing official is permitted to issue a complaint and before the date 
on which the ALJ issues an initial decision.
    (c) The authority head has exclusive authority to compromise or 
settle a case under this part at any time after the date on which the 
ALJ issues an initial decision, except during the pendency of any review 
under Sec. 16.42 or during the pendency of any action to collect 
penalties and assessments under Sec. 16.43.
    (d) The Attorney General has exclusive authority to compromise or 
settle a case under this part during the pendency of any review under 
Sec. 16.42 or of any action to recover penalties and assessments under 
31 U.S.C. 3806.
    (e) The investigating official may recommend settlement terms to the 
reviewing official, the authority head, or

[[Page 218]]

the Attorney General, as appropriate. The reviewing official may 
recommend settlement terms to the authority head, or the Attorney 
General, as appropriate.
    (f) Any compromise or settlement must be in writing and signed by 
all parties and their representatives.



Sec. 16.47  Limitations.

    (a) The notice of hearing with respect to a claim or statement must 
be served in the manner specified in Sec. 16.8 within 6 years after the 
date on which such claim or statement is made.
    (b) If the defendant fails to file a timely answer, service of a 
notice under Sec. 16.10(b) shall be deemed a notice of hearing for 
purposes of this section.
    (c) The time limits of this statute of limitations may be extended 
by agreement of the parties.



PART 17_ENFORCEMENT OF NONDISCRIMINATION ON THE BASIS OF HANDICAP IN 

PROGRAMS OR ACTIVITIES CONDUCTED BY THE DEPARTMENT OF THE TREASURY
--Table of Contents




Sec.
17.101 Purpose.
17.102 Application.
17.103 Definitions.
17.104-17.109 [Reserved]
17.110 Self-evaluation.
17.111 Notice.
17.112-17.129 [Reserved]
17.130 General prohibitions against discrimination.
17.131-17.139 [Reserved]
17.140 Employment.
17.141-17.148 [Reserved]
17.149 Program accessibility: Discrimination prohibited.
17.150 Program accessibility: Existing facilities.
17.151 Program accessibility: New construction and alterations.
17.152-17.159 [Reserved]
17.160 Communications.
17.161-17.169 [Reserved]
17.170 Compliance procedures.
17.171-17.999 [Reserved]

    Authority: 29 U.S.C. 794.

    Source: 56 FR 40788, Aug. 16, 1991, unless otherwise noted.



Sec. 17.101  Purpose.

    The purpose of this part is to effectuate section 119 of the 
Rehabilitation, Comprehensive Services, and Developmental Disabilities 
Amendments of 1978, which amended section 504 of the Rehabilitation Act 
of 1973 (``section 504'') to prohibit discrimination on the basis of 
handicap in programs or activities conducted by Executive agencies or 
the United States Postal Service.



Sec. 17.102  Application.

    This part applies to all programs or activities conducted by the 
agency, except for programs or activities conducted outside the United 
States that do not involve individuals with handicaps in the United 
States.



Sec. 17.103  Definitions.

    For purposes of this part, the term--
    (a) Agency means the Department of the Treasury.
    (b) Assistant Attorney General means the Assistant Attorney General, 
Civil Rights Division, United States Department of Justice.
    (c) Auxiliary aids means services or devices that enable persons 
with impaired sensory, manual, or speaking skills to have an equal 
opportunity to participate in, and enjoy the benefits of, programs or 
activities conducted by the agency. For example, auxiliary aids useful 
for persons with impaired vision include readers, Brailled materials, 
audio recordings and other similar services and devices. Auxiliary aids 
useful for persons with impaired hearing include telephone handset 
amplifiers, telephones compatible with hearing aids, telecommunications 
devices for deaf persons (TDD's), interpreters, notetakers, written 
materials and other similar services and devices.
    (d) Complete complaint means a written statement that contains the 
complainant's name and address, and describes the agency's alleged 
discriminatory action in sufficient detail to inform the agency of the 
nature and date of the alleged violation of section 504. It shall be 
signed by the complainant or by someone authorized to do so on his or 
her behalf. Complaints filed on behalf of classes of individuals with 
handicaps shall also identify (where

[[Page 219]]

possible) the alleged victims of discrimination.
    (e) Facility means all or any portion of a building, structure, 
equipment, road, walk, parking lot, rolling stock, or other conveyance, 
or other real or personal property.
    (f) Individual with handicaps means any person who has a physical or 
mental impairment that substantially limits one or more of the 
individual's major life activities, has a record of such an impairment, 
or is regarded as having such an impairment. As used in this definition, 
the phrase: (1) Physical or mental impairment includes: (i) Any 
physiological disorder or condition, cosmetic disfigurement, or 
anatomical loss affecting one or more of the following body systems: 
Neurological; musculoskeletal; special sense organs; respiratory, 
including speech organs, cardiovascular; reproductive, digestive; 
genitourinary; hemic and lymphatic; skin; and endocrine; or (ii) any 
mental or psychological disorder such as mental retardation, organic 
brain syndrome, emotional or mental illness, and specific learning 
disabilities. The term physical or mental impairment includes, but is 
not limited to, such diseases and conditions as orthopedic, visual, 
speech and hearing impairments, cerebral palsy, epilepsy, muscular 
dystrophy, multiple sclerosis, cancer, heart disease, diabetes, mental 
retardation, emotional illness, drug addiction and alcoholism.
    (2) Major life activities includes functions such as caring for 
one's self, performing manual tasks, walking, seeing, hearing, speaking, 
breathing, learning, and working.
    (3) Has a record of such an impairment means has a history of, or 
has been misclassified as having, a mental or physical impairment that 
substantially limits one or more of the individual's major life 
activities.
    (4) Is regarded as having an impairment means--
    (i) Has a physical or mental impairment that does not substantially 
limit major life activities but is treated by the agency as constituting 
such a limitation;
    (ii) Has a physical or mental impairment that substantially limits 
major life activities only as a result of the attitudes of others toward 
such impairment; or
    (iii) Has none of the impairments defined in subparagraph (1) of 
this definition but is treated by the agency as having such an 
impairment.
    (g) Qualified individual with handicaps means--(1) With respect to 
an agency program or activity under which a person is required to 
perform services or to achieve a level of accomplishment, an individual 
with handicaps who meets the essential eligibility requirements and who 
can achieve the purpose of the program or activity without modifications 
in the program or activity that the agency can demonstrate would result 
in a fundamental alteration in the nature of the program; and
    (2) With respect to any other program or activity, an individual 
with handicaps who meets the essential eligibility requirements for 
participation in, or receipt of benefits from, that program or activity; 
and
    (3) For purposes of employment, ``qualified handicapped person'' is 
defined in 29 CFR 1613.702(f), which is made applicable to this part by 
Sec. 17.140.
    (h) Section 504 means section 504 of the Rehabilitation Act of 1973 
(Pub. L. 93-112, 87 Stat. 394 (29 U.S.C. 794)), as amended. As used in 
this part, section 504 applies only to programs or activities conducted 
by Executive agencies and not to federally assisted programs.



Sec. Sec. 17.104-17.109  [Reserved]



Sec. 17.110  Self-evaluation.

    (a) The agency shall, by two years after the effective date of this 
part, evaluate its current policies and practices, and the effects 
thereof, to determine if they meet the requirements of this part. To the 
extent modification of any such policy and practice is required, the 
agency shall proceed to make the necessary modifications.
    (b) The agency shall provide an opportunity to interested persons, 
including individuals with handicaps or organizations representing 
individuals with handicaps, to participate in the self-evaluation 
process.
    (c) The agency shall, until three years following the completion of 
the self-evaluation, maintain on file and make available for public 
inspection:

[[Page 220]]

    (1) A description of areas examined and any problems identified; and
    (2) A description of any modifications made; and
    (3) A list of participants in the self-evaluation process.



Sec. 17.111  Notice.

    The agency shall make available to all Treasury employees, and to 
all interested persons, as appropriate, information regarding the 
provisions of this part and its applicability to the programs or 
activities conducted by the agency, and make such information available 
to them in such a manner as is necessary to apprise them of the 
protections against discrimination assured them by section 504 and this 
part.



Sec. Sec. 17.112-17.129  [Reserved]



Sec. 17.130  General prohibitions against discrimination.

