CODE OF FEDERAL REGULATIONS31
CONTAINING
A CODIFICATION OF DOCUMENTS
OF GENERAL APPLICABILITY
AND FUTURE EFFECT
Published by
the Office of the Federal Register
National Archives and Records
Administration
as a Special Edition of
the Federal Register
For sale by U.S. Government Printing Office
Superintendent of Documents, Mail Stop: SSOP, Washington, DC 20402-9328
Cite this Code:
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
Title 17 through Title 27
Title 28 through Title 41
Title 42 through Title 50
The appropriate revision date is printed on the cover of each volume.
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).
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, 1998), 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 the daily Federal Register. These two lists will identify the Federal Register page number of the latest amendment of any given rule.
Each volume of the Code contains amendments published in the Federal Register since the last revision of that volume of the Code. Source citations for the regulations are referred to by volume number and page number of the Federal Register and date of publication. Publication dates and effective dates are usually not the same and care must be exercised by the user in determining the actual effective date. In 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.
The Paperwork Reduction Act of 1980 (Pub. L. 96-511) requires Federal agencies to display an OMB control number with their information collection request.
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, 1986, consult either the List of CFR Sections Affected, 1949-1963, 1964-1972, or 1973-1985, published in seven separate volumes. For the period beginning January 1, 1986, a “List of CFR Sections Affected” is published at the end of each CFR volume.
(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.
A subject index to the Code of Federal Regulations is contained in a separate volume, revised annually as of January 1, entitled CFR
An index to the text of “Title 3—The President” is carried within that volume.
The Federal Register Index is issued monthly in cumulative form. This index is based on a consolidation of the “Contents” entries in the daily Federal Register.
A List of CFR Sections Affected (LSA) is published monthly, keyed to the revision dates of the 50 CFR titles.
There are no restrictions on the republication of material appearing in the Code of Federal Regulations.
For a legal interpretation or explanation of any regulation in this volume, contact the issuing agency. The issuing agency's name appears at the top of odd-numbered pages.
For inquiries concerning CFR reference assistance, call 202-523-5227 or write to the Director, Office of the Federal Register, National Archives and Records Administration, Washington, DC 20408.
The Government Printing Office (GPO) processes all sales and distribution of the CFR. For payment by credit card, call 202-512-1800, M-F, 8 a.m. to 4 p.m. e.s.t. or fax your order to 202-512-2233, 24 hours a day. For payment by check, write to the Superintendent of Documents, Attn: New Orders, P.O. Box 371954, Pittsburgh, PA 15250-7954. For GPO Customer Service call 202-512-1803.
The full text of the Code of Federal Regulations, The United States Government Manual, the Federal Register, Public Laws, Weekly Compilation of Presidential Documents and the Privacy Act Compilation are available in electronic format at www.access.gpo.gov/nara (``GPO Access''). For more information, contact Electronic Information Dissemination Services, U.S. Government Printing Office. Phone 202-512-1530, or 888-293-6498 (toll-free). E-mail, gpoaccess@gpo.gov.
The Office of the Federal Register also offers a free service on the National Archives and Records Administration's (NARA) World Wide Web site for public law numbers, Federal Register finding aids, and related information. Connect to NARA's web site at www.nara.gov/fedreg. The NARA site also contains links to GPO Access.
Title 31—
A redesignation table for subtitle A—Office of the Secretary of the Treasury appears in the Finding Aids section of the first volume.
For this volume, Karen A. Thornton was Chief Editor. The Code of Federal Regulations publication program is under the direction of Frances D. McDonald, assisted by Alomha S. Morris.
5 U.S.C. 301.
(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.
(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 and after consideration of the employee's
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 § 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)
(d)
(e)
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.
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.
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
(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.
(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.
(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.
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.
Employees shall not strike against the Government.
(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
(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,
(d) All foreign gifts must be reported as prescribed in the Treasury Directive on Foreign Gifts (Treasury Directive 61-04).
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.
(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
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)).
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.
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.
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).
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
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.
(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).
Employees shall not engage in criminal, infamous, dishonest, or notoriously disgraceful conduct, or any other conduct prejudicial to the Government.
(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.
(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.
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).
(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.
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 § 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.
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.
(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 (§ 0.206), conduct (§ 0.211 and § 0.213), and gifts or gratuities from Foreign governments (§ 0.203).
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.
(a)
(b) As used in this subpart, the following terms shall have the following meanings:
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(c) Components of the Department of the Treasury shall comply with the time limits set forth in the FOIA for responding to and processing requests and appeals, unless there are exceptional circumstances within the meaning of 5 U.S.C. 552(a)(6)(C). A component shall notify a requester whenever the component is unable to respond to or process the request or appeal within the time limits established by the FOIA. Components shall respond to and process requests and appeals in their approximate order of receipt, to the extent consistent with sound administrative practice.
(d)
(1) The Departmental Offices, which include the offices of:
(i) The Secretary of the Treasury, including immediate staff;
(ii) The Deputy Secretary of the Treasury, including immediate staff;
(iii) The Under Secretary of the Treasury for Finance, including immediate staff;
(iv) The Fiscal Assistant Secretary, including immediate staff;
(v) The Assistant Secretary of the Treasury for Ecnomic Policy and all other offices reporting to such official, including immediate staff;
(vi) The General Counsel and also the Legal Division, except legal counsel to the components listed in paragraphs (d)(1)(ix) and (2) through (12) of this section;
(vii) The Assistant Secretary of the Treasury for International Affairs and all offices reporting to such official, including immediate staff;
(viii) The Treasuer of the United States, including immediate staff;
(ix) The Assistant Secretary of the Treasury for Tax policy, including immediate staff and all offices reporting to such official;
(x) The Assistant Secretary of the Treasury for Management, and all offices reporting to such official, including immediate staff.
(xi) The Assistant Secretary of the Treasury for Domestic Finance and all offices reporting to such official, including immediate staff;
(xii) The Assistant Secretary of the Treasury for Legislative Affairs, including immediate staff;
(xiii) The Assistant Secretary of the Treasury for Public Affairs and Public Liaison, including immediate staff;
(xiv) The Assistant Secretary of the Treasury for Enforcement and all offices reporting to such official, including immediate staff;
(xv) The Special Assistant to the Secretary (National Security), including immediate staff;
(xvi) The Inspector General and all offices reporting to such official, including immediate office.
(2) The Bureau of Alcohol, Tobacco and Firearms;
(3) The Office of the Comptroller of the Currency;
(4) The United States Customs Service;
(5) The Bureau of Engraving and Printing;
(6) The Federal Law Enforcement Training Center;
(7) The Financial Management Service;
(8) The Internal Revenue Service;
(9) The United States Mint;
(10) The Bureau of the Public Debt;
(11) The United States Savings Bonds Division;
(12) The United States Secret Service;
(13) The Office of Thrift Supervision.
(a)
(1) Information required to be published in the
(2) Information required to be made available for public inspection and copying or, in the alternative, to be published and offered for sale (see § 1.4 of this part); and
(3) Information required to be made available to any member of the public upon specific request (see § 1.5 of this part). The provisions of section 552 are intended to assure the right of the public to information.
(b) Subject only to the exemptions set forth in § 1.2(c), the public generally or any member of the public shall be afforded access to information or records in the possession of any component of the Department of the Treasury. Such access shall be governed by the regulations in this Subpart A and any regulations of a component implementing or supplementing them.
(c)
(i)(A) Specifically authorized under criteria established by an Executive order to be kept secret in the interest of the national defense or foreign policy and (B) are in fact properly classified pursuant to such Executive order (See 31 CFR part 2);
(ii) Related solely to the internal personnel rules and practices of an agency;
(iii) Specifically exempted from disclosure by statute (other, than 5 U.S.C. 552(b)):
(iv) Trade secrets and commercial or financial information obtained from a person and privileged or confidential;
(v) Inter-agency or intra-agency memorandums or letters which would not be available by law to a party other than an agency in litigation with the agency;
(vi) Personnel and medical files and similar files the disclosure of which would constitute a clearly unwarranted invasion of personal privacy;
(vii) Records or information compiled for law enforcement purposes, but only to the extent that the production of such law enforcement records or information (A) could reasonably be expected to interfere with enforcement proceedings (see § 1.2(c)(2); (B) would deprive a person of a right to a fair trial or an impartial adjudication; (C) could reasonably be expected to constitute an unwarranted invasion of personal privacy; (D) could reasonably be expected to disclose the identity of a confidential source including a State, local, or foreign agency or authority or any private institution which furnished information on a confidential basis, and, in the case of a record or information compiled by criminal law enforcement authority in the course of a criminal investigation or by an agency conducting a lawful national security intelligence investigation, information furnished by a confidential source; (E) would disclose techniques and procedures for law enforcement investigations or prosecutions, or would disclose guidelines for law enforcement investigations or prosecutions if such disclosure could reasonably be expected to risk circumvention of the law; or (F) could reasonably be expected to endanger the life or physical safety of any individual.
(viii) Contained in or related to examination, operating or condition reports prepared by, on behalf of, or for the use of an agency responsible for the regulation or supervision of financial institutions; or
(ix) Geological and geophysical information and data, including maps, concerning wells.
(2)(i) Whenever a request is made which involves access to records described in § 1.2(c)(1)(vii)(A), and—
(A) The investigation or proceeding involves a possible violation of criminal law; and
(B) There is a reason to believe that the subject of the investigation or proceeding is not aware of its pendency, and disclosure of the existence of the records could reasonably be expected to interfere with enforcement proceedings, the agency may, during only such time as that circumstance continues, treat the records as not subject to the requirements of this section.
(ii) Whenever informant records maintained by a criminal law enforcement agency under an informant's name or personal identifier are requested by a third party according to the informant's name or personal identifier, the agency may treat the records as not subject to the requirements of this section unless the informant's status as an informant has been officially confirmed.
(iii) Whenever a request is made which involves access to records maintained by the Federal Bureau of Investigation pertaining to foreign intelligence or counterintelligence, or international terrorism, and the existence of the records is classified information as provided in paragraph (b)(1) of this section, the Bureau may, as long as the existence of the records remains classified information, treat the records as not subject to the requirements of this section.
(3) The exemptions set forth in paragraph (c)(1) of this section apply to each of the three categories of information set forth in paragraph (a) of this section.
(4)
(5)
(a)
(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 component; and
(5) Each amendment, revision, or repeal of matters referred to in paragraphs (a)(1) through (4) of this section.
(b)
(2)
(a)
(1) Final opinions, including concurring and dissenting opinions, and orders, if such opinions and orders are made in the adjudication of cases;
(2) Those statements of policy and interpretation which have been adopted by the component but are not published in the
(3) Its administrative staff manuals and instructions to staff that affect a member of the public.
(b)
(c)
(d)
(e)
(a)
(b)
(2) When an unclassified record created by another agency or another Treasury component is in the possession of a component of the Department of the Treasury, and that record is requested under the FOIA, the responsible Treasury official shall refer the record to the agency or Treasury component originating the record for a direct response to the requester. The requester shall be informed of the referral. However, where it is determined that the record is exempt from disclosure under the provisions of the FOIA (5 U.S.C. 552) and will be withheld from disclosure, the referral need not be made. In such an instance, the component of the Department that maintains the records shall inform the requester of the applicable appeal rights and shall notify the agency or component that originated the record(s) of the request and the determination not to release the record(s). If there is any subsequent change in this initial determination, the documents shall be referred to the originating agency or component for response to the requester.