    (a) No qualified individual with handicaps in the United States, 
shall, by reason of his or her handicap, be excluded from the 
participation in, be denied the benefits of, or otherwise be subjected 
to discrimination under any program or activity conducted by the agency.
    (b)(1) The agency, in providing any aid, benefit, or service, may 
not directly or through contractual, licensing, or other arrangements, 
on the basis of handicap--
    (i) Deny a qualified individual with handicaps the opportunity to 
participate in or benefit from the aid, benefit, or service;
    (ii) Afford a qualified individual with handicaps an opportunity to 
participate in or benefit from the aid, benefit, or service that is not 
equal to that afforded others;
    (iii) Provide a qualified individual with handicaps with an aid, 
benefit, or service that is not as effective in affording equal 
opportunity to obtain the same result, to gain the same benefit, or to 
reach the same level of achievement as that provided to others;
    (iv) Provide different or separate aid, benefits or services to 
individuals with handicaps or to any class of individuals with handicaps 
than is provided to others unless such action is necessary to provide 
qualified individuals with handicaps with aid, benefits or services that 
are as effective as those provided to others;
    (v) Deny a qualified individual with handicaps the opportunity to 
participate as a member of planning or advisory boards; or
    (vi) Otherwise limit a qualified individual with handicaps in the 
enjoyment of any right, privilege, advantage, or opportunity enjoyed by 
others receiving the aid, benefit, or service.
    (2) For purposes of this part, aids, benefits, and services, to be 
equally effective, are not required to produce the identical result or 
level of achievement for individuals with handicaps and for 
nonhandicapped persons, but must afford individuals with handicaps equal 
opportunity to obtain the same result, to gain the same benefit, or to 
reach the same level of achievement in the most integrated setting 
appropriate to the individual's needs.
    (3) Even if the agency is permitted, under paragraph (b)(1)(iv) of 
this section, to operate a separate or different program for individuals 
with handicaps or for any class of individuals with handicaps, the 
agency must permit any qualified individual with handicaps who wishes to 
participate in the program that is not separate or different to do so.
    (4) The agency may not, directly or through contractual or other 
arrangements, utilize criteria or methods of administration the purpose 
or effect of which would--
    (i) Subject qualified individuals with handicaps to discrimination 
on the basis of handicap; or
    (ii) Defeat or substantially impair accomplishment of the objectives 
of a program or activity with respect to individuals with handicaps.
    (5) The agency may not, in determining the site or location of a 
facility, make selections the purpose or effect of which would--
    (i) Exclude individuals with handicaps from, deny them the benefits 
of, or otherwise subject them to discrimination under any program or 
activity conducted by the agency; or
    (ii) Defeat or substantially impair the accomplishment of the 
objectives of a program or activity with respect to individuals with 
handicaps.

[[Page 221]]

    (6) The agency, in the selection of procurement contractors, may not 
use criteria that subject qualified individuals with handicaps to 
discrimination on the basis of handicap.
    (7) The agency may not administer a licensing or certification 
program in a manner that subjects qualified individuals with handicaps 
to discrimination on the basis of handicap, nor may the agency establish 
requirements for the programs or activities of licensees or certified 
entities that subject qualified individuals with handicaps to 
discrimination on the basis of handicap. However, the programs or 
activities of entities that are licensed or certified by the agency are 
not, themselves, covered by this part.
    (c) The exclusion of nonhandicapped persons from the benefits of a 
program limited by Federal statute or Executive order to individuals 
with handicaps or the exclusion of a specific class of individuals with 
handicaps from a program limited by Federal statute or Executive order 
to a different class of individuals with handicaps is not prohibited by 
this part.
    (d) The agency shall administer programs and activities in the most 
integrated setting appropriate to the needs of qualified individuals 
with handicaps.



Sec. Sec. 17.131-17.139  [Reserved]



Sec. 17.140  Employment.

    No qualified individual with handicaps shall, on the basis of 
handicap, be subjected to discrimination in employment under any program 
or activity conducted by the Department. The definitions, requirements 
and procedures of section 501 of the Rehabilitation Act of 1973 (29 
U.S.C. 791), as established by the Equal Employment Opportunity 
Commission in 29 CFR part 1613, shall apply to employment of federally 
conducted programs or activities.



Sec. Sec. 17.141-17.148  [Reserved]



Sec. 17.149  Program accessibility: Discrimination prohibited.

    Except as otherwise provided in Sec. 17.150, no qualified 
individual with handicaps shall, because the agency's facilities are 
inaccessible to or unusable by individuals with handicaps, be denied the 
benefits of, be excluded from participation in, or otherwise be 
subjected to discrimination under any program or activity conducted by 
the agency.



Sec. 17.150  Program accessibility; Existing facilities.

    (a) General. The agency shall operate each program or activity so 
that the program or activity, when viewed in its entirety, is readily 
accessible to and usable by individuals with handicaps. This paragraph 
does not require the agency--
    (1) To make structural alterations in each of its existing 
facilities in order to make them accessible to and usable by individuals 
with handicaps where other methods are effective in achieving compliance 
with this section; or
    (2) To take any action that it can demonstrate would result in a 
fundamental alteration in the nature of a program or activity or in 
undue financial and administrative burdens. In those circumstances where 
agency personnel believe that the proposed action would fundamentally 
alter the program or activity or would result in undue financial and 
administrative burdens, the agency has the burden of proving that 
compliance with the Sec. 17.150(a) would result in such alteration or 
burdens. The decision that compliance would result in such alteration or 
burdens must be made by the agency head or his or her designee after 
considering all agency resources available for use in the funding and 
operation of the conducted program or activity and must be accompanied 
by a written statement of the reasons for reaching that conclusion. If 
an action would result in such an alteration or such burdens, the agency 
shall take any other action that would not result in such an alteration 
or such burdens but would nevertheless ensure that individuals with 
handicaps receive the benefits and services of the program or activity.
    (b) Methods. The agency may comply with the requirements of this 
section through such means as redesign of equipment, reassignment of 
services to accessible buildings, assignment of

[[Page 222]]

aides to beneficiaries, home visits, delivery of services at alternate 
accessible sites, alteration of existing facilities and construction of 
new facilities, use of accessible rolling stock, or any other methods 
that result in making its programs or activities readily accessible to 
and usable by individuals with handicaps. The agency, in making 
alterations to existing buildings, shall meet accessibility requirements 
to the extent compelled by the Architectural Barriers Act of 1968, as 
amended (42 U.S.C. 4151-4157), and any regulations implementing it. In 
choosing among available methods for meeting the requirements of this 
section, the agency shall give priority to those methods that offer 
programs and activities to qualified individuals with handicaps in the 
most integrated setting appropriate.
    (c) Time period for compliance. The agency shall comply with the 
obligations established under this section within sixty (60) days of the 
effective date of this part except that where structural changes in 
facilities are undertaken, such changes in facilities are undertaken, 
such changes shall be made within three years of the effective date of 
this part, but in any event as expeditiously as possible.
    (d) Transition plan. In the event that structural changes to 
facilities will be undertaken to achieve program accessibility, the 
agency shall develop within six months of the effective date of this 
part, a transition plan setting forth the steps necessary to complete 
such changes. The agency shall provide an opportunity to interested 
persons, including individuals with handicaps or organizations 
representing individuals with handicaps, to participate in the 
development of the transition plan by submitting comments (both 
telephonic and written). A copy of the transition plan shall be made 
available for public inspection. The plan shall at a minimum--
    (1) Identify physical obstacles in the agency's facilities that 
limit the physical accessibility of its programs or activities to 
individuals with handicaps;
    (2) Describe in detail the methods that will be used to make the 
facilities accessible;
    (3) Specify the schedule for taking the steps necessary to achieve 
compliance with this section and, if the time period of the transition 
plan is longer than one year, identify steps that will be taken during 
each year of the transition period; and
    (4) Indicate the official responsible for implementation of the 
plan.



Sec. 17.151  Program accessibility: New construction and alterations.

    Each building or part of a building that is constructed or altered 
by, on behalf of, or for the use of the agency shall be designed, 
constructed, or altered so as to be readily accessible to and usable by 
individuals with handicaps. The definitions, requirements, and standards 
of the Architectural Barriers Act (42 U.S.C. 4151-4157), as established 
in 41 CFR 101-19.600 through 101-19.607 apply to buildings covered by 
this section.



Sec. Sec. 17.152-17.159  [Reserved]



Sec. 17.160  Communications.

    (a) The agency shall take appropriate steps to effectively 
communicate with applicants, participants, personnel of other Federal 
entities, and members of the public.
    (1) The agency shall furnish appropriate auxiliary aids where 
necessary to afford an individual with handicaps an equal opportunity to 
participate in, and enjoy the benefits of, a program or activity 
conducted by the agency.
    (i) In determining what type of auxiliary aid is necessary, the 
agency shall give primary consideration to the requests of the 
individual with handicaps.
    (ii) The agency need not provide individually prescribed devices, 
readers for personal use or study, or other devices of a personal nature 
to applicants or participants in programs.
    (2) Where the agency communicates with applicants and beneficiaries 
by telephone, the agency shall use telecommunication devices for deaf 
persons (TDD's) or equally effective telecommunication systems to 
communicate with persons with impaired hearing.