(3) When a classified record originated by another agency or another component of the Department is in the possession of a component of the Department of the Treasury, and a FOIA request for that record is received, the request shall be referred to the originating Department, agency, or component of the Department for a direct response. This is not a denial of a FOIA
(4) When a FOIA request is received for a record created by a component of the Department that includes information originated by another component of the Department or another agency, the record shall be referred to the originating agency or component of the Department for review, coordination, and concurrence. The Department component shall not release any records without prior consultation with the other component or agency.
(5) In certain instances and at the discretion of the Departmental Offices, requests having impact on two or more components of the Department shall be coordinated by the Departmental Offices.
(c)
(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 these regulations. A request for records shall also state how the documents released will be used (See § 1.7(a)). The Departmental components may determine from the use specified in the request that the requester is a commercial user. 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. Moreover, where a component of the Department 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, components should seek additional clarification before assigning the request to a specific category.
(2) The request shall identify whether the requester is an educational institution, non-commercial scientific institution, or representative of the news media subject to the fee provisions described in § 1.7.
(i) These categories of requesters are defined as follows:
(A)
(B)
(C)
(3) The request must be addressed to the component that maintains the record. The request should be sent to the component at its proper address. Both the envelope and the request itself should be clearly marked “Freedom of Information Act Request,” and
(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; and
(7) The request must state the firm agreement of the requester to pay the fees for duplication, search, and/or review as may ultimately be determined in accordance with § 1.7, or request that such fees be reduced or waived and state the justification for such request (see § 1.7(d)). The requester shall be promptly advised of the estimate of fees due and asked to agree to pay this amount, when:
(i) The initial request does not state a firm agreement to pay fees, but instead places an upper limit on the amount the requester agrees to pay, and this upper limit exceeds the limitations in § 1.7(a) (for example, the first 100 pages of reproduction and the first two hours of search time are furnished without charge, etc.), and is likely to be lower than the fees ultimately estimated to be due; or
(ii) The request is determined to be for a commercial use; or
(iii) The requester asks for an estimate of the fees to be charged; or
(iv) When the estimated fee is below $250 but above the upper level set by the requester; or
(v) Whenever the estimate is above $250 whether or not an upper level is set.
(d)
(2) The Department of the Treasury will make every reasonable effort to comply fully with all requests for access to records subject only to any applicable exemption set forth in § 1.2(c). However, in any situation in which it is determined that a request for voluminous records would unduly burden and interfere with the operations of a component, the person making the request will be asked to be more specific
(e)
(1) The requirements of paragraph (c) of this section have been satisfied, and, where applicable,
(2) The requester has agreed in writing, to pay the fees for search, duplication, and review determined due in accordance with § 1.7, or
(3) The fees have been waived in accordance with § 1.7(d), or
(4) Payment in advance has been received from the requester, when required in accordance with § 1.7(f). Requests for records, including prepayment, shall be promptly stamped with the date of receipt by the office prescribed in the appropriate appendix. A final notification of waiver of fees will be stamped with the date of transmittal by the appropriate office. For purposes of this subpart, the date of receipt of the request is the lastest of these stamped dates. As soon as the date of receipt has been established, the requester shall be so informed. At this time the requester will also be advised when to expect a response within the time limits specified in paragraph (g)(1) of this section, unless extended as provided in paragraph (i)(1) of this section.
(f)
(g)
(2)
(3)
(4)
(h)
(i) Be made in writing and signed by the requester;
(ii) Be addressed to and mailed or hand delivered, within 35 days of the date of the initial determination, 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) Reasonably describe, in accordance with paragraph (d) of this section, the records requested from the denial of access to which an appeal is being taken;
(iv) Set forth the address where the requester desires to be notified of the determination on appeal;
(v) Specify the date of the initial request and date of the letter denying the initial request; and
(vi) Petition such official to grant the request for records and state any supporting arguments.
(2) Appeals shall be promptly stamped with the date of their receipt by the office to which addressed. This stamped date will be considered to be the date of receipt for all purposes of this subpart. The receipt of the appeal shall be acknowledged by the responsible official and the requester advised of the date the appeal was received and the expected date of response. The determination to affirm the initial denial (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
(i) The requester shall be notified in writing of the denial;
(ii) The reasons for the denial, including the FOIA exemptions relied upon;
(iii) The name and title or position of the official responsible for the denial on appeal;
(iv) 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).
(3) If a determination cannot be made within the 20-day period (or any extension pursuant to paragraph (i)(1) of this section) the requester shall be promptly notified in writing that the determination will be made as soon as practicable but that the requester is nonetheless entitled to commence an action in a district court as provided in paragraph (k) of this section. However, the requester may also be invited, in the alternative, 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.
(i)
(i) The need to search for and collect the requested records from field facilities or other establishments in buildings other than the building in which the office of the official to whom the request is made is located;
(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 more components within the Department of Treasury or within a component (other than the legal staff or the component concerned with public affairs) having substantial subject-matter interest. Consultations with personnel of the Department of Justice concerned with requests for records under 5 U.S.C. 552 do not constitute a basis for an extension under this subdivision.
(2)
(j)
(k)
(l)
(m)
(a)
(b)
(c)
(i) The information is less than ten years old;
(ii) The information is subject to prior express commitment of confidentiality given by the component to the business submitter, or
(iii) The component has reason to believe that disclosure of the information may result in commercial or financial injury to the business submitter.
(2) For business information submitted to the Department on or after July 14, 1987, the component shall provide a business submitter with notice of receipt of a request whenever:
(i) The business submitter has in good faith designated the information as commercially or financially sensitive information, or
(ii) The component has reason to believe that disclosure of the information may result in commercial or financial injury to the business submitter.
(3) Notice of a request for business information falling within paragraph (c)(1) of this section shall be required for a period of not more than ten years after the date of submission unless the
(4) Whenever possible, the submitter's claim of confidentiality should be supported by a statement or certification by an officer or authorized representative of the company that the information in question is in fact confidential commercial or financial information and has not been disclosed to the public.
(d)
(e)
(1) 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 ten working days after the notice of the final decision to release the requested information has been mailed to the submitter. A copy of the disclosure notice shall be forwarded to the requester at the same time.
(f)
(g)
(1) The component determines that the information shall not be disclosed;
(2) The information lawfully has been published or otherwise made available to the public.
(3) Disclosure of the information is required by law (other than 5 U.S.C. 552); or
(4) The information was acquired in the course of a lawful investigation of a possible violation of criminal law.
(a)
(i)
(ii)
(iii)
(iv)
(2)
(i)
(ii)
(iii)
(3)
(4)
(b)
(2) Fees shall be charged in accordance with the schedule contained in paragraph (g) of this section for serivces 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 paragraphs (c) or (d) of this section.
(c)
(d)
(2) Normally no charge shall be made for providing records to Federal, state or foreign governments, international governmental organizations, or local governmental agencies or offices.
(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 such official within 35 days of the denial of the initial request for waiver or reduction and shall be decided promptly.
(4) Appeals from an adverse determination of the requester's category as described in § 1.5(c)(1) and provided in § 1.5(h)(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 component's own records. Appeals shall be addressed in writing to such official within 35 days of the component's determination of the requester's category and shall be decided promptly.
(e)
(1) When the fees for processing the request are estimated by the component of the Department of the Treasury to exceed the limit set by the requester, and that amount is less than $250, the requester shall be notified of the estimated costs. In addition, the requester shall also be given an opportunity to reformulate the request in an attempt to reduce fees and still provide the requester with the documents sought.
(2) When the requester has failed to state a limit and the costs are estimated to exceed $250.00 and the relevant component has not then determined to waive or reduce the fees, a notice shall be sent to the requester. This notice shall:
(i) Inform the requester of the estimated costs;
(ii) Extend an offer to the requester to confer with personnel of the relevant component of the Department of the Treasury in an attempt to reformulate the request in a manner which will reduce the fees and still meet the needs of the requester.
(3) When the Department or a component of the Department acts under paragraph (e)(1) or (2) of this section, the administrative time limits of 10 working days from receipt of initial requests and 20 working days from receipt of appeals from initial denial plus extensions of these time limits will begin only after fees have been paid or a request reformulated.
(f)
(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 notify the requester of the likely cost and obtain satisfactory assurance of full payment where the requester has a history of prompt payment of FOIA fees or require a requester to make an advance payment of the entire fee before continuing to process the request in the case of requesters with no history of payment.
(4) If a requester has previously failed to pay a fee in a timely fashion (
(g)
(1)
(i) $.15 per copy of each page, up to 8
(ii) Photographs, films, and other materials—actual cost of reproduction.
(iii) Other types of duplication services not mentioned above—actual cost.
(iv) Records may be released to a private contractor for copying and the requester will be charged the actual cost of duplication charged by the private contractor.
(2)
(i)
(ii)
(3)
(4)
(5)
(i) Certifying that records are true copies;
(ii) Sending records by special methods such as express mail, etc.
1.
2.
Library, Room 5030, Main Treasury Building, 1500 Pennsylvania Avenue NW., Washington, DC 20220.
3.
Requests may be delivered in person to the Main Treasury Building, Room 5030, 1500 Pennsylvania Avenue NW., Washington, DC.
4.
Appeals may be delivered personally to the Main Treasury Building, Room 5030, 1500 Pennsylvania Avenue NW., Washington, DC.
5.
1.
2.
3.
4.
Appeals may be delivered personally to the
5.
1.
2.
3.
(b)
(c) All such requests should be conspicuously labeled on the face of the envelope, “Freedom of Information Act Request” or “FOIA Request”.
4.
5.
1.
2.
3.
4. Administrative appeal of initial determinations under 31 CFR 1.5(h) 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, United States Secret Service, Room 941, 1800 G Street, NW., Washington, DC 20223.
5.
1.
2.
3.
4.
Appeals may be mailed or delivered in person to: Freedom of Information Appeal, Director, Bureau of Alcohol, Tobacco, and Firearms, 1200 Pennsylvania Avenue, NW., Washington, DC 20226.
5.
1.
2.
3.
4. Administrative appeal of initial determination under 31 CFR 1.5(h) 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 118-M, Washington, DC 20228.
5.
1.
2.
3.
4.
5.
1.
2.
3.
4.
5.
1.
2.
3.
4.
5.
1.
2.
3.
4.
5.
1.
2.
3.
(b) Initial determinations under 31 CFR 1.5(g) whether to grant requests for other records of the United States Savings Bond Division, such as personnel records or records relating to the internal management of the Division, will be made by the Director of Public Affairs, United States Savings Bond Division. Requests made by mail should be addressed to: Freedom of Information Act Request, Director of Public Affairs, U.S. Savings Bond Division, Department of the Treasury, Washington, DC 20226.
4.
(b) Appellate determinations under 31 CFR 1.5(h) with respect to records, access to which has been denied by the Director of Public Affairs, United States Savings Bond Division, will be made by the National Director, United States Savings Bond Division. Requests made by mail should be addressed to: Freedom of Information Appeal, National Director, Department of the Treasury, Washington, DC 20226.
5.
1.
2.
3.
4.
5.
1.
2.
3.
Requests may be delivered in person to: Office of Thrift Supervision, Information, Services Division, 1700 G Street, NW., Washington, DC.
4.
Appeals may be delivered in person to: Office of Thrift Supervision, Information Services Division, 1700 G Street, NW., Washington, DC.
5.
The regulations in this subpart concern access to information and records other than under 5 U.S.C. 552. This subpart is applicable only to the Departmental Offices as defined in § 1.1(a) of this part and the United States Savings Bonds Division and the United States Secret Service.
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, 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.
(a) Officers and employees of the Department may, in response to requests,
(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;
(a) Treasury Department officers and employees are prohibited from testifying or otherwise furnishing information obtained as a result of their official capacities or in connection with the transaction of public business, in compliance with a subpoena or other order or demand of any court or other authority without the prior approval of an officer authorized to determine the availability of records under these regulations.
(b) Treasury Department officers and employees are prohibited from furnishing any record in compliance with subpoenas duces tecum or other order or demand of any court or other authority, without the prior approval of an officer authorized to determine the availability of records under the regulations in this part.
(c) In court cases in which the United States or the Treasury Department is not a party, where the giving of testimony is desired, an affidavit by the litigant or the litigant's attorney, setting forth the information with respect to which the testimony of such officer or employee is desired, must be submitted before permission to testify will be granted. Permission to testify will, in all cases, be limited to the information set forth in the affidavit or to such portions thereof as may be deemed proper.
(d) Where approval to testify or to furnish records in compliance with a subpoena, order or demand is not given the person to whom it is directed shall, if possible, appear in court or before the other authority and respectfully state his inability to comply in full with the subpoena, order or demand, relying for his action upon this section.
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 the supervisory official designated in § 1.8.
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
(a) The Departmental Offices, which includes the offices of:
(1) The Secretary of the Treasury, including immediate staff;
(2) The Deputy Secretary of the Treasury, including immediate staff;
(3) The Under Secretary of the Treasury for Finance, including immediate staff;
(4) The Fiscal Assistant Secretary, including immediate staff;
(5) The Assistant Secretary of the Treasury for Economic Policy and all other offices reporting to such official, including immediate staff;
(6) The General Counsel and also the Legal Division, except legal counsel to the components listed in paragraphs (a)(9) and (b) through (l) of this section;
(7) The Assistant Secretary of the Treasury for International Affairs and all offices reporting to such official, including immediate staff;
(8) The Treasurer of the United States, including immediate staff;
(9) The Assistant Secretary of the Treasury for Tax Policy, including immediate staff and all offices reporting to such official;
(10) The Assistant Secretary of the Treasury for Management, and all offices reporting to such official, including immediate staff;
(11) The Assistant Secretary of the Treasury for Domestic Finance and all offices reporting to such official, including immediate staff;
(12) The Assistant Secretary of the Treasury for Legislative Affairs, including immediate staff;
(13) The Assistant Secretary of the Treasury for Public Affairs and Public Liaison, including immediate staff;
(14) The Assistant Secretary of the Treasury for Enforcement and all offices reporting to such official, including immediate staff;
(15) The Special Assistant to the Secretary (National Security), including immediate staff;
(16) The Inspector General and all offices reporting to such official, including immediate office.
(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 Savings Bond Division;
(l) The United States Secret Service;
(m) The Office of Thrift Supervision.
(a) The term
(b) The term
(c) The term
(d) The term
(e) The term
(f) The term
(g) The term
(h) The term
(i) The term
(j) The term
(k) The term
(a)
(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)
(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)
(d)
(1) Subject to 5 U.S.C. 552a(j) and § 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 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)
(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)
(g)
(a)
(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
(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)
(c)
(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)
(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
(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 U.S.C. 552a and this part. (See 5 U.S.C. 552a (j) and (k))
(d)
(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
(a)
(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 § 1.21(g) and as described under 5 U.S.C. 552a(e)(4)(D) and § 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 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))
(a)
(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 § 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 § 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)
(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)
(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)
(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 § 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 § 1.23(c). (See 5 U.S.C. 552a(c))
(a)
(b)
(c)
(d)
(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 § 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 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)
(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)
(g)
(2)
(3)
(4)
(5)
(6)
(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:
(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)).
(a)
(b)
(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
(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
(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)
(d)
(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)
(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)
(4)
(5)
(f)
(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
(6) Records compiled in reasonable anticipation of a civil action or proceeding.
(a)
(b)
(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
(2) Employees of the Department of the Treasury involved in the design, 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
(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)
(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 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).)
(a)
(b)
(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
(2)
(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
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.
(a)
(b)
(a)
(b)
(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)
(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.)
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))
(a)
(b)
(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)
In accordance with 5 U.S.C. 552a (j) and (k) and § 1.23(c), constituent units of the Department of the Treasury exempt the following systems of records from certain provisions of the Privacy Act for the reasons indicated:
(a)
(b)
(c)
(d)
(e)
(a)
(b)
(c)
(2) To the extent that the exemption under 5 U.S.C. 552a(j)(2) does not apply to the above named system of records, then the exemption under 5 U.S.C. 552a(k)(2) relating to investigatory material compiled for law enforcement purposes is claimed for this system.
(3) The provisions of the Privacy Act of 1974 from which exemptions are claimed under 5 U.S.C. 552a(j)(2) are as follows:
(d)
(2) To the extent that information contained in the above named system has as its principal purpose the enforcement of criminal laws, the exemption for such information under 5 U.S.C. 552a(j)(2) is claimed.
(3) Provisions of the Privacy Act of 1974 from which exemptions are claimed under 5 U.S.C. 552a(k)(2) are as follows:
(e)
(2) 5 U.S.C. 552a(c)(4), (d)(1), (2), (3), and (4), (e)(4)(G) and (H), (f) and (g) relate to an individual's right to be notified of the existence of records pertaining to such individual; requirements for identifying an individual who requests access to records; the agency procedures relating to access to records and the contest of information contained in such records; and the civil remedies available to the individual in the event of adverse determinations by an agency concerning access to or amendment of information contained in record systems. This system is exempt from the foregoing provisions for the following reasons: To notify an individual at the individual's request of the existence of records in an investigative file pertaining to such individual or to grant access to an investigative file could interfere with investigative and enforcement proceedings; co-defendants of a right to a fair trial; constitute an unwarranted invasion of the personal privacy of others, disclose the identity of confidential sources and reveal confidential information supplied by these sources; and disclose investigative techniques and procedures.
(3) 5 U.S.C. 552a(e)(4)(I) requires the publication of the categories of sources of records in each system of records. The application of this provision could disclose investigative techniques and procedures and cause sources to refrain from giving such information because of fear of reprisal, or fear of breach of promises of anonymity and confidentiality. This would compromise the ability to conduct investigations, and to identify, detect, and apprehend violators.
(4) 5 U.S.C. 552a(e)(1) requires each agency to maintain in its records only such information about an individual that is relevant and necessary to accomplish a purpose of the agency required by statute or Executive Order. An exemption from the foregoing is needed:
(A) Because it is not possible to detect relevance or necessity of specific information in the early stages of a criminal or other investigation.
(B) Relevance and necessity are questions of judgment and timing. What appears relevant and necessary when collected may ultimately be determined to be unnecessary. It is only after the information is evaluated that the relevance and necessity of such information can be established.
(C) In any investigation the Inspector General may obtain information concerning the violations of laws other than those within the scope of his jurisdiction. In the interest of effective law enforcement, the Inspector General should retain this information as it may aid in establishing patterns of criminal activity, and provide leads for those law enforcement agencies charged with enforcing other segments of criminal or civil law.
(D) In interviewing persons, or obtaining other forms of evidence during an investigation, information may be supplied to the investigator which relate to matters incidental to the main purpose of the investigation but which may relate to matters under the investigative jurisdiction of another agency. Such information cannot readily be segregated.
(5) 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 privilege under Federal programs. The application of the provision would impair investigations of illegal acts, violations of the rules of conduct, merit system and any other misconduct for the following reasons:
(A) In certain instances the subject of an investigation cannot be required to supply information to investigators.
(B) Most information collected about an individual under investigation is obtained from third parties such as witnesses and informers. It is not feasible to rely upon the subject of the investigation as a source for information regarding his activities.
(C) The subject of an investigation will be alerted to the existence of an investigation if an attempt is made to obtain information from the subject. This would afford the individual the opportunity to conceal any criminal activities to avoid apprehension.
(D) In any investigation it is necessary to obtain evidence from a variety of sources other than the subject of the investigation in order to verify the evidence necessary for successful litigation.
(6) 5 U.S.C. 552a(e)(3) requires that an agency must inform the subject of an investigation who is asked to supply information of:
(A) The authority under which the information is sought and whether disclosure of the information is mandatory or voluntary.
(B) The purposes for which the information is intended to be used,
(C) The routine uses which may be made of the information, and
(D) The effects on the subject, if any of not providing the requested information. The reasons for exempting this system of records from the foregoing provision are as follows:
(i) The disclosure to the subject of the investigation as stated in (B) above would provide the subject with substantial information relating to the nature of the investigation and could impede or compromise the investigation.
(ii) If the subject were informed of the information required by this provision, it could seriously interfere with undercover activities by requiring disclosure of undercover agents identity and impairing their safety, as well as impairing the successful conclusion of the investigation.
(iii) Individuals may be contacted during preliminary information gathering in investigations authorized by Treasury Department Order No. 256 before any individual is identified as the subject of an investigation. Informing the individual of the matters required by this provision would hinder or adversely affect any present or subsequent investigations.
(7) 5 U.S.C. 552a(e)(5) requires that records be maintained with such accuracy, relevance, timeliness, and completeness as is reasonably necessary to assure fairness to the individual in making any determination about an individual. Since the law defines “maintain” to include the collection of information, complying with this provision would prevent the collection of any data not shown to be accurate, relevant, timely, and complete at the moment of its collection. In gathering information during the course of an investigation it is not possible to determine this prior to collection of the information. Facts are first gathered and then placed into a logical order which objectively proves or disproves criminal behavior on the part of the suspect. Material which may seem unrelated, irrelevant, incomplete, untimely, etc., may take on added meaning as an investigation progresses. The restrictions in this provision could interfere with the preparation of a complete investigative report.
(8) 5 U.S.C. 552a(e)(8) requires an agency to make reasonable efforts to serve notice on an individual when any record on such individual is made available to any person under compulsory legal process when such process becomes a matter of public record. The notice requirement of this provision could prematurely reveal an ongoing criminal investigation to the subject of the investigation.
(f)
The Assistant Secretary for Administration exempts under section (k) of the Privacy Act of 1974, 5 U.S.C. 552a,
The sections of the Act from which this system of records are exempt are in general those providing for individual access to records. When such access would cause the identity of a confidential source to be revealed, it would impair the future ability of the Treasury 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 are exempt from section (e)(1) which requires that the agency maintain in its records only such information about an individual as is relevant and necessary to accomplish a statutory or executively ordered purpose. The Director finds that to fulfill the requirements of section (e)(1) would unduly restrict the agency in its information gathering inasmuch as it is often not until well after the investigation that it is possible to determine the relevance and necessity of particular information.
If any investigations within the scope of section (k)(5) become involved with civil or criminal matters, exemptions from the Act could also be asserted under sections (k)(2) or (j)(2).