[[Page 223]]

    (b) The agency shall make available to interested persons, including 
persons with impaired vision or hearing, information as to the existence 
and location of accessible services, activities, and facilities.
    (c) The agency shall post notices at a primary entrance to each of 
its inaccessible facilities, directing users to an accessible facility, 
or to a location at which they can obtain information about accessible 
facilities. The international symbol for accessibility shall be used at 
each primary entrance of an accessible facility.
    (d) This section does not require the agency to take any action that 
it can demonstrate would result in a fundamental alteration in the 
nature of a program or activity or in undue financial and administrative 
burdens.
    In those circumstances where agency personnel believe that the 
proposed action would fundamentally alter the program or activity or 
would result in undue financial and administrative burdens, the agency 
has the burden of proving that compliance with Sec. 17.160 would result 
in such alteration or burdens. The decision that compliance would result 
in such alteration or burdens must be made by the agency head or his or 
her designee after considering all resources available for use in the 
funding and operation of the conducted program or activity and must be 
accompanied by a written statement of the reasons for reaching that 
conclusion. If an action required to comply with this section would 
result in such an alteration or such burdens, the agency shall take any 
other action that would not result in such an alteration or such burdens 
but would nevertheless ensure that, to the maxium extent possible, 
individuals with handicaps receive the benefits and services of the 
program or activity.



Sec. Sec. 17.161-17.169  [Reserved]



Sec. 17.170  Compliance procedures.

    (a) Except as provided in paragraph (b) of this section, this 
section applies to all allegations of discrimination on the basis of 
handicap in programs and activities conducted by the agency.
    (b) The agency shall process complaints alleging violations of 
section 504 with respect to employment according to the procedures 
established by the Equal Employment Opportunity Commission in 29 CFR 
part 1613 pursuant to section 501 of the Rehabilitation Act of 1973 (29 
U.S.C. 791).
    (c) All other complaints alleging violations of section 504 may be 
sent to the Director, Office of Equal Opportunity Program, Department of 
the Treasury, 1500 Pennsylvania Avenue, NW., Washington, DC 20220. The 
Deputy Assistant Secretary for Departmental Finance and Management shall 
be responsible for coordinating implementation of this section.
    (d)(1) Any person who believes that he or she has been subjected to 
discrimination prohibited by this part may by him or herself or by his 
or her authorized representative file a complaint. Any person who 
believes that any specific class of persons has been subjected to 
discrimination prohibited by this part and who is a member of that class 
or the authorized representative of a member of that class may file a 
complaint.
    (2) The agency shall accept and investigate all complete complaints 
over which it has jurisdiction.
    (3) All complete complaints must be filed within 180 days of the 
alleged act of discrimination. The agency may extend this time period 
for good cause.
    (e) If the agency receive a complaint over which it does not have 
jurisdiction, it shall promptly notify the complainant and shall make 
reasonable efforts to refer the complaint to the appropriate government 
entity.
    (f) The agency shall notify the Architectural and Transportation 
Barriers Compliance Board upon receipt of any complaint alleging that a 
building or facility that is subject to the Architectural Barriers Act 
of 1968, as amended (42 U.S.C. 4151-4157), is not readily accessible to 
and usable by individuals with handicaps.
    (g)(1) Within 180 days of the receipt of a complete complaint over 
which it has jurisdiction, the agency shall notify the complainant of 
the results of the investigation in a letter containing--
    (i) Findings of fact and conclusions of law;
    (ii) A description of a remedy for each violation found; and

[[Page 224]]

    (iii) A notice of the right to appeal.
    (2) Agency employees are required to cooperate in the investigation 
and attempted resolution of complaints. Employees who are required to 
participate in any investigation under this section shall do so as part 
of their official duties and during the course of regular duty hours.
    (3) If a complaint is resolved informally, the terms of the 
agreement shall be reduced to writing and made part of the complaint 
file, with a copy of the agreement provided to the complainant. The 
written agreement shall describe the subject matter of the complaint and 
any corrective action to which the parties have agreed.
    (h) Appeals of the findings of fact and conclusions of law or 
remedies must be filed by the complainant within 60 days of receipt from 
the agency of the letter required by Sec. 17.170(g). The agency may 
extend this time for good cause.
    (i) Timely appeals shall be accepted and processed by the Director, 
Human Resources Directorate, or his or her designee, who will issue the 
final agency decision which may include appropriate corrective action to 
be taken by the agency.
    (j) The agency shall notify the complainant of the results of the 
appeal within 30 days of the receipt of the appeal. If the agency 
determines that it needs additional information from the complainant, it 
shall have 30 days from the date it received the additional information 
to make its determination on the appeal.
    (k) The time limits cited in paragraphs (g) and (j) of this section 
may be extended for an individual case when the Assistant Secretary for 
Departmental Finance and Management determines that there is good cause, 
based on the particular circumstances of that case, for the extension.
    (l) The agency may delegate its authority for conducting complaint 
investigations to other Federal agencies or may contract with a 
nongovernment investigator to perform the investigation, but the 
authority for making the final determination may not be delegated to 
another agency.



Sec. Sec. 17.171-17.999  [Reserved]



PART 18_OFFICIALS DESIGNATED TO PERFORM THE FUNCTIONS AND DUTIES OF 

CERTAIN OFFICES IN CASE OF ABSENCE, DISABILITY, OR VACANCY--Table 
of Contents




Sec.
18.1 Designation of First Assistants.
18.2 Exceptions.

    Authority: 5 U.S.C. 301; 31 U.S.C. 321.

    Source: 64 FR 62112, Nov. 16, 1999, unless otherwise noted.



Sec. 18.1  Designation of First Assistants.

    Except as provided in Sec. 18.2, every office within the Department 
of the Treasury (including its bureaus) to which appointment is required 
to be made by the President with the advice and consent of the Senate 
(``PAS Office'') may have a First Assistant within the meaning of 5 
U.S.C. 3345-3349d.
    (a) Where there is a position of principal deputy to the PAS Office, 
the principal deputy shall be the First Assistant.
    (b) Where there is only one deputy position to the PAS Office, the 
official in that position shall be the First Assistant.
    (c) Where neither paragraph (a) nor (b) of this section is 
applicable to the PAS Office, the Secretary of the Treasury may 
designate in writing the First Assistant.



Sec. 18.2  Exceptions.

    (a) Section 18.1 shall not apply:
    (1) When a statute which meets the requirements of 5 U.S.C. 3347(a) 
prescribes another means for authorizing an officer or employee to 
perform the functions and duties of a PAS Office in the Department 
temporarily in an acting capacity; and
    (2) To the office of a member of the Internal Revenue Service 
Oversight Board.
    (b) The Inspector General of the Department of the Treasury shall 
determine any arrangements for the temporary performance of the 
functions and duties of the Inspector General of the Department of the 
Treasury when that office is vacant.

[[Page 225]]

    (c) The Treasury Inspector General for Tax Administration shall 
determine any arrangements for the temporary performance of the 
functions and duties of the Treasury Inspector General for Tax 
Administration when that office is vacant.



PART 19_GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT)
--Table of Contents




Sec.
19.25 How is this part organized?
19.50 How is this part written?
19.75 Do terms in this part have special meanings?

                            Subpart A_General

19.100 What does this part do?
19.105 Does this part apply to me?
19.110 What is the purpose of the nonprocurement debarment and 
          suspension system?
19.115 How does an exclusion restrict a person's involvement in covered 
          transactions?
19.120 May we grant an exception to let an excluded person participate 
          in a covered transaction?
19.125 Does an exclusion under the nonprocurement system affect a 
          person's eligibility for Federal procurement contracts?
19.130 Does exclusion under the Federal procurement system affect a 
          person's eligibility to participate in nonprocurement 
          transactions?
19.135 May the Department of the Treasury exclude a person who is not 
          currently participating in a nonprocurement transaction?
19.140 How do I know if a person is excluded?
19.145 Does this part address persons who are disqualified, as well as 
          those who are excluded from nonprocurement transactions?

                     Subpart B_Covered Transactions

19.200 What is a covered transaction?
19.205 Why is it important to know if a particular transaction is a 
          covered transaction?
19.210 Which nonprocurement transactions are covered transactions?
19.215 Which nonprocurement transactions are not covered transactions?
19.220 Are any procurement contracts included as covered transactions?
19.225 How do I know if a transaction in which I may participate is a 
          covered transaction?

    Subpart C_Responsibilities of Participants Regarding Transactions

                    Doing Business With Other Persons

19.300 What must I do before I enter into a covered transaction with 
          another person at the next lower tier?
19.305 May I enter into a covered transaction with an excluded or 
          disqualified person?
19.310 What must I do if a Federal agency excludes a person with whom I 
          am already doing business in a covered transaction?
19.315 May I use the services of an excluded person as a principal under 
          a covered transaction?
19.320 Must I verify that principals of my covered transactions are 
          eligible to participate?
19.325 What happens if I do business with an excluded person in a 
          covered transaction?
19.330 What requirements must I pass down to persons at lower tiers with 
          whom I intend to do business?

            Disclosing Information--Primary Tier Participants

19.335 What information must I provide before entering into a covered 
          transaction with the Department of the Treasury?
19.340 If I disclose unfavorable information required under Sec. 
          19.335, will I be prevented from participating in the 
          transaction?
19.345 What happens if I fail to disclose the information required under 
          Sec. 19.335?
19.350 What must I do if I learn of the information required under Sec. 
          19.335 after entering into a covered transaction with the 
          Department of the Treasury?