The new regulations promulgated by the Office of Foreign Assets Control (as amendments to its Foreign Assets Control Regulations; Transaction Control Regulations; Cuban Assets Control Regulations; and, Rhodesian Sanction Regulations) read as follows:
Pursuant to subsection (k)(2) of 5 U.S.C. 552a, the Privacy Act of 1974, the Enforcement Records of the Office of Foreign Assets Control are hereby exempted from the requirements of subsections (c)(3), (d), (e)(1), (e)(4)(G-I), and (f) of 5 U.S.C. 552a, as materials which are compiled and maintained for the purpose of conducting and recording investigations of criminal violations of relevant statutes and regulations administered by the Office of Foreign Assets Control. These records contain, among other things, information and evidence which was furnished in confidence by individuals, corporations, partnerships and other entities, Federal, State and local agencies, and by foreign individuals, corporations, partnerships and other entities, and foreign government sources. If it should appear that the individual concerning whom a record is maintained has been or will be denied any right, privilege, or benefit to which he would otherwise be entitled by Federal law, or for which he would otherwise be eligible, except for the maintenance of such material, such material shall be disclosed to such individual, except: (1) To the extent that disclosure 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 (2) to the extent that disclosure would reveal the identity of a source who furnished information prior to the effective date of the Privacy Act (September 27, 1975) under an implied promise that the identity of the source would be held in confidence.
(a)
(b)
(c)
(d)
(e)
(f)
(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 FinCEN Data Base would compromise FinCEN's ability to provide useful tactical and strategic information to law enforcement agencies.
(i) Permitting access to records contained in the FinCEN Data Base 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
(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 FinCEN's ability to carry out its mandate.
(iv) Furthermore, providing access to records contained in the FinCEN Data Base 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 FinCEN Data Base for the reasons outlined in paragraphs (f)(2) through (iv) of this paragraph, permitting access in keeping with these provisions would discourage other law enforcement and regulatory agencies, foreign and domestic, from freely sharing information with FinCEN and thus would restrict FinCEN's access to information necessary to accomplish its mission most effectively.
(vi) Finally, the dissemination of certain information that FinCEN may maintain in the FinCEN Data Base 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 propose to exempt the FinCEN Data Base from the provisions of 5 U.S.C. 552a relating to access to records, for the reasons set out in paragraph (f)(2) of this section, these provisions should not apply to the FinCEN Data Base.
(4) 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 proposed to exempt the FinCEN Data Base from the provisions of 5 U.S.C. 552a relating to access to and amendment of records, for the reeasons set out in paragraph (f)(3) of this section, this provision ought not apply to the FinCEN Data Base.
(5) 5 U.S.C. 552a(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 FinCEN. Making accountings of disclosures available to the subjects of an investigation would alter 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
(ii) Moreover, providing accountings to the subjects of investigations would alert them to the fact that FinCEN 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 FinCEN's information-gathering and analysis systems and permit violators to take steps to avoid detection or apprehension.
(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 FinCEN Data Base could compromise FinCEN'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 FinCEN Data Base could impair FinCEN's ability to collect and disseminate valuable law enforcement information.
(i) At the time that FinCEN collects information, it often lacks sufficient time to determine whether the information is relevant and necessary to accomplish a FinCEN 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 irrelevent 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 FinCEN analysts fall within the investigative jurisdiction of the Department of the Treasury. To promote effective law enforcement, FinCEN 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, FinCEN 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 FinCEN'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 FinCEN Data Base would impair FinCEN'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 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
(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 FinCEN Data Base should be exempted from this provision to avoid impairing FinCEN'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) 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 FinCEN Data Base 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 FinCEN'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, it is often impossible to determine accuracy, relevance, timeliness, or completeness prior to dissemination, because FinCEN 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.
(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 FinCEN Data Base should be exempted from this provision to avoid revealing investigative techniques and procedures outlined in those records and to prevent revelation of
(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 FinCEN Data Base 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 propose to exempt the FinCEN Data Base, since there should be no civil remedies for failure to comply with provisions from which FinCEN is exempted. Exemption from this provision will also protect FinCEN from baseless civil court actions that might hamper its ability to collate, analyze, and disseminate investigative, intelligence, and law enforcement data.
(g)
(h)
(i)
(j)
(k)
(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 violators of law;
(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), (f)(3) and (f)(5) grant individuals access to records containing information about them. The application of these provisions to the SAR System would compromise the ability of the component agencies of the SAR System to use the information effectively for purposes of law enforcement.
(i) Permitting access to records contained in the SAR System would provide individuals with information concerning the nature of any current investigations and would enable them to avoid detection or apprehension, because they could;
(A) Discover the facts that would form the basis of an arrest;
(B) Destroy or alter evidence of criminal conduct that would form the basis of their arrest, and
(C) Delay or change the commission of a crime that was about to be discovered by investigators.
(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.
(3) 5 U.S.C. 552a(d)(2), (d)(3) and (d)(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 note the disputed portion of the record and, if the agency refuses to amend the record, to provide a copy of the individual's statement of disagreement with the agency's refusal, to persons or other agencies to whom the record is thereafter disclosed. Because these provisions depend on the individual's having access to his or her records, and since these rules exempt the SAR System from the provisions of 5 U.S.C. 552a relating to access to records, for the reasons set out in paragraph (k)(2), these provisions do not apply to the SAR System.
(4) 5 U.S.C. 552a(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. Because this provision depends on an individual's having access to and an opportunity to request amendment of records pertaining to him or her, and because these rules exempt the SAR System from the provisions of 5 U.S.C. 552a relating to access to and amendment of records, for the reasons set forth in paragraphs (k)(2) and (3), this provision does not apply to the SAR System.
(5) 5 U.S.C. 552a(c)(3) requires an agency to make the accounting of any disclosures of records required by 5 U.S.C. 552a(c)(1) available to the individual named in the record upon his or her request. The accounting 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 effective use of information collected in the SAR System. Making an accounting 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.
(ii) Moreover, providing an accounting to the subjects of investigations would alert them to the fact that FinCEN has information regarding possible criminal activities and could inform them of the general nature of that information. Access to such information could reveal the operation of the information-gathering and analysis systems of FinCEN, the Federal Supervisory Agencies and other SAR System Users and permit violators to take steps to avoid detection or apprehension.
(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 SAR System could compromise FinCEN's and the Federal Supervisory Agencies’ ability to provide useful information to law enforcement agencies, because 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
(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 SAR System would impair FinCEN's ability to collect, analyze and disseminate to System Users investigative or enforcement information. The SAR System is designed to house information about known or suspected criminal activities or suspicious transactions that has been collected and reported by financial institutions, or their examiners or other enforcement or supervisory officials. It is not feasible to rely upon the subject of an investigation to supply information. An attempt to obtain information from the subject of any investigation would alert that individual to the existence of an investigation, providing an opportunity to conceal criminal activity and avoid apprehension. Further, with respect to the initial SAR, 31 U.S.C. § 5318(g)(2) specifically prohibits financial institutions making such reports from notifying any participant in the transaction that a report has been made.
(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, 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 application of these provisions to the SAR System would compromise the ability of the component agencies of the SAR System to use the information effectively for purposes of law enforcement.
(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. Application of this provision to the SAR System would hinder the collection and dissemination of information. Because Suspicious Activity Reports are filed by financial institutions with respect to known or suspected violations of law or suspicious activities, it is not possible at the time of collection for the agencies that use the SAR System to determine that the information in such records is accurate, relevant, 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. Application of these requirements to the SAR System would prematurely reveal the existence of an ongoing investigation to the subject of investigation where there is need to keep the existence of the investigation secret. It would render ineffective 31 U.S.C. § 5318(g)(2), which prohibits financial institutions and their officers, employees and agents from disclosing to any person involved in a transaction that a SAR has been filed.
(12) 5 U.S.C. 552a(g) provides an individual with civil remedies 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 any determination relating to an individual is based on records that are not accurate, relevant, timely and complete, and when an agency fails
(l)
The Commissioner of Internal Revenue finds that the orderly and efficient administration of the internal revenue laws necessitates that certain systems of records maintained by the Internal Revenue Service be exempted from certain sections of the Privacy Act of 1974 (88 Stat. 1986).
(a)
(2) 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 Internal Revenue Service have as their principal function activities pertaining to the enforcement of criminal laws.
(3) To the extent the exemption under 5 U.S.C. 552a(j)(2) does not apply to any of the above-named systems, then exemptions under 5 U.S.C. 552a(k)(2), relating to investigatory material compiled for law enforcement purposes, are hereby claimed for such systems.
(4) The provisions of the Privacy Act of 1974 from which exemptions are claimed under 5 U.S.C. 552a(j)(2) are as follows:
(5) See paragraph (c) for reasons for the exemptions.
(b)
(2) 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. To the extent that information contained in the above-named systems has as its principal purpose the enforcement of criminal laws, exemption for such information under 5 U.S.C. 552a (j)(2) is hereby claimed.
(3) The provisions of the Privacy Act of 1974 from which exemptions are claimed under 5 U.S.C. 552a(k)(2) are as follows:
(4) See paragraph (c) for reasons for the exemptions.
(c)
(1) 5 U.S.C. 552a(c)(3). This provision of the Privacy Act provides for the release of the disclosure accounting required by 5 U.S.C. 552a(c) (1) and (2) to the individual named in the record at his request. The reasons for exempting systems of records from the foregoing provision are as follows:
(i) The release of disclosure accounting would put the subject of an investigation on notice of the existence of an investigation and that such person is the subject of that investigation;
(ii) Such release would provide the subject of an investigation with an accurate accounting of the date, nature, and purpose of each disclosure and the name and address of the person or agency to whom the disclosure is made. The release of such information to the subject of an investigation would provide the subject with significant information concerning the nature of the investigation and could result in the altering or destruction of documentary evidence, the improper influencing of witnesses, and other activities that could impede or compromise the investigation. In the case of a delinquent account, such release might enable the subject of the investigation to dissipate assets before levy;
(iii) Release to the individual of the disclosure accounting would alert the individual as to which agencies were investigating this person and the scope of the investigation, and could aid the individual in impeding or compromising investigations by those agencies.
(2) 5 U.S.C. 552a (c)(4), (d)(1), (2), (3), and (4), (e)(4) (G) and (H), (f), and (g). These provisions of the Privacy Act relate to an individual's right to notification of the existence of records pertaining to such individual; requirements for identifying an individual who requests access to records; the agency procedures relating to access to records and the contest of the information contained in such records; and the civil remedies available to the individual in the event of adverse determinations by an agency concerning access to or amendment of information contained in record systems. The reasons for exempting systems of records from the foregoing provisions are as follows: To notify an individual at the individual's request of the existence of records in
(3) 5 U.S.C. 552a(e)(4)(I). This provision of the Privacy Act requires the publication of the categories of sources of records in each system of records. In cases where an exemption from this provision has been claimed, the reasons are as follows:
(i) Revealing categories of sources of information could disclose investigative techniques and procedures;
(ii) Revealing categories of sources of information could cause sources who supply information to investigators to refrain from giving such information because of fear of reprisal, or fear of breach of promises of anonymity and confidentiality.
(4) 5 U.S.C. 552a(e)(1). This provision of the Privacy Act requires each 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 reasons for exempting systems of records from the foregoing provision are as follows:
(i) The Internal Revenue Service will limit its inquiries to information which is necessary for the enforcement and administration of tax laws. However, an exemption from the foregoing provision is needed because, particularly in the early stages of a tax audit or other investigation, it is not possible to determine the relevance or necessity of specific information.
(ii) Relevance and necessity are questions of judgment and timing. What appears relevant and necessary when collected may subsequently be determined to be irrelevant or unnecessary. It is only after the information is evaluated that the relevance and necessity of such information can be established with certainty.
(iii) When information is received by the Internal Revenue Service relating to violations of law within the jurisdiction of other agencies, the Service processes this information through Service systems in order to forward the material to the appropriate agencies.
(5) 5 U.S.C. 552a(e)(2). This provision of the Privacy Act 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 reasons for exempting systems of records from the foregoing provisions are as follows:
(i) In certain instances the subject of a criminal investigation cannot be required to supply information to investigators. In those instances, information relating to a subject's criminal activities must be obtained from other sources;
(ii) In a criminal investigation it is necessary to obtain evidence from a variety of sources other than the subject of the investigation in order to accumulate and verify the evidence necessary for the successful prosecution of persons suspected of violating the criminal laws.
(6) 5 U.S.C. 552a(e)(3). This provision of the Privacy Act requires that an agency must inform the subject of an investigation who is asked to supply information of (A) the authority under which the information is sought and whether disclosure of the information is mandatory or voluntary, (B) the purposes for which the information is intended to be used, (C) the routine uses which may be made of the information, and (D) the effects on the subject, if any, of not providing the requested information. The reasons for exempting systems of records from the foregoing provision are as follows:
(i) The disclosure to the subject of an investigation of the purposes for which the requested information is intended to be used would provide the subject with significant information concerning the nature of the investigation and could result in impeding or compromising the investigation.
(ii) Informing the subject of an investigation of the matters required by this
(iii) 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.
(7) 5 U.S.C. 552a(e)(5). This provision of the Privacy Act requires an agency to maintain all records which are used in making any determination about an individual with such accuracy, relevance, timeliness, and completeness as is reasonably necessary to assure fairness to the individual in the determination. The reasons for exempting systems of records from the foregoing provision are as follows: Since the law defines “maintain” to include the collection of information, compliance with the foregoing provision would prohibit the initial collection of any data not shown to be accurate, relevant, timely, and complete at the moment of its collection. In gathering information during the course of a criminal investigation, it is not feasible or possible to determine completeness, accuracy, timeliness, or relevancy prior to collection of the information. Facts are first gathered and then placed into a cohesive order which objectively proves or disproves criminal behavior on the part of a suspect. Seemingly nonrelevant, untimely, or incomplete information when gathered may acquire new significance as an investigation progresses. The restrictions of the foregoing provision could impede investigators in the preparation of a complete investigative report.
(8) 5 U.S.C. 552a(e)(8). This provision of the Privacy Act requires an agency to make reasonable efforts to serve notice on an individual when any record on such individual is made available to any person under compulsory legal process when such process becomes a matter of public record. The reasons for exempting systems of records from the foregoing provision are as follows: The notice requirement of the foregoing provision could prematurely reveal the existence of criminal investigations to individuals who are the subject of such investigations.
(d)
(2) 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.
(3) The above-named system 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”.
(4) The reason for exempting the above-named 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.
(5) The provisions of the Privacy Act of 1974 from which exemption is claimed under 5 U.S.C. 552a(k)(4) are as follows:
(e)
(2) 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 records in the above-named systems 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.
(3) The provisions of the Act from which exemptions are claimed for the above-named systems of records are in general those providing for individual access to records. When such access would cause the identity of a confidential source to be revealed, it would impair the future ability of the Service 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 are to be exempt from 5 U.S.C. 552a(e)(1), which requires that the agency maintain in its records only such information about an individual as is relevant and necessary to accomplish a statutory or executively ordered purpose. The Service finds 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 well after the investigation that it is possible to determine the relevance and necessity of particular information.
(4) 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.
(5) The provisions of the Privacy Act of 1974 from which exemptions are claimed under 5 U.S.C. 552a(k)(5) are as follows:
(f)
(2) 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.
(3) The reason for exempting the above-named system is that disclosure of the material in the system would compromise the objectivity or fairness of the examination process.
(4) The provisions of the Privacy Act of 1974 from which exemptions are claimed under 5 U.S.C. 552a(k)(6) are as follows:
(g)
In accordance with 5 U.S.C. 552a (j) and (k), general notice is hereby given of rulemaking pursuant to the Privacy Act of 1974 by the Commissioner, United States Customs Service, under authority delegated to him by the Secretary of the Treasury. The Commissioner, United States Customs Service, exempts the systems of records identified in the paragraphs below from certain provisions of the Privacy Act of 1974 as set forth in such paragraphs.
a.
1.
2.
(b) 5 U.S.C. 552a (d)(1), (e)(4)(H) and (f) (2), (3) and (5) enable individuals to gain access to records pertaining to them. The Customs Service believes that application of these provisions to the above-listed systems of records would compromise its ability to complete or continue criminal investigations and to detect and apprehend violators of the Customs and related criminal laws. Permitting access to records contained in the above-listed systems of records would provide individuals with significant information concerning the nature of the investigation, and this could enable them to avoid detection or apprehension in the following ways: (1) By discovering the collection of facts which would form the basis for their arrest, (2) by enabling them to destroy contraband or other evidence of criminal conduct which would form the basis for their arrest and, (3) by learning that the criminal investigators had reason to believe that a crime was about to be committed, they could delay the commission of the crime or change the scene of the crime to a location which might not be under surveillance. Granting access to on-going or closed investigative files would also reveal investigative techniques and procedures, the knowledge of which could enable individuals planning criminal activity to structure their future operations in
(c) 5 U.S.C. 552a(d) (2), (3) and (4), (e)(4)(H) and (f)(4), which are dependent upon access having been granted to records pursuant to the provisions cited in paragraph (b) above, enable individuals to contest (seek amendment to) the content of records contained in a system of records and require an agency to note an amended record and to provide a copy of an individual's statement (of disagreement with the agency's refusal to amend a record) to persons or other agencies to whom the record has been disclosed. The Customs Service believes that the reasons set forth in paragraph (b) above are equally applicable to this subparagraph and, accordingly, those reasons are hereby incorporated herein by reference.
(d) 5 U.S.C. 552a(c)(3) requires that an agency make accountings of disclosures of records available to individuals named in the records at their request; such accountings must state the date, nature and purpose of each disclosure of a record and the name and address of the recipient. The Customs Service believes that application of this provision to the above-listed systems of records would impair the ability of other law enforcement agencies to make effective use of information provided by the Customs Service in connection with the investigation, detection and apprehension of violators of the criminal laws enforced by those other law enforcement agencies. Making accountings of disclosure available to violators would alert those individuals to the fact that another agency is conducting an investigation into their criminal activities, and this 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 thereby be able to take appropriate 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 which would form the basis for their arrest. In addition, providing violators with accountings of disclosure would alert those individuals to the fact that the Customs Service has information regarding their criminal activities and could inform those individuals of the general nature of that information; this, in turn, would afford those individuals a better opportunity to take appropriate steps to avoid detection or apprehension for violations of the Customs and related criminal laws.
(e) 5 U.S.C. 552a(c)(4) requires that an agency inform any person or other agency about any correction or notation of dispute made by the agency in accordance with 5 U.S.C. 552a(d) of any record that has been disclosed to the person or agency if an accounting of the disclosure was made. Since this provision is dependent on an individual's having been provided an opportunity to contest (seek amendment to) records pertaining to him, and since the above-listed systems of records are proposed to be exempted from those
(f) 5 U.S.C. 552a(e)(4)(I) requires that an agency publish a public notice listing the categories of sources for information contained in a system of records. The Customs Service believes that application of this provision to the above-listed systems of records could compromise its ability to conduct investigations and to identify, detect and apprehend violators of the Customs and related criminal laws for the reasons that revealing sources for information could 1) disclose investigative techniques and procedures, 2) result in threatened or actual reprisal directed to informers by the subject under investigation, and 3) result in the refusal of informers to give information or to be candid with criminal investigators because of the knowledge that their identities as sources might be disclosed.
(g) 5 U.S.C. 552a(e)(1) 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 term “maintain” as defined in 5 U.S.C. 552a(a)(3) includes “collect” and “disseminate.” At the time that information is collected by the Customs Service, there is often insufficient time to determine whether the information is relevant and necessary to accomplish a purpose of the Customs Service; in many cases information collected may not be immediately susceptible to a determination of whether the information is relevant and necessary, particularly in the early stages of investigation, and in many cases information which initially appears to be irrelevant and unnecessary may, upon further evaluation or upon continuation of the investigation, prove to have particular relevance to an enforcement program of the Customs Service. Further, not all violations of law discovered during a Customs Service criminal investigation fall within the investigative jurisdiction of the Customs Service; in order to promote effective law enforcement, it often becomes necessary and desirable to disseminate information pertaining to such violations to other law enforcement agencies which have jurisdiction over the offense to which the information relates. The Customs Service should not be placed in a position of having to ignore information relating to violations of law not within its jurisdiction where that information comes to the attention of the Customs Service through the conduct of a lawful Customs Service investigation. The Customs Service therefore believes that it is appropriate to exempt the above-listed systems of records from the provisions of 5 U.S.C. 552a(e)(1).
(h) 5 U.S.C. 552a(e)(2) requires that an agency 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 Customs Service believes that application of this provision to the above-listed systems of records would impair the ability of the Customs Service to conduct investigations and to identify, detect and apprehend violators of the Customs and related criminal laws for the following reasons: (1) most information collected about an individual under criminal investigation is obtained from third parties such as witnesses and informers, and it is usually not feasible to rely upon the subject of the investigation as a source for information regarding his criminal activities, (2) 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, (3) in certain instances the subject of a criminal investigation is not required to supply information to criminal investigators as a matter of legal duty, and (4) during criminal investigations it is often a matter of sound investigative procedure to obtain information from a variety of sources in order to verify information already obtained.
(i) 5 U.S.C. 552a(e)(3) requires that an agency inform each individual whom it
(j) 5 U.S.C. 552a(e)(5) requires that an agency maintain all records used by the agency 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. Since 5 U.S.C. 552a(a)(3) defines “maintain” to include “collect” and “disseminate,” application of this provision to the above-listed systems of records would hinder the initial collection of any information which 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 necessary flow of information from the Customs Service to other law enforcement agencies where a Customs Service investigation revealed information pertaining to a violation of law which was under the investigative jurisdiction of another agency. In collecting information during the course of a criminal investigation, it is not possible or feasible to determine accuracy, relevance, timeliness or completeness prior to collection of the information; in disseminating information to other law enforcement agencies it is often not possible to determine accuracy, relevance, timeliness or completeness prior to dissemination because the disseminating agency may not have the expertise with which to make such determinations. Further, information which may initially appear to be inaccurate, irrelevant, untimely or incomplete may, when gathered, grouped, and evaluated 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 on results obtained during criminal investigations. The Customs Service therefore believes that it is appropriate to exempt the above-listed systems of records from the provisions of 5 U.S.C. 552a(e)(5).