             Disclosing Information--Lower Tier Participants

19.355 What Information must I provide to a higher tier participant 
          before entering into a covered transaction with that 
          participant?
19.360 What happens if I fail to disclose the information required under 
          Sec. 19.355?
19.365 What must I do if I learn of information required under Sec. 
          19.355 after entering into a covered transaction with a higher 
          tier participant?

   Subpart D_Responsibilities of Department of the Treasury Officials 
                         Regarding Transactions

19.400 May I enter into a transaction with an excluded or disqualified 
          person?
19.405 May I enter into a covered transaction with a participant if a 
          principal of the transaction is excluded?

[[Page 226]]

19.410 May I approve a participant's use of the services of an excluded 
          person?
19.415 What must I do if a Federal agency excludes the participant or a 
          principal after I enter into a covered transaction?
19.420 May I approve a transaction with an excluded or disqualified 
          person at a lower tier?
19.425 When do I check to see if a person is excluded or disqualified?
19.430 How do I check to see if a person is excluded or disqualified?
19.435 What must I require of a primary tier participant?
19.440 What method do I use to communicate those requirements to 
          participants?
19.445 What action may I take if a primary tier participant knowingly 
          does business with an excluded or disqualified person?
19.450 What action may I take if a primary tier participant fails to 
          disclose the information required under Sec. 19.335?
19.455 What may I do if a lower tier participant fails to disclose the 
          information required under Sec. 19.355 to the next higher 
          tier?

                 Subpart E_Excluded Parties List System

19.500 What is the purpose of the Excluded Parties List System (EPLS)?
19.505 Who uses the EPLS?
19.510 Who maintains the EPLS?
19.515 What specific information is in the EPLS?
19.520 Who places the information into the EPLS?
19.525 Whom do I ask if I have questions about a person in the EPLS?
19.530 Where can I find the EPLS?

   Subpart F_General Principles Relating to Suspension and Debarment 
                                 Actions

19.600 How do suspension and debarment actions start?
19.605 How does suspension differ from debarment?
19.610 What procedures does the Department of the Treasury use in 
          suspension and debarment actions?
19.615 How does the Department of the Treasury notify a person of a 
          suspension and debarment action?
19.620 Do Federal agencies coordinate suspension and debarment actions?
19.625 What is the scope of a suspension or debarment action?
19.630 May the Department of the Treasury impute the conduct of one 
          person to another?
19.635 May the Department of the Treasury settle a debarment or 
          suspension action?
19.640 May a settlement include a voluntary exclusion?
19.645 Do other Federal agencies know if the Department of the Treasury 
          agrees to a voluntary exclusion?

                          Subpart G_Suspension

19.700 When may the suspending official issue a suspension?
19.705 What does the suspending official consider in issuing a 
          suspension?
19.710 When does a suspension take effect?
19.715 What notice does the suspending official give me if I am 
          suspended?
19.720 How may I contest a suspension?
19.725 How much time do I have to contest a suspension?
19.730 What information must I provide to the suspending official if I 
          contest a suspension?
19.735 Under what conditions do I get an additional opportunity to 
          challenge the facts on which the suspension is based?
19.740 Are suspension proceedings formal?
19.745 How is fact-finding conducted?
19.750 What does the suspending official consider in deciding whether to 
          continue or terminate my suspension?
19.755 When will I know whether the suspension is continued or 
          terminated?
19.760 How long may my suspension last?

                           Subpart H_Debarment

19.800 What are the causes for debarment?
19.805 What notice does the debarring official give me if I am proposed 
          for debarment?
19.810 When does a debarment take effect?
19.815 How may I contest a proposed debarment?
19.820 How much time do I have to contest a proposed debarment?
19.825 What information must I provide to the debarring official if I 
          contest a proposed debarment?
19.830 Under what conditions do I get an additional opportunity to 
          challenge the facts on which the proposed debarment is based?
19.835 Are debarment proceedings formal?
19.840 How is fact-finding conducted?
19.845 What does the debarring official consider in deciding whether to 
          debar me?
19.850 What is the standard of proof in a debarment action?
19.855 Who has the burden of proof in a debarment action?
19.860 What factors may influence the debarring official's decision?
19.865 How long may my debarment last?
19.870 When do I know if the debarring official debars me?
19.875 May I ask the debarring official to reconsider a decision to 
          debar me?
19.880 What factors may influence the debarring official during 
          reconsideration?
19.885 May the debarring official extend a debarment?

[[Page 227]]

                          Subpart I_Definitions

19.900 Adequate evidence.
19.905 Affiliate.
19.910 Agency.
19.915 Agent or representative.
19.920 Civil judgment.
19.925 Conviction.
19.930 Debarment.
19.935 Debarring official.
19.940 Disqualified.
19.945 Excluded or exclusion.
19.950 Excluded Parties List System.
19.955 Indictment.
19.960 Ineligible or ineligibility.
19.965 Legal proceedings.
19.970 Nonprocurement transaction.
19.975 Notice.
19.980 Participant.
19.985 Person.
19.990 Preponderance of the evidence.
19.995 Principal.
19.1000 Respondent.
19.1005 State.
19.1010 Suspending official.
19.1015 Suspension.
19.1020 Voluntary exclusion or voluntarily excluded.

Subpart J [Reserved]

Appendix to Part 19--Covered Transactions

    Authority: Sec. 2455, Pub. L. 103-355, 108 Stat. 3327 (31 U.S.C. 
6101 note); E.O. 11738 (3 CFR, 1973 Comp., p. 799); E.O. 12549 (3 CFR, 
1986 Comp., p. 189); E.O. 12689 (3 CFR, 1989 Comp., p. 235).

    Source: 68 FR 66544, 66605, 66607, Nov. 26, 2003, unless otherwise 
noted.



Sec. 19.25  How is this part organized?

    (a) This part is subdivided into ten subparts. Each subpart contains 
information related to a broad topic or specific audience with special 
responsibilities, as shown in the following table:

------------------------------------------------------------------------
       In subpart . . .        You will find provisions related to . . .
------------------------------------------------------------------------
A............................  general information about this rule.
B............................  the types of Department of the Treasury
                                transactions that are covered by the
                                Governmentwide nonprocurement suspension
                                and debarment system.
C............................  the responsibilities of persons who
                                participate in covered transactions.
D............................  the responsibilities of Department of the
                                Treasury officials who are authorized to
                                enter into covered transactions.
E............................  the responsibilities of Federal agencies
                                for the Excluded Parties List System
                                (Disseminated by the General Services
                                Administration).
F............................  the general principles governing
                                suspension, debarment, voluntary
                                exclusion and settlement.
G............................  suspension actions.
H............................  debarment actions.
I............................  definitions of terms used in this part.
J............................  [Reserved]
------------------------------------------------------------------------

    (b) The following table shows which subparts may be of special 
interest to you, depending on who you are:

------------------------------------------------------------------------
             If you are . . .                   See subpart(s) . . .
------------------------------------------------------------------------
(1) a participant or principal in a         A, B, C, and I.
 nonprocurement transaction.
(2) a respondent in a suspension action...  A, B, F, G and I.
(3) a respondent in a debarment action....  A, B, F, H and I.
(4) a suspending official.................  A, B, D, E, F, G and I.
(5) a debarring official..................  A, B, D, E, F, H and I.
(6) a (n) Department of the Treasury        A, B, D, E and I.
 official authorized to enter into a
 covered transaction.
(7) Reserved..............................  J.
------------------------------------------------------------------------



Sec. 19.50  How is this part written?

    (a) This part uses a ``plain language'' format to make it easier for 
the general public and business community to use. The section headings 
and text, often in the form of questions and answers, must be read 
together.
    (b) Pronouns used within this part, such as ``I'' and ``you,'' 
change from subpart to subpart depending on the audience being 
addressed. The pronoun ``we'' always is the Department of the Treasury.
    (c) The ``Covered Transactions'' diagram in the appendix to this 
part shows the levels or ``tiers'' at which the Department of the 
Treasury enforces an exclusion under this part.



Sec. 19.75  Do terms in this part have special meanings?

    This part uses terms throughout the text that have special meaning. 
Those terms are defined in Subpart I of this part. For example, three 
important terms are--

[[Page 228]]

    (a) Exclusion or excluded, which refers only to discretionary 
actions taken by a suspending or debarring official under this part or 
the Federal Acquisition Regulation (48 CFR part 9, subpart 9.4);
    (b) Disqualification or disqualified, which refers to prohibitions 
under specific statutes, executive orders (other than Executive Order 
12549 and Executive Order 12689), or other authorities. 
Disqualifications frequently are not subject to the discretion of an 
agency official, may have a different scope than exclusions, or have 
special conditions that apply to the disqualification; and
    (c) Ineligibility or ineligible, which generally refers to a person 
who is either excluded or disqualified.