(k) 5 U.S.C. 552a(e)(8) requires that an agency make reasonable efforts to serve notice on an individual when any record on the individual is made available to any person under compulsory
(l) 5 U.S.C. 552a(g) provides civil remedies to an individual for an agency refusal to amend a record or to make a review of a request for amendment, for an agency refusal to grant access to a record, for an agency failure to maintain accurate, relevant, timely and complete records which are used to make a determination which is adverse to the individual, and for an agency failure to comply with any other provision of 5 U.S.C. 552a in such a way as to have an adverse effect on an individual. The Customs Service believes that the above-listed systems of records should be exempted from this provision to the extent that the civil remedies provided therein may relate to provisions of 5 U.S.C. 552a from which the above-listed systems of records are proposed to be exempt. Since the provisions of 5 U.S.C. 552a enumerated in paragraphs (a) through (k) above are proposed to be inapplicable to the above-listed systems of records for the reasons stated therein, there should be no corresponding civil remedies for failure to comply with the requirements of those provisions to which the exemption is proposed to apply. Further, the Customs Service believes that application of this provision to the above-listed systems of records would adversely affect its ability to conduct criminal investigations by exposing to civil court action every stage of the criminal investigative process in which information is compiled or used in order to identify, detect, apprehend and otherwise investigate persons suspected or known to be engaged in criminal conduct in violation of the Customs and related laws.
b.
1.
2.
(b) 5 U.S.C. 552a (d)(1), (e)(4)(H) and (f) (2), (3) and (5) enable individuals to gain access to records pertaining to them. The Customs Service believes that application of these provisions to the above-listed systems of records would impair its ability to complete or continue civil or criminal investigations and inquiries and to detect and apprehend violators of the Customs and related laws. Permitting access to records contained in the above-listed systems of records would provide violators with significant information concerning the nature of the civil or criminal investigation or inquiry. Knowledge of the facts developed during an investigation or inquiry would enable violators of criminal and civil laws and regulations to learn the extent to which the investigation or inquiry has progressed, and this could provide them with an opportunity to destroy evidence that would form the basis for prosecution or the imposition of civil sanctions. In addition, knowledge gained through access to investigatory material could alert a violator to the need to temporarily postpone commission of the violation or to change the intended point where the violation is to be committed so as to avoid detection or apprehension. Further, access to investigatory material would disclose investigative techniques and procedures which, if known, could enable violators to structure their future operations in such a way as to avoid detection or apprehension, thereby neutralizing investigators’ established and effective investigative tools and procedures. In addition, investigatory material may contain the identity of a confidential source of information or other informer who would not want his identity to be disclosed for reasons of personal privacy or for fear of reprisal at the hands of the individual about whom he supplied information. In some cases mere disclosure of the information provided by an informer would reveal the identity of the informer either through the process of elimination or by virtue of the nature of the information supplied. If informers cannot be assured that their identities (as sources for information) will remain confidential, they would be very reluctant in the future to provide information pertaining to violations of criminal and civil laws and regulations, and this would seriously compromise the ability of the Customs Service to carry out its mission. Further, application of 5 U.S.C. 552a (d)(1), (e)(4)(H) and (f) (2), (3) and (5) to the above-listed systems
(c) 5 U.S.C. 552a(d) (2), (3) and (4), (e)(4)(H) and (f)(4), which are dependent upon access having been granted to records pursuant to the provisions cited in subparagraph (b) above, enable individuals to contest (seek amendment to) the content of records contained in a system of records and require an agency to note an amended record and to provide a copy of an individual's statement (of disagreement with the agency's refusal to amend a record) to persons or other agencies to whom the record has been disclosed. The Customs Service believes that the reasons set forth in subparagraph (b) above are equally applicable to this subparagraph, and, accordingly, those reasons are hereby incorporated herein by reference.
(d) 5 U.S.C. 552a(c)(3) requires that an agency make accountings of disclosures of records available to individuals named in the records at their request; such accountings must state the date, nature and purpose of each disclosure of a record and the name and address of the recipient. The Customs Service believes that application of this provision to the above-listed systems of records would impair the ability of the Customs Service and other law enforcement agencies to conduct investigations and inquiries into civil and criminal violations under their respective jurisdictions. Making accountings available to violators would alert those individuals to the fact that the Customs Service or another law enforcement authority is conducting an investigation or inquiry into their activities, and such accountings could reveal the geographic location of the investigation or inquiry, the nature and purpose of the investigation or inquiry and the nature of the information disclosed, and the dates on which that investigation or inquiry was active. Violators possessing such knowledge would thereby be able to take appropriate measures to avoid detection or apprehension by altering their operations, transferring their activities to other locations or destroying or concealing evidence which would form the basis for prosecution or the imposition of civil sanctions.
(e) 5 U.S.C. 552a(e)(1) 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 term “maintain” as defined in 5 U.S.C. 552a(a)(3) includes “collect” and “disseminate.” At the time that information is collected by the Customs Service there is often insufficient time to determine whether the information is relevant and necessary to accomplish a purpose of the Customs Service; in many cases information collected may not be immediately susceptible to a determination of whether the information is relevant and necessary, particularly in the early stages of investigation or inquiry, and in many cases information which initially appears to be irrelevant and unnecessary may, upon further evaluation or upon continuation of the investigation or inquiry, prove to have particular relevance to an enforcement program of the Customs Service. Further, not all violations of law uncovered during a Customs Service investigation or inquiry fall within the civil or criminal jurisdiction of the Customs Service; in order to promote effective law enforcement it often becomes necessary and desirable to disseminate information pertaining to such violations to other law enforcement agencies
c.
(a)
(b)
(c)
(1)
(2)
(i) The release of accounting disclosures would put the subject of a criminal investigation on notice of the existence of an investigation and that he is the subject of that investigation;
(ii) It would provide the subject of a criminal investigation with an accurate accounting of the date, nature, and purpose of each disclosure and the name and address of the person or agency to whom the disclosure is made. Obviously, the release of such information to the subject of a criminal investigation would provide him with significant information concerning the nature of the investigation and could result in impeding or compromising the efforts of law enforcement personnel to detect and arrest persons suspected of criminal activity;
(iii) Disclosure to the individual of the disclosure accounting after the investigation is closed would alert the individual as to which agencies were investigating him and would put him on notice concerning the scope of his suspected criminal activities and could aid him in avoiding detection and apprehension.
b. 5 U.S.C. 552a (c)(4); (d); (e)(4) (G) and (H); (f) and (g): The foregoing provisions of the Privacy Act relate to an individual's right to notification of the existence of records pertaining to him and access to such records; the agency procedures relating to notification, access and contest of the information contained in such records; and the civil remedies available to the individual in the event of adverse determinations by an agency concerning access to or amendment of information contained in record systems. The reasons why the Criminal Investigation Information System of records is exempted from the foregoing provisions are as follows:
(i) To notify an individual at his request of the existence of records pertaining to him in the Criminal Investigation Information System would inform the individual of the existence of an investigation and that he is the subject of that investigation. This would enable the individual to avoid detection and would further enable him to inform co-conspirators of the fact that an investigation is being conducted;
(ii) To permit access to the records contained in the Criminal Investigation Information System would not only inform an individual that he is or was the subject of a criminal investigation, but would also provide him with significant information concerning the nature of the investigation which might enable him to avoid detection or apprehension;
(iii) To grant access to an on-going or closed criminal investigative file could interfere with Secret Service investigative and enforcement proceedings, deprive co-defendants of a right to a fair trial or an impartial adjudication, constitute an unwarranted invasion of the personal privacy of others, disclose the identity of confidential sources and reveal confidential information supplied by such sources, and disclose investigative techniques and procedures, or endanger the life or physical safety of law enforcement personnel, informants, witnesses, and other persons supplying information to investigators.
c. 5 U.S.C. 552a(e)(4)(I). This provision of the Privacy Act requires the publication of the categories of sources of
(i) Revealing sources of information could disclose investigative techniques and procedures;
(ii) Revealing sources of information could result in retaliation and threat of reprisal by the subject under investigation against such sources;
(iii) Revealing sources of information could cause witnesses, informants and others who supply information to criminal investigators to refrain from giving such information because of fear of reprisal, or fear of breach of promises of anonymity and confidentiality;
(iv) Revealing sources of information could result in the refusal of some sources to give full and complete information or to be candid with investigators because of the knowledge that the identity of such sources may be disclosed.
d. 5 U.S.C. 552a(e)(1): This provision of the Privacy Act requires each agency to maintain in its records only such information about an individual as is relevant and necessary to accomplish a purpose of the agency. The reasons why the Criminal Investigation Information System of records is exempted from the foregoing provisions are as follows:
(i) In a criminal investigation it is difficult to accurately determine the relevancy and necessity of information during the process of information gathering. Only after the information is evaluated can the relevancy and necessity of such information be ascertained;
(ii) In a criminal investigation, the Secret Service often obtains information concerning the violations of laws other than those within the scope of its criminal investigative jurisdiction. In the interest of effective law enforcement, the Secret Service should retain this information as it may aid in establishing patterns of criminal activity, and provide valuable leads for those law enforcement agencies charged with enforcing other segments of the criminal law;
(iii) In interviewing persons, or obtaining other forms of evidence during a criminal investigation, information will be supplied to the investigator which relates to matters which are ancillary to the main purpose of the investigation but which may relate to matters under the investigative jurisdiction of another agency. Such information is not readily susceptible to segregation.
e. 5 U.S.C. 552a(e)(2): This provision of the Privacy Act 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 right, benefits and privileges under Federal programs. The reasons why the Criminal Investigation Information System is exempted from the foregoing provision are as follows:
(i) In certain instances, the subject of a criminal investigation is not required to supply information to investigators as a matter of legal right. In those instances, information relating to a subject's criminal activities must be obtained from other sources;
(ii) A requirement that information be collected from an individual who is the subject of a criminal investigation would put the individual on notice of the existence of the investigation and could enable him to avoid detection or apprehension;
(iii) In a criminal investigation it is necessary to obtain evidence from a variety of sources other than the subject of the investigation in order to accumulate and verify the evidence necessary for the successful prosecution of persons suspected of violating the criminal laws.
f. 5 U.S.C. 552a(e)(3): This provision of the Privacy Act requires an agency to inform each individual whom it asks to supply information of the authority which authorizes the solicitation of the information and whether disclosure of such information is mandatory or voluntary; the principal purposes for which the information is intended to be used; the routine uses which may be made of the information; and the effect on the individual of not providing the requested information. The reasons why the Criminal Investigation Information System is exempted from the foregoing provision are as follows:
(i) Informing each individual who is asked to supply information in a criminal investigation of the information required under the foregoing provision could inform the individual of the existence of a confidential investigation; reveal the identity of confidential sources of information; and endanger the life or physical safety of confidential informants;
(ii) Informing each individual who is asked to supply information in a criminal investigation of the information required under the foregoing provision could result in an unwarranted invasion of the privacy of individuals who may be the subject of a criminal investigation or who are suspected of engaging in criminal activity;
(iii) Informing each individual who is asked to supply information in a criminal investigation of the information required under the foregoing provision would inhibit such individuals from supplying the requested information and thereby present a serious impediment to the successful investigation and prosecution of violations of the criminal law.
g. 5 U.S.C. 552a(e)(5): This provision of the Privacy Act requires an agency to maintain all records which are used in making any determination about an individual with such accuracy, relevance, timeliness, and completeness as is reasonably necessary to assure fairness to the individual in the determination. The reasons why the Criminal Investigation Information System is exempted from the foregoing provisions are as follows:
(i) In gathering information during the course of a criminal investigation it is usually not possible to determine in advance what information is accurate, relevant, timely, and complete. Seemingly nonrelevant or untimely information may acquire new significance as an investigation progresses;
(ii) The restrictions on the maintenance of the records contained in the foregoing provision could impede investigators and intelligence analysts in the exercise of their judgment and discretion in reporting on criminal investigations;
(iii) Compliance with the records maintenance criteria listed in the foregoing provision could require the periodic up-dating of Secret Service criminal investigations to insure that the records maintained in the system remain timely and complete.
h. 5 U.S.C. 552a(e)(8): This provision of the Privacy Act requires an agency to make reasonable efforts to serve notice to an individual when any record on such individual is made available to any person under compulsory legal process becomes a matter of public record. The reasons why the Criminal Investigation Information System is exempted from the foregoing provision are as follows:
(i) The notice requirement of the foregoing provision could impede law enforcement by revealing investigative techniques and procedures;
(ii) The notice requirement of the foregoing provision could reveal the existence of confidential investigations to individuals who are the subjects of such investigations.
i. The foregoing exemptions are claimed for materials maintained in the Criminal Investigation Information System to the extent that such materials contain information and reports described in 5 U.S.C. 552a(j) (2). Further, records maintained in the Criminal Investigation Information System described in 5 U.S.C. 552a(k) are exempted from subsections (c)(3), (d) (1), (2), (3) and (4), (e)(1), (e)(4) (G), (H) and (I) and (f) of 5 U.S.C. 552a for the reasons previously stated.
(1) Provisions from which exempted: The Non-Criminal Investigation Information System maintained by the Secret Service contains records similar to those described in 5 U.S.C. 552a(k), the Privacy Act of 1974. Exemptions are claimed for such described records where appropriate from the following provisions of the Privacy Act of 1974: subsections (c)(3), (d) (1), (2), (3) and (4), (e)(1), (e)(4) (G), (H) and (I) and (f) of 5 U.S.C. 552a.
(2)
(i) The release of accounting disclosures would put the subject of an investigation on notice of the existence of an investigation and that he is the subject of that investigation;
(ii) It would provide the subject of an investigation with an accurate accounting of the date, nature, and purpose of each disclosure and the name and address of the person or agency to whom the disclosure is made. Obviously, the release of such information to the subject of an investigation would provide him with significant information concerning the nature of the investigation and could result in impeding or compromising the efforts of law enforcement personnel to obtain information essential to the successful conclusion of the investigation;
(iii) Disclosure to the individual of the disclosure accounting after the investigation is closed would alert the individual as to which agencies were investigating him; put him on notice concerning the scope of his suspected activities and reveal investigatory techniques and the identity of confidential informants. It could result in an invasion of privacy of private citizens who provide information in connection with a particular investigation.
b. 5 U.S.C. 552a; (d), (e)(4) (G), (H) and (f): The foregoing provisions of the Privacy Act relate to an individual's right to notification of the existence of records pertaining to him and access to such records and the agency procedures relating to notification, access and contest of the information contained in such records. The reasons why the Non-Criminal Investigation Information System of records is exempted from the foregoing provisions are as follows:
(i) To notify an individual at his request of the existence of records pertaining to him in the Non-Criminal Investigation Information System would inform the individual of the existence of an investigation and that he is the subject of that investigation. This could enable the individual to secrete or destroy evidence essential to the successful completion of the investigation;
(ii) To permit access to the records contained in the Non-Criminal Investigation System would not only inform an individual that he is or was the subject of an investigation, but would also provide him with significant information concerning the nature of the investigation which might enable him to avoid detection or apprehension;
(iii) To grant access to an on-going or closed non-criminal investigative file would interfere with Secret Service investigative and enforcement proceedings; deprive other parties involved in the investigations of a right to a fair trial or an impartial adjudication; constitute an unwarranted invasion of the personal privacy of others; disclose the identity of confidential sources and reveal confidential information supplied by such sources; and disclose investigative techniques and procedures.
c. 5 U.S.C. 552a 3 (e)(4)(I). This provision of the Privacy Act requires the publication of the categories of sources of records in each system of records. The reasons why the Non-Criminal Investigation Information System of records is exempted from the foregoing provision are as follows:
(i) Revealing sources of information would disclose investigative techniques and procedures;
(ii) Revealing sources of information would result in retaliation and threat of reprisal by the subject under investigation against such sources;
(iii) Revealing sources of information could cause witnesses, informants and others who supply information to investigators to refrain from giving such information because of fear of reprisal, or fear of breach of promises of anonymity and confidentiality;
(iv) Revealing sources of information could result in the refusal of some sources to give full and complete information or to be candid with investigators because of the knowledge that the identity of such sources may be disclosed.
d. 5 U.S.C. 552a(e)(1): This provision of the Privacy Act requires each agency to maintain in its records only such
(i) In a non-criminal investigation it is difficult to determine accurately the relevancy and necessity of information during the process of information gathering. It is only after the information is evaluated that the relevancy and necessity of such information can be ascertained;
(ii) In a non-criminal investigative case, the Secret Service often obtains information concerning the violation of laws other than those within the scope of its jurisdiction. In the interest of effective law enforcement, it is desirable that the Secret Service retain this information since it can aid in establishing patterns of unlawful activity and provide valuable leads for those law enforcement agencies that are charged with enforcing other segments of the criminal, regulatory and civil laws;
(iii) In interviewing persons, or obtaining other forms of evidence during an investigation, information will be supplied to the investigator which relates to matters which are ancillary to the main purpose of the investigation but which may relate to matters under the investigative jurisdiction of another agency. Such information is not readily susceptible to segregation.
e. The foregoing exemptions are claimed for records maintained in the Non-Criminal Investigation Information System only to the extent that such records contain materials described in subsection (k) of 5 U.S.C. 552a, the Privacy Act of 1974.
(1)
(2)
(i) The release of accounting disclosures would put the subject of a protective intelligence file on notice of the existence of an investigation and that he is the subject of that investigation;
(ii) It would provide the subject of a protective intelligence file with an accurate accounting of the date, nature, and purpose of each disclosure and the name and address of the person or agency to whom the disclosure is made. Obviously, the release of such information to the subject of a protective intelligence file would provide him with significant information concerning the nature of the investigation, and could result in impeding or compromising the efforts of Secret Service 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;
(iii) Disclosures of the disclosure accounting after the protective intelligence file is closed would alert the individual as to which agencies were investigating him and would put him on notice concerning the scope of the protective intelligence investigation and could aid him in avoiding detection.
b. 5 U.S.C. 552a (c)(4); (d); (e)(4) (G) and (H); (f) and (g): The foregoing provisions of the Privacy Act relate to an individual's right to notification of the existence of records pertaining to him and access to such records; the agency procedures relating to notification; access and contest of the information contained in such records; and the civil remedies available to the individual in the event of adverse determinations by an agency concerning access to or amendment of information contained in record systems. The reasons why the Protection Information System of records is exempted from the foregoing provisions are as follows:
(i) To notify an individual at his request of the existence of records pertaining to him in the Protection Information System would be injurious to the protective intelligence activities of the Secret Service if the existence of files on the subject were even acknowledged. Granting access to the criminal and the unstable person would necessarily lead to knowledge of the sources of Secret Service information and could endanger other enforcement and intelligence operations and confidential sources including co-workers, friends and relatives of the subjects of such records;
(ii) Limitation on access to the materials contained in the Protection Information System is considered necessary to the preservation of the utility of intelligence files and in safeguarding those persons the Secret Service is authorized to protect. Without such denial of access the Protection Information System could adversely effect in the poor quality of information available; in compromised confidential sources; in the inability to keep track of persons of protective interest; and from interference with Secret Service protective intelligence activities by individuals gaining access to protective intelligence files. Many of the persons on whom records are maintained in the Protection Information System suffer from mental aberrations. Knowledge of their condition and progress comes from authorities, family members and witnesses. Many times this information comes to the Secret Service 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;
(iii) Permitting access to protective intelligence files would reveal techniques and procedures, not only of Secret Service protective investigations but could reveal the criteria by which protective intelligence subjects are evaluated;
(iv) To notify an individual at his request of the existence of records pertaining to him in the Protection Information System would inform the individual of the existence of an investigation and that he is the subject of protective interest. This would enable the individual to avoid detection and would further enable him to inform co-conspirators of the fact that an investigation is being conducted;
(v) To permit access to the records contained in the Protection Information System would not only inform an individual that he is or was the subject of protective interest, but would also provide him with significant information concerning the nature of any investigation concerning his activities;
(vi) To grant access to current or closed protective intelligence files would interfere with Secret Service investigative and enforcement proceedings; deprive co-defendants of a right to a fair trial or an impartial adjudication; constitute an unwarranted invasion of the personal privacy of others; disclose the identity of confidential
c. 5 U.S.C. 552a(e)(4)(I). This provision of the Privacy Act requires the publication of the categories of sources of records in each system of records. The reasons why the Protection Information System of records is exempted from the foregoing provision are as follows:
(i) Revealing sources of information would disclose investigative techniques and procedures;
(ii) Revealing sources of information would result in retaliation and threat of reprisal by the subject of a protective intelligence file;
(iii) Revealing sources of information would cause witnesses, informants and others who supply information to Secret Service investigators to refrain from giving such information because of fear of reprisal, or fear of breach of promises of anonymity and confidentiality;
(iv) Revealing sources of information would result in the refusal of some sources to give full and complete information or to be candid with investigators because of the knowledge that the identity of such sources may be disclosed.
d. 5 U.S.C. 552a(e)(1): This provision of the Privacy Act requires each agency to maintain in its records only such information about an individual as is relevant and necessary to accomplish a purpose of the agency. The reasons why the Protection Information System of records is exempted from the foregoing provisions are as follows:
(i) In gathering protective intelligence information it is difficult to determine accurately the relevancy and necessity of information during the process of information gathering. It is only after the information is evaluated that the relevancy and necessity of such information can be ascertained;
(ii) In carrying out protective intelligence responsibilities the Secret Service often obtains information concerning the violation of laws other than those within the scope of its protective intelligence jurisdiction. In the interest of effective law enforcement, it is desirable that the Secret Service retain this information since it can aid in establishing patterns of criminal activity and provide valuable leads for those law enforcement agencies that are charged with enforcing other segments of the criminal law;
(iii) During protective intelligence investigations, information will be supplied to the investigator which relates to matters which are ancillary to the main purpose of the investigation but which may relate to matters under the investigative jurisdiction of another agency. Such information is not readily susceptible to segregation.
e. 5 U.S.C. 552a(c)(2): This provision of the Privacy Act 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 reasons why the Protection Information System is exempted from the foregoing provision are as follows:
(i) In certain instances, where the protective intelligence subject is suspected of criminal activity, he is not required to supply information to investigators as a matter of legal right. In those instances, information relating to a subject's criminal activities must be obtained from other sources;
(ii) A requirement that information be collected from an individual who is of protective interest would put the individual on notice of the existence of the intelligence investigation and such knowledge would enable him to avoid detection in the event that the individual attempted to physically harm persons protected by the Secret Service;
(iii) In a protective intelligence investigation where the subject of the investigation is suspected of engaging in criminal activities it is necessary to obtain evidence from a variety of sources other than the subject of the investigation in order to accumulate and verify the evidence necessary for the successful prosecution of persons suspected of violating the criminal laws.