                            Subpart A_General



Sec. 19.100  What does this part do?

    This part adopts a governmentwide system of debarment and suspension 
for Department of the Treasury nonprocurement activities. It also 
provides for reciprocal exclusion of persons who have been excluded 
under the Federal Acquisition Regulation, and provides for the 
consolidated listing of all persons who are excluded, or disqualified by 
statute, executive order, or other legal authority. This part satisfies 
the requirements in section 3 of Executive Order 12549, ``Debarment and 
Suspension'' (3 CFR 1986 Comp., p. 189), Executive Order 12689, 
``Debarment and Suspension'' (3 CFR 1989 Comp., p. 235) and 31 U.S.C. 
6101 note (Section 2455, Public Law 103-355, 108 Stat. 3327).



Sec. 19.105  Does this part apply to me?

    Portions of this part (see table at Sec. 19.25(b)) apply to you if 
you are a(n)--
    (a) Person who has been, is, or may reasonably be expected to be, a 
participant or principal in a covered transaction;
    (b) Respondent (a person against whom the Department of the Treasury 
has initiated a debarment or suspension action);
    (c) Department of the Treasury debarring or suspending official; or
    (d) Department of the Treasury official who is authorized to enter 
into covered transactions with non-Federal parties.



Sec. 19.110  What is the purpose of the nonprocurement debarment and 
suspension system?

    (a) To protect the public interest, the Federal Government ensures 
the integrity of Federal programs by conducting business only with 
responsible persons.
    (b) A Federal agency uses the nonprocurement debarment and 
suspension system to exclude from Federal programs persons who are not 
presently responsible.
    (c) An exclusion is a serious action that a Federal agency may take 
only to protect the public interest. A Federal agency may not exclude a 
person or commodity for the purposes of punishment.



Sec. 19.115  How does an exclusion restrict a person's involvement in 
covered transactions?

    With the exceptions stated in Sec. Sec. 19.120, 19.315, and 19.420, 
a person who is excluded by the Department of the Treasury or any other 
Federal agency may not:
    (a) Be a participant in a(n) Department of the Treasury transaction 
that is a covered transaction under subpart B of this part;
    (b) Be a participant in a transaction of any other Federal agency 
that is a covered transaction under that agency's regulation for 
debarment and suspension; or
    (c) Act as a principal of a person participating in one of those 
covered transactions.



Sec. 19.120  May we grant an exception to let an excluded person 
participate in a covered transaction?

    (a) The Secretary of the Treasury may grant an exception permitting 
an excluded person to participate in a particular covered transaction. 
If the Secretary of the Treasury grants an exception, the exception must 
be in writing and state the reason(s) for deviating from the 
governmentwide policy in Executive Order 12549.
    (b) An exception granted by one agency for an excluded person does 
not extend to the covered transactions of another agency.

[[Page 229]]



Sec. 19.125  Does an exclusion under the nonprocurement system affect a 
person's eligibility for Federal procurement contracts?

    If any Federal agency excludes a person under its nonprocurement 
common rule on or after August 25, 1995, the excluded person is also 
ineligible to participate in Federal procurement transactions under the 
FAR. Therefore, an exclusion under this part has reciprocal effect in 
Federal procurement transactions.



Sec. 19.130  Does exclusion under the Federal procurement system affect 
a person's eligibility to participate in nonprocurement transactions?

    If any Federal agency excludes a person under the FAR on or after 
August 25, 1995, the excluded person is also ineligible to participate 
in nonprocurement covered transactions under this part. Therefore, an 
exclusion under the FAR has reciprocal effect in Federal nonprocurement 
transactions.



Sec. 19.135  May the Department of the Treasury exclude a person who 
is not currently participating in a nonprocurement transaction?

    Given a cause that justifies an exclusion under this part, we may 
exclude any person who has been involved, is currently involved, or may 
reasonably be expected to be involved in a covered transaction.



Sec. 19.140  How do I know if a person is excluded?

    Check the Excluded Parties List System (EPLS) to determine whether a 
person is excluded. The General Services Administration (GSA) maintains 
the EPLS and makes it available, as detailed in subpart E of this part. 
When a Federal agency takes an action to exclude a person under the 
nonprocurement or procurement debarment and suspension system, the 
agency enters the information about the excluded person into the EPLS.



Sec. 19.145  Does this part address persons who are disqualified, as 
well as those who are excluded from nonprocurement transactions?

    Except if provided for in Subpart J of this part, this part--
    (a) Addresses disqualified persons only to--
    (1) Provide for their inclusion in the EPLS; and
    (2) State responsibilities of Federal agencies and participants to 
check for disqualified persons before entering into covered 
transactions.
    (b) Does not specify the--
    (1) Department of the Treasury transactions for which a disqualified 
person is ineligible. Those transactions vary on a case-by-case basis, 
because they depend on the language of the specific statute, Executive 
order, or regulation that caused the disqualification;
    (2) Entities to which the disqualification applies; or
    (3) Process that the agency uses to disqualify a person. Unlike 
exclusion, disqualification is frequently not a discretionary action 
that a Federal agency takes.



                     Subpart B_Covered Transactions



Sec. 19.200  What is a covered transaction?

    A covered transaction is a nonprocurement or procurement transaction 
that is subject to the prohibitions of this part. It may be a 
transaction at--
    (a) The primary tier, between a Federal agency and a person (see 
appendix to this part); or
    (b) A lower tier, between a participant in a covered transaction and 
another person.



Sec. 19.205  Why is it important if a particular transaction is a covered 
transaction?

    The importance of a covered transaction depends upon who you are.
    (a) As a participant in the transaction, you have the 
responsibilities laid out in Subpart C of this part. Those include 
responsibilities to the person or Federal agency at the next higher tier 
from whom you received the transaction, if any. They also include 
responsibilities if you subsequently enter into other covered 
transactions with persons at the next lower tier.
    (b) As a Federal official who enters into a primary tier 
transaction, you have the responsibilities laid out in subpart D of this 
part.

[[Page 230]]

    (c) As an excluded person, you may not be a participant or principal 
in the transaction unless--
    (1) The person who entered into the transaction with you allows you 
to continue your involvement in a transaction that predates your 
exclusion, as permitted under Sec. 19.310 or Sec. 19.415; or
    (2) A(n) Department of the Treasury official obtains an exception 
from the Secretary of the Treasury to allow you to be involved in the 
transaction, as permitted under Sec. 19.120.



Sec. 19.210  Which nonprocurement transactions are covered transactions?

    All nonprocurement transactions, as defined in Sec. 19.970, are 
covered transactions unless listed in Sec. 19.215. (See appendix to 
this part.)



Sec. 19.215  Which nonprocurement transactions are not covered 
transactions?

    The following types of nonprocurement transactions are not covered 
transactions:
    (a) A direct award to--
    (1) A foreign government or foreign governmental entity;
    (2) A public international organization;
    (3) An entity owned (in whole or in part) or controlled by a foreign 
government; or
    (4) Any other entity consisting wholly or partially of one or more 
foreign governments or foreign governmental entities.
    (b) A benefit to an individual as a personal entitlement without 
regard to the individual's present responsibility (but benefits received 
in an individual's business capacity are not excepted). For example, if 
a person receives social security benefits under the Supplemental 
Security Income provisions of the Social Security Act, 42 U.S.C. 1301 et 
seq., those benefits are not covered transactions and, therefore, are 
not affected if the person is excluded.
    (c) Federal employment.
    (d) A transaction that the Department of the Treasury needs to 
respond to a national or agency-recognized emergency or disaster.
    (e) A permit, license, certificate, or similar instrument issued as 
a means to regulate public health, safety, or the environment, unless 
the Department of the Treasury specifically designates it to be a 
covered transaction.
    (f) An incidental benefit that results from ordinary governmental 
operations.
    (g) Any other transaction if the application of an exclusion to the 
transaction is prohibited by law.



Sec. 19.220  Are any procurement contracts included as covered 
transactions?

    (a) Covered transactions under this part--
    (1) Do not include any procurement contracts awarded directly by a 
Federal agency; but
    (2) Do include some procurement contracts awarded by non-Federal 
participants in nonprocurement covered transactions (see appendix to 
this part).
    (b) Specifically, a contract for goods or services is a covered 
transaction if any of the following applies:
    (1) The contract is awarded by a participant in a nonprocurement 
transaction that is covered under Sec. 19.210, and the amount of the 
contract is expected to equal or exceed $25,000.
    (2) The contract requires the consent of a(n) Department of the 
Treasury official. In that case, the contract, regardless of the amount, 
always is a covered transaction, and it does not matter who awarded it. 
For example, it could be a subcontract awarded by a contractor at a tier 
below a nonprocurement transaction, as shown in the appendix to this 
part.
    (3) The contract is for federally-required audit services.



Sec. 19.225  How do I know if a transaction in which I may participate 
is a covered transaction?

    As a participant in a transaction, you will know that it is a 
covered transaction because the agency regulations governing the 
transaction, the appropriate agency official, or participant at the next 
higher tier who enters into the transaction with you, will tell you that 
you must comply with applicable portions of this part.

[[Page 231]]



    Subpart C_Responsibilities of Participants Regarding Transactions

                    Doing Business With Other Persons



Sec. 19.300  What must I do before I enter into a covered transaction 
with another person at the next lower tier?

    When you enter into a covered transaction with another person at the 
next lower tier, you must verify that the person with whom you intend to 
do business is not excluded or disqualified. You do this by:
    (a) Checking the EPLS; or
    (b) Collecting a certification from that person if allowed by this 
rule; or
    (c) Adding a clause or condition to the covered transaction with 
that person.



Sec. 19.305  May I enter into a covered transaction with an excluded 
or disqualified person?

    (a) You as a participant may not enter into a covered transaction 
with an excluded person, unless the Department of the Treasury grants an 
exception under Sec. 19.120.
    (b) You may not enter into any transaction with a person who is 
disqualified from that transaction, unless you have obtained an 
exception under the disqualifying statute, Executive order, or 
regulation.



Sec. 19.310  What must I do if a Federal agency excludes a person with 
whom I am already doing business in a covered transaction?

    (a) You as a participant may continue covered transactions with an 
excluded person if the transactions were in existence when the agency 
excluded the person. However, you are not required to continue the 
transactions, and you may consider termination. You should make a 
decision about whether to terminate and the type of termination action, 
if any, only after a thorough review to ensure that the action is proper 
and appropriate.
    (b) You may not renew or extend covered transactions (other than no-
cost time extensions) with any excluded person, unless the Department of 
the Treasury grants an exception under Sec. 19.120.



Sec. 19.315  May I use the services of an excluded person as a 
principal under a covered transaction?

    (a) You as a participant may continue to use the services of an 
excluded person as a principal under a covered transaction if you were 
using the services of that person in the transaction before the person 
was excluded. However, you are not required to continue using that 
person's services as a principal. You should make a decision about 
whether to discontinue that person's services only after a thorough 
review to ensure that the action is proper and appropriate.
    (b) You may not begin to use the services of an excluded person as a 
principal under a covered transaction unless the Department of the 
Treasury grants an exception under Sec. 19.120.



Sec. 19.320  Must I verify that principals of my covered transactions 
are eligible to participate?

    Yes, you as a participant are responsible for determining whether 
any of your principals of your covered transactions is excluded or 
disqualified from participating in the transaction. You may decide the 
method and frequency by which you do so. You may, but you are not 
required to, check the EPLS.



Sec. 19.325  What happens if I do business with an excluded person 
in a covered transaction?

    If as a participant you knowingly do business with an excluded 
person, we may disallow costs, annul or terminate the transaction, issue 
a stop work order, debar or suspend you, or take other remedies as 
appropriate.



Sec. 19.330  What requirements must I pass down to persons at lower 
tiers with whom I intend to do business?

    Before entering into a covered transaction with a participant at the 
next lower tier, you must require that participant to--
    (a) Comply with this subpart as a condition of participation in the 
transaction. You may do so using any method(s), unless Sec. 19.440 
requires you to use specific methods.
    (b) Pass the requirement to comply with this subpart to each person 
with whom the participant enters into a

[[Page 232]]

covered transaction at the next lower tier.

            Disclosing Information--Primary Tier Participants



Sec. 19.335  What information must I provide before entering into a 
covered transaction with the Department of the Treasury?

    Before you enter into a covered transaction at the primary tier, you 
as the participant must notify the Department of the Treasury office 
that is entering into the transaction with you, if you know that you or 
any of the principals for that covered transaction:
    (a) Are presently excluded or disqualified;
    (b) Have been convicted within the preceding three years of any of 
the offenses listed in Sec. 19.800(a) or had a civil judgment rendered 
against you for one of those offenses within that time period;
    (c) Are presently indicted for or otherwise criminally or civilly 
charged by a governmental entity (Federal, State or local) with 
commission of any of the offenses listed in Sec. 19.800(a); or
    (d) Have had one or more public transactions (Federal, State, or 
local) terminated within the preceding three years for cause or default.



Sec. 19.340  If I disclose unfavorable information required under 
Sec. 19.335, will I be prevented from participating in the transaction?

    As a primary tier participant, your disclosure of unfavorable 
information about yourself or a principal under Sec. 19.335 will not 
necessarily cause us to deny your participation in the covered 
transaction. We will consider the information when we determine whether 
to enter into the covered transaction. We also will consider any 
additional information or explanation that you elect to submit with the 
disclosed information.



Sec. 19.345  What happens if I fail to disclose information required 
under Sec. 19.335?

    If we later determine that you failed to disclose information under 
Sec. 19.335 that you knew at the time you entered into the covered 
transaction, we may--
    (a) Terminate the transaction for material failure to comply with 
the terms and conditions of the transaction; or
    (b) Pursue any other available remedies, including suspension and 
debarment.



Sec. 19.350  What must I do if I learn of information required under 

Sec. 19.335 after entering into a covered transaction with the 
Department of the 
          Treasury?

    At any time after you enter into a covered transaction, you must 
give immediate written notice to the Department of the Treasury office 
with which you entered into the transaction if you learn either that--
    (a) You failed to disclose information earlier, as required by Sec. 
19.335; or
    (b) Due to changed circumstances, you or any of the principals for 
the transaction now meet any of the criteria in Sec. 19.335.

             Disclosing Information--Lower Tier Participants



Sec. 19.355  What information must I provide to a higher tier participant 
before entering into a covered transaction with that participant?

    Before you enter into a covered transaction with a person at the 
next higher tier, you as a lower tier participant must notify that 
person if you know that you or any of the principals are presently 
excluded or disqualified.



Sec. 19.360  What happens if I fail to disclose the information required 
under Sec. 19.355?

    If we later determine that you failed to tell the person at the 
higher tier that you were excluded or disqualified at the time you 
entered into the covered transaction with that person, we may pursue any 
available remedies, including suspension and debarment.



Sec. 19.365  What must I do if I learn of information required under 

Sec. 19.355 after entering into a covered transaction with a higher 
tier participant?

    At any time after you enter into a lower tier covered transaction 
with a

[[Page 233]]

person at a higher tier, you must provide immediate written notice to 
that person if you learn either that--
    (a) You failed to disclose information earlier, as required by Sec. 
19.355; or
    (b) Due to changed circumstances, you or any of the principals for 
the transaction now meet any of the criteria in Sec. 19.355.



   Subpart D_Responsibilities of Department of the Treasury Officials 
                         Regarding Transactions



Sec. 19.400  May I enter into a transaction with an excluded or 
disqualified person?

    (a) You as an agency official may not enter into a covered 
transaction with an excluded person unless you obtain an exception under 
Sec. 19.120.
    (b) You may not enter into any transaction with a person who is 
disqualified from that transaction, unless you obtain a waiver or 
exception under the statute, Executive order, or regulation that is the 
basis for the person's disqualification.



Sec. 19.405  May I enter into a covered transaction with a participant 
if a principal of the transaction is excluded?

    As an agency official, you may not enter into a covered transaction 
with a participant if you know that a principal of the transaction is 
excluded, unless you obtain an exception under Sec. 19.120.



Sec. 19.410  May I approve a participant's use of the services of an 
excluded person?

    After entering into a covered transaction with a participant, you as 
an agency official may not approve a participant's use of an excluded 
person as a principal under that transaction, unless you obtain an 
exception under Sec. 19.120.



Sec. 19.415  What must I do if a Federal agency excludes the participant 
or a principal after I enter into a covered transaction?

    (a) You as an agency official may continue covered transactions with 
an excluded person, or under which an excluded person is a principal, if 
the transactions were in existence when the person was excluded. You are 
not required to continue the transactions, however, and you may consider 
termination. You should make a decision about whether to terminate and 
the type of termination action, if any, only after a thorough review to 
ensure that the action is proper.
    (b) You may not renew or extend covered transactions (other than no-
cost time extensions) with any excluded person, or under which an 
excluded person is a principal, unless you obtain an exception under 
Sec. 19.120.



Sec. 19.420  May I approve a transaction with an excluded or disqualified 
person at a lower tier?

    If a transaction at a lower tier is subject to your approval, you as 
an agency official may not approve--
    (a) A covered transaction with a person who is currently excluded, 
unless you obtain an exception under Sec. 19.120; or
    (b) A transaction with a person who is disqualified from that 
transaction, unless you obtain a waiver or exception under the statute, 
Executive order, or regulation that is the basis for the person's 
disqualification.



Sec. 19.425  When do I check to see if a person is excluded or 
disqualified?