f. 5 U.S.C. 552a(e)(3): This provision of the Privacy Act requires an agency to inform each individual whom it asks to supply information of the authority which authorizes the solicitation of the information and whether disclosure of such information is mandatory or voluntary; the principle purposes for which the information is intended to be used; the routine uses which may be made of the information; and the effect on the individual of not providing the requested information. The reasons why the Protection Information System is exempted from the foregoing provision are as follows:
(i) Informing each individual who is asked to supply information in a protective intelligence investigation of the information required under the foregoing provision would inform the individual of the existence of a confidential investigation; reveal the identity of confidential sources of information; and endanger the life or physical safety of confidential informants;
(ii) Informing each individual who is asked to supply information in a protective intelligence investigation of the information required under the foregoing provision would result in an unwarranted invasion of the privacy of individuals who may be the subject of a criminal investigation or who are suspected of engaging in criminal activity;
(iii) Informing each individual who is asked to supply information in a protective intelligence investigation of the information required under the foregoing provision would inhibit such individuals from supplying the requested information and thereby present a serious impediment to the success of the Secret Service in carrying out its protective intelligence activities.
g. 5 U.S.C. 552a(e)(5): This provision of the Privacy Act requires an agency to maintain all records which are used in making any determination about an individual with such accuracy, relevance, timeliness, and completeness as is reasonably necessary to assure fairness to the individual in the determination. The reasons why the Protection Information System is exempted from the foregoing provisions are as follows:
(i) In gathering information during the course of a protective intelligence investigation it is usually not possible to determine in advance what information is accurate, relevant, timely, and complete. Seemingly nonrelevant or untimely information may acquire new significance as an investigation progresses;
(ii) The restrictions on the maintenance of the records contained in the foregoing provision would impede investigators and intelligence analysts in the exercise of their judgment and discretion in reporting on protective intelligence subjects;
(iii) Compliance with the records maintenance criteria listed in the foregoing provision would require the periodic up-dating of Secret Service protective intelligence files to insure that the records maintained in the system remain timely and complete.
h. 5 U.S.C. 552a(e)(8): This provision of the Privacy Act requires an agency to make reasonable efforts to serve notice to an individual when any record on such individual is made available to any person under compulsory legal process becomes a matter of public record. The reasons why the Protection Information System is exempted from the foregoing provision are as follows:
(i) The notice requirement of the foregoing provision could impede Secret Service protective efforts by revealing techniques and procedures;
(ii) The notice requirements of the foregoing provision could reveal the existence of confidential investigations to individuals who are the subjects of such investigations.
i. The foregoing exemptions are claimed for materials maintained in the Protection Information System to the extent that such materials contain information and reports described in 5 U.S.C. 552a(j)(2). Further, records maintained in the Protection Information System described in 5 U.S.C. 552a(k) are to be exempted from subsections (c)(3), (d) (1), (2), (3) and (4); (e)(1), (e)(4) (G), (H) and (I) and (f) of 5 U.S.C. 552a for the reasons previously stated.
In accordance with 5 U.S.C. 552a (j) and (k), general notice is hereby given of rulemaking under the Privacy Act of 1974 by the Director, Bureau of Alcohol, Tobacco and Firearms. The Director, Bureau of Alcohol, Tobacco and Firearms, exempts the systems of records identified in paragraphs (a), (b) and (c) of this section from certain provisions of the Privacy Act of 1974 as set forth in such paragraphs.
(a)
(1) The Privacy Act of 1974 creates several methods by which individuals who are of record in this system of records may discover information collected about their criminal activities. These methods are as follows: subsections (e)(4)(G) and (f)(1) allow individuals to ascertain whether their criminal activities have been recorded; subsections (d)(1), (e)(4)(H), and (f) (2), (3) and (5) establish the ability of individuals to gain access into the investigatory files maintained on their criminal activities; subsections (d) (2), (3) and (4), (e)(4)(H), and (f)(4) presuppose access and further enable individuals to contest the contents of their criminal files; subsection (c)(3) allows individuals to discover if other law enforcement agencies are investigating their criminal activities and subsection (e)(4)(I) discloses the categories of sources of records in the system. Since these subsections are variations upon the criminal subjects’ ability to ascertain whether a Federal law enforcement agency has uncovered their criminal misdeeds, these subsections have been grouped together for purposes of this notice.
(A) With respect to subsections (e)(4)(G) and (f)(1), the Bureau of Alcohol, Tobacco and Firearms believes that imposition of these requirements would identify to individuals the fact that they are of record, and in so doing, compromise the ability of ATF to successfully complete an investigation into violations of law. Where individuals have the ability to discover the location and specific character of their investigative records in this system, they will be able to determine the nature of the investigation, the type of surveillance utilized and the precise stage of the investigation into their criminal activities. When individuals can determine that the investigation into their criminal activities has been closed, they are placed on notice that they may safely resume their illegal conduct. For these reasons, ATF seeks exemption of this system from subsections (e)(4)(G) and (f)(1).
(B) With respect to subsections (d)(1), (e)(4)(H) and (f) (2), (3) and (5), the Bureau of Alcohol, Tobacco and Firearms believes that access into criminal investigative files poses present and future dangers on the ability of this agency to effectively enforce the criminal laws committed to its administration. Where individuals may break into an ongoing criminal investigative file they discover the collection of facts which will form the basis of their arrests. Knowledge of these facts enables them to destroy valuable contraband or other evidence of their activities prior to lawful seizure and thereby prevent enforcement proceedings. The ongoing investigative file may reveal that reasonable cause exists to believe that a crime is about to be committed. Disclosure of these facts enable individuals with criminal intent to either postpone the commission of their criminal acts or relocate the scene of the crime to an alternatively acceptable location where Federal agents will not be anticipated. After a criminal investigation has been closed, information in the file nevertheless reveals to the investigated subjects the techniques and procedures utilized by a law enforcement agency. Knowledge of these investigative techniques and procedures by individuals and groups devoted to crime enables them to structure their future operations in such a way as to place these activities beyond discovery until after the crime has
(C) With respect to subsections (d) (2), (3) and (4), (e)(4)(H), and (f)(4), which presuppose access and provide for contest of the content of records contained in this system, the Bureau of Alcohol, Tobacco and Firearms believes that the reasons set forth in subparagraph (B) of paragraph (1) of this subsection are equally applicable to this subparagraph, and are hereby incorporated by reference. For these reasons, ATF seeks exemption of this system from subsections (d) (2), (3) and (4), (e)(4)(H) and (f)(4).
(D) With respect to subsection (c)(3) which provides for making the accounting of disclosures available to the requester, the Bureau of Alcohol, Tobacco and Firearms believes that access to this accounting by a subject under investigation would impair the ability of other law enforcement agencies to utilize information developed by ATF for their investigations into violations of criminal laws not enforced by ATF. Where the interstate criminal activities of individuals or groups span the jurisdictions of several law enforcement agencies, information will be shared by these agencies in their attempts to bring these violators to justice. Disclosure of the accounting will alert such individuals to which agencies are conducting investigations, the geographic locations of such investigations, the nature and purpose of the investigations, and the date during which the investigation received information maintained by ATF. Supplied with this information, individuals or groups may ascertain which of their criminal activities have been discovered and the law enforcement agencies which are in current pursuit. For these reasons, ATF seeks exemption of this system from subsection (c)(3).
(E) With respect to subsection (e)(4)(I), which requires publication of the categories of sources for a record system, the Bureau of Alcohol, Tobacco and Firearms believes that imposition of subsection (e)(4)(I) upon this system would reveal investigative techniques and procedures. For this reason, ATF seeks exemption of this system from subsection (e)(4)(I).
(2) The Privacy Act of 1974 provides, at subsection (e)(1), that an agency may maintain only such information about an individual as is relevant and necessary to accomplish a purpose of
(3) The Privacy Act of 1974 provides at subsection (e)(2) that an agency must collect information to the greatest extent practicable directly from the subject individual. The Bureau of Alcohol, Tobacco and Firearms believes that this system should be exempted from subsection (e)(2) because most information gathered upon a subject under investigation is obtained from third parties and witnesses. There is a minimal degree of practicability in contacting a criminal subject for purposes of seeking information as to his criminal activities. Such contact alerts the individual that he is under investigation and affords him opportunity to conceal his criminal activities or otherwise avoid detection or apprehension. In certain instances, the subject of a criminal investigation is not required to supply information to investigators as a matter of legal right. Law violators seldom give self-incriminatory information about their involvement in criminal activities. In those instances, information relating to the subject's criminal activities must be obtained from other sources. For these reasons, ATF seeks exemption of this system from subsection (e)(2).
(4) The Privacy Act of 1974 provides at subsection (e)(3) that each individual must be informed of the authority, principle purposes, and routine uses and effects on the individual when requested to provide information. The Bureau of Alcohol, Tobacco and Firearms believes that this system should be exempted from subsection (e)(3). When information is obtained by undercover officers, conformity to (e)(3) discloses their identity as agents of a law enforcement authority and thereby impairs their physical safety as well as the successful conclusion of the investigation. When presented with a written statement complying with (e)(3) by special agents acting in undercover capacity, the individual may not thereafter be completely open with such agents. For these reasons, ATF seeks exemption of this system from subsection (e)(3).
(5) The Privacy Act of 1974 provides at subsection (e)(5) that an agency maintain all records which are used in making any determination about an individual with such accuracy, relevance, timeliness, and completeness as is reasonably necessary to assure fairness to the individual in the determination. Since the law defines “maintain” to include collection of information, the Bureau of Alcohol, Tobacco and Firearms believes that this system should be exempt from subsection (e)(5) because it would prohibit the initial collection of any data not shown to be accurate, relevant, timely or complete at the moment of its collection. In gathering information during the course of
(6) The Privacy Act of 1974 provides, at subsection (e)(8), that an agency must make reasonable efforts to serve notice on an individual when his records are made available pursuant to compulsory legal process, when such process becomes a matter of public record. Such a requirement would impose unnecessary and unusual administrative demands on the Bureau of Alcohol, Tobacco and Firearms by requiring a record system to follow up on legal process emanating from court proceedings to which ATF is not a party. The Bureau of Alcohol, Tobacco and Firearms believes the duty of serving notice in such a case properly rests with the moving party who seeks disclosure by utilization of the court's compulsory legal process. Further, in most cases where an individual's criminal records have been disclosed pursuant to compulsory legal process, the individual who is the subject of the records will be a party to the proceedings and will have actual notice of the disclosure. For these reasons, ATF seeks exemption of this system from subsection (e)(8).
(7) The Privacy Act of 1974 provides, at subsection (g), civil remedies for agency failure to grant access, agency failure to amend records, agency failure to maintain accurate, relevant, timely and complete records and agency failure to comply with provisions of the Privacy Act which have an adverse effect on an individual. The Bureau of Alcohol, Tobacco and Firearms believes that this system should be exempted from subsection (g) because the civil remedies provided in this subsection apply to provisions in the Privacy Act which have been exempted from application to this system by virtue of this notice. Since these provisions are not intended to apply to this system, there should be no corresponding civil penalty for failure to comply with the requirements of these sections due to exercise of the exemption authority. ATF believes that application of this subsection to this system of records would impair ATF's ability to conduct investigations into the criminal behavior of suspects because every step in the investigation process in which information is compiled for prosecution purposes would be susceptible to civil action under this subsection. For