    As an agency official, you must check to see if a person is excluded 
or disqualified before you--
    (a) Enter into a primary tier covered transaction;
    (b) Approve a principal in a primary tier covered transaction;
    (c) Approve a lower tier participant if agency approval of the lower 
tier participant is required; or
    (d) Approve a principal in connection with a lower tier transaction 
if agency approval of the principal is required.



Sec. 19.430  How do I check to see if a person is excluded or 
disqualified?

    You check to see if a person is excluded or disqualified in two 
ways:
    (a) You as an agency official must check the EPLS when you take any 
action listed in Sec. 19.425.
    (b) You must review information that a participant gives you, as 
required by

[[Page 234]]

Sec. 19.335, about its status or the status of the principals of a 
transaction.



Sec. 19.435  What must I require of a primary tier participant?

    You as an agency official must require each participant in a primary 
tier covered transaction to--
    (a) Comply with subpart C of this part as a condition of 
participation in the transaction; and
    (b) Communicate the requirement to comply with Subpart C of this 
part to persons at the next lower tier with whom the primary tier 
participant enters into covered transactions.



Sec. 19.440  What method do I use to communicate those requirements 
to participants?

    To communicate the requirements, you must include a term or 
condition in the transaction requiring the participants' compliance with 
subpart C of this part and requiring them to include a similar term or 
condition in lower-tier covered transactions.

[68 FR 66607, Nov. 26, 2003]



Sec. 19.445  What action may I take if a primary tier participant 
knowingly does business with an excluded or disqualified person?

    If a participant knowingly does business with an excluded or 
disqualified person, you as an agency official may refer the matter for 
suspension and debarment consideration. You may also disallow costs, 
annul or terminate the transaction, issue a stop work order, or take any 
other appropriate remedy.



Sec. 19.450  What action may I take if a primary tier participant fails to 
disclose the information required under Sec. 19.335?

    If you as an agency official determine that a participant failed to 
disclose information, as required by Sec. 19.335, at the time it 
entered into a covered transaction with you, you may--
    (a) Terminate the transaction for material failure to comply with 
the terms and conditions of the transaction; or
    (b) Pursue any other available remedies, including suspension and 
debarment.



Sec. 19.455  What may I do if a lower tier participant fails to disclose 
the information required under Sec. 19.355 to the next higher tier?

    If you as an agency official determine that a lower tier participant 
failed to disclose information, as required by Sec. 19.355, at the time 
it entered into a covered transaction with a participant at the next 
higher tier, you may pursue any remedies available to you, including the 
initiation of a suspension or debarment action.



                 Subpart E_Excluded Parties List System



Sec. 19.500  What is the purpose of the Excluded Parties List System 
(EPLS)?

    The EPLS is a widely available source of the most current 
information about persons who are excluded or disqualified from covered 
transactions.



Sec. 19.505  Who uses the EPLS?

    (a) Federal agency officials use the EPLS to determine whether to 
enter into a transaction with a person, as required under Sec. 19.430.
    (b) Participants also may, but are not required to, use the EPLS to 
determine if--
    (1) Principals of their transactions are excluded or disqualified, 
as required under Sec. 19.320; or
    (2) Persons with whom they are entering into covered transactions at 
the next lower tier are excluded or disqualified.
    (c) The EPLS is available to the general public.



Sec. 19.510  Who maintains the EPLS?

    In accordance with the OMB guidelines, the General Services 
Administration (GSA) maintains the EPLS. When a Federal agency takes an 
action to exclude a person under the nonprocurement or procurement 
debarment and suspension system, the agency enters the information about 
the excluded person into the EPLS.



Sec. 19.515  What specific information is in the EPLS?

    (a) At a minimum, the EPLS indicates--

[[Page 235]]

    (1) The full name (where available) and address of each excluded or 
disqualified person, in alphabetical order, with cross references if 
more than one name is involved in a single action;
    (2) The type of action;
    (3) The cause for the action;
    (4) The scope of the action;
    (5) Any termination date for the action;
    (6) The agency and name and telephone number of the agency point of 
contact for the action; and
    (7) The Dun and Bradstreet Number (DUNS), or other similar code 
approved by the GSA, of the excluded or disqualified person, if 
available.
    (b)(1) The database for the EPLS includes a field for the Taxpayer 
Identification Number (TIN) (the social security number (SSN) for an 
individual) of an excluded or disqualified person.
    (2) Agencies disclose the SSN of an individual to verify the 
identity of an individual, only if permitted under the Privacy Act of 
1974 and, if appropriate, the Computer Matching and Privacy Protection 
Act of 1988, as codified in 5 U.S.C. 552(a).



Sec. 19.520  Who places the information into the EPLS?

    Federal officials who take actions to exclude persons under this 
part or officials who are responsible for identifying disqualified 
persons must enter the following information about those persons into 
the EPLS:
    (a) Information required by Sec. 19.515(a);
    (b) The Taxpayer Identification Number (TIN) of the excluded or 
disqualified person, including the social security number (SSN) for an 
individual, if the number is available and may be disclosed under law;
    (c) Information about an excluded or disqualified person, generally 
within five working days, after--
    (1) Taking an exclusion action;
    (2) Modifying or rescinding an exclusion action;
    (3) Finding that a person is disqualified; or
    (4) Finding that there has been a change in the status of a person 
who is listed as disqualified.



Sec. 19.525  Whom do I ask if I have questions about a person in the EPLS?

    If you have questions about a person in the EPLS, ask the point of 
contact for the Federal agency that placed the person's name into the 
EPLS. You may find the agency point of contact from the EPLS.



Sec. 19.530  Where can I find the EPLS?

    (a) You may access the EPLS through the Internet, currently at 
http://epls.arnet.gov.
    (b) As of November 26, 2003, you may also subscribe to a printed 
version. However, we anticipate discontinuing the printed version. Until 
it is discontinued, you may obtain the printed version by purchasing a 
yearly subscription from the Superintendent of Documents, U.S. 
Government Printing Office, Washington, DC 20402, or by calling the 
Government Printing Office Inquiry and Order Desk at (202) 783-3238.



   Subpart F_General Principles Relating to Suspension and Debarment 
                                 Actions



Sec. 19.600  How do suspension and debarment actions start?

    When we receive information from any source concerning a cause for 
suspension or debarment, we will promptly report and investigate it. We 
refer the question of whether to suspend or debar you to our suspending 
or debarring official for consideration, if appropriate.



Sec. 19.605  How does suspension differ from debarment?

    Suspension differs from debarment in that--

------------------------------------------------------------------------
      A suspending official . . .           A debarring official . . .
------------------------------------------------------------------------
(a) Imposes suspension as a temporary    Imposes debarment for a
 status of ineligibility for              specified period as a final
 procurement and nonprocurement           determination that a person is
 transactions, pending completion of an   not presently responsible.
 investigation or legal proceedings.

[[Page 236]]

 
(b) Must--.............................  Must conclude, based on a
(1) Have adequate evidence that there     preponderance of the evidence,
 may be a cause for debarment of a        that the person has engaged in
 person; and.                             conduct that warrants
(2) Conclude that immediate action is     debarment.
 necessary to protect the Federal
 interest.
(c) Usually imposes the suspension       Imposes debarment after giving
 first, and then promptly notifies the    the respondent notice of the
 suspended person, giving the person an   action and an opportunity to
 opportunity to contest the suspension    contest the proposed
 and have it lifted.                      debarment.
------------------------------------------------------------------------



Sec. 19.610  What procedures does the Department of the Treasury use 
in suspension and debarment actions?

    In deciding whether to suspend or debar you, we handle the actions 
as informally as practicable, consistent with principles of fundamental 
fairness.
    (a) For suspension actions, we use the procedures in this subpart 
and subpart G of this part.
    (b) For debarment actions, we use the procedures in this subpart and 
subpart H of this part.



Sec. 19.615  How does the Department of the Treasury notify a person 
of a suspension or debarment action?

    (a) The suspending or debarring official sends a written notice to 
the last known street address, facsimile number, or e-mail address of--
    (1) You or your identified counsel; or
    (2) Your agent for service of process, or any of your partners, 
officers, directors, owners, or joint venturers.
    (b) The notice is effective if sent to any of these persons.



Sec. 19.620  Do Federal agencies coordinate suspension and debarment 
actions?

    Yes, when more than one Federal agency has an interest in a 
suspension or debarment, the agencies may consider designating one 
agency as the lead agency for making the decision. Agencies are 
encouraged to establish methods and procedures for coordinating their 
suspension and debarment actions.



Sec. 19.625  What is the scope of a suspension or debarment?

    If you are suspended or debarred, the suspension or debarment is 
effective as follows:
    (a) Your suspension or debarment constitutes suspension or debarment 
of all of your divisions and other organizational elements from all 
covered transactions, unless the suspension or debarment decision is 
limited--
    (1) By its terms to one or more specifically identified individuals, 
divisions, or other organizational elements; or
    (2) To specific types of transactions.
    (b) Any affiliate of a participant may be included in a suspension 
or debarment action if the suspending or debarring official--
    (1) Officially names the affiliate in the notice; and
    (2) Gives the affiliate an opportunity to contest the action.



Sec. 19.630  May the Department of the Treasury impute conduct of one 
person to another?

    For purposes of actions taken under this rule, we may impute conduct 
as follows:
    (a) Conduct imputed from an individual to an organization. We may 
impute the fraudulent, criminal, or other improper conduct of any 
officer, director, shareholder, partner, employee, or other individual 
associated with an organization, to that organization when the improper 
conduct occurred in connection with the individual's performance of 
duties for or on behalf of that organization, or with the organization's 
knowledge, approval or acquiescence. The organization's acceptance of 
the benefits derived from the conduct is evidence of knowledge, approval 
or acquiescence.
    (b) Conduct imputed from an organization to an individual, or 
between individuals. We may impute the fraudulent, criminal, or other 
improper conduct of any organization to an individual, or from one 
individual to another individual, if the individual to whom the improper 
conduct is imputed either participated in, had knowledge of, or

[[Page 237]]

reason to know of the improper conduct.
    (c) Conduct imputed from one organization to another organization. 
We may impute the fraudulent, criminal, or other improper conduct of one 
organization to another organization when the improper conduct occurred 
in connection with a partnership, joint venture, joint application, 
association or similar arrangement, or when the organization to whom the 
improper conduct is imputed has the power to direct, manage, control or 
influence the activities of the organization responsible for the 
improper conduct. Acceptance of the benefits derived from the conduct is 
evidence of knowledge, approval or acquiescence.



Sec. 19.635  May the Department of the Treasury settle a debarment 
or suspension action?

    Yes, we may settle a debarment or suspension action at any time if 
it is in the best interest of the Federal Government.



Sec. 19.640  May a settlement include a voluntary exclusion?

    Yes, if we enter into a settlement with you in which you agree to be 
excluded, it is called a voluntary exclusion and has governmentwide 
effect.



Sec. 19.645  Do other Federal agencies know if the Department of the 
Treasury agrees to a voluntary exclusion?

    (a) Yes, we enter information regarding a voluntary exclusion into 
the EPLS.
    (b) Also, any agency or person may contact us to find out the 
details of a voluntary exclusion.



                          Subpart G_Suspension



Sec. 19.700  When may the suspending official issue a suspension?

    Suspension is a serious action. Using the procedures of this subpart 
and subpart F of this part, the suspending official may impose 
suspension only when that official determines that--
    (a) There exists an indictment for, or other adequate evidence to 
suspect, an offense listed under Sec. 19.800(a), or
    (b) There exists adequate evidence to suspect any other cause for 
debarment listed under Sec. 19.800(b) through (d); and
    (c) Immediate action is necessary to protect the public interest.



Sec. 19.705  What does the suspending official consider in issuing a 
suspension?

    (a) In determining the adequacy of the evidence to support the 
suspension, the suspending official considers how much information is 
available, how credible it is given the circumstances, whether or not 
important allegations are corroborated, and what inferences can 
reasonably be drawn as a result. During this assessment, the suspending 
official may examine the basic documents, including grants, cooperative 
agreements, loan authorizations, contracts, and other relevant 
documents.
    (b) An indictment, conviction, civil judgment, or other official 
findings by Federal, State, or local bodies that determine factual and/
or legal matters, constitutes adequate evidence for purposes of 
suspension actions.
    (c) In deciding whether immediate action is needed to protect the 
public interest, the suspending official has wide discretion. For 
example, the suspending official may infer the necessity for immediate 
action to protect the public interest either from the nature of the 
circumstances giving rise to a cause for suspension or from potential 
business relationships or involvement with a program of the Federal 
Government.



Sec. 19.710  When does a suspension take effect?

    A suspension is effective when the suspending official signs the 
decision to suspend.



Sec. 19.715  What notice does the suspending official give me if I 
am suspended?

    After deciding to suspend you, the suspending official promptly 
sends you a Notice of Suspension advising you--
    (a) That you have been suspended;
    (b) That your suspension is based on--
    (1) An indictment;
    (2) A conviction;
    (3) Other adequate evidence that you have committed irregularities 
which

[[Page 238]]

seriously reflect on the propriety of further Federal Government 
dealings with you; or
    (4) Conduct of another person that has been imputed to you, or your 
affiliation with a suspended or debarred person;
    (c) Of any other irregularities in terms sufficient to put you on 
notice without disclosing the Federal Government's evidence;
    (d) Of the cause(s) upon which we relied under Sec. 19.700 for 
imposing suspension;
    (e) That your suspension is for a temporary period pending the 
completion of an investigation or resulting legal or debarment 
proceedings;
    (f) Of the applicable provisions of this subpart, Subpart F of this 
part, and any other Department of the Treasury procedures governing 
suspension decision making; and
    (g) Of the governmentwide effect of your suspension from procurement 
and nonprocurement programs and activities.



Sec. 19.720  How may I contest a suspension?

    If you as a respondent wish to contest a suspension, you or your 
representative must provide the suspending official with information in 
opposition to the suspension. You may do this orally or in writing, but 
any information provided orally that you consider important must also be 
submitted in writing for the official record.



Sec. 19.725  How much time do I have to contest a suspension?

    (a) As a respondent you or your representative must either send, or 
make rrangements to appear and present, the information and argument to 
the suspending official within 30 days after you receive the Notice of 
Suspension.
    (b) We consider the notice to be received by you--
    (1) When delivered, if we mail the notice to the last known street 
address, or five days after we send it if the letter is undeliverable;
    (2) When sent, if we send the notice by facsimile or five days after 
we send it if the facsimile is undeliverable; or
    (3) When delivered, if we send the notice by e-mail or five days 
after we send it if the e-mail is undeliverable.



Sec. 19.730  What information must I provide to the suspending official 
if I contest a suspension?

    (a) In addition to any information and argument in opposition, as a 
respondent your submission to the suspending official must identify--
    (1) Specific facts that contradict the statements contained in the 
Notice of Suspension. A general denial is insufficient to raise a 
genuine dispute over facts material to the suspension;
    (2) All existing, proposed, or prior exclusions under regulations 
implementing E.O. 12549 and all similar actions taken by Federal, state, 
or local agencies, including administrative agreements that affect only 
those agencies;
    (3) All criminal and civil proceedings not included in the Notice of 
Suspension that grew out of facts relevant to the cause(s) stated in the 
notice; and
    (4) All of your affiliates.
    (b) If you fail to disclose this information, or provide false 
information, the Department of the Treasury may seek further criminal, 
civil or administrative action against you, as appropriate.



Sec. 19.735  Under what conditions do I get an additional opportunity 
to challenge the facts on which the suspension is based?

    (a) You as a respondent will not have an additional opportunity to 
challenge the facts if the suspending official determines that--
    (1) Your suspension is based upon an indictment, conviction, civil 
judgment, or other finding by a Federal, State, or local body for which 
an opportunity to contest the facts was provided;
    (2) Your presentation in opposition contains only general denials to 
information contained in the Notice of Suspension;
    (3) The issues raised in your presentation in opposition to the 
suspension are not factual in nature, or are not material to the 
suspending official's initial decision to suspend, or the official's 
decision whether to continue the suspension; or

[[Page 239]]

    (4) On the basis of advice from the Department of Justice, an office 
of the United States Attorney, a State attorney general's office, or a 
State or local prosecutor's office, that substantial interests of the 
government in pending or contemplated legal proceedings based on the 
same facts as the suspension would be prejudiced by conducting fact-
finding.
    (b) You will have an opportunity to challenge the facts if the 
suspending official determines that--
    (1) The conditions in paragraph (a) of this section do not exist; 
and
    (2) Your presentation in opposition raises a genuine dispute over 
facts material to the suspension.
    (c) If you have an opportunity to challenge disputed material facts 
under this section, the suspending official or designee must conduct 
additional proceedings to resolve those facts.



Sec. 19.740  Are suspension proceedings formal?

    (a) Suspension proceedings are conducted in a fair and informal 
manner. The suspending official may use flexible procedures to allow you 
to present matters in opposition. In so doing, the suspending official 
is not required to follow formal rules of evidence or procedure in 
creating an official record upon which the official will base a final 
suspension decision.
    (b) You as a respondent or your representative must submit any 
documentary evidence you want the suspending official to consider.



Sec. 19.745  How is fact-finding conducted?

    (a) If fact-finding is conducted--
    (1) You may present witnesses and other evidence, and confront any 
witness presented; and
    (2) The fact-finder must prepare written findings of fact for the 
record.
    (b) A transcribed record of fact-finding proceedings must be made, 
unless you as a respondent and the Department of the Treasury agree to 
waive it in advance. If you want a copy of the transcribed record, you 
may purchase it.



Sec. 19.750  What does the suspending official consider in deciding 
whether to continue or terminate my suspension?

    (a) The suspending official bases the decision on all information 
contained in the official record. The record includes--
    (1) All information in support of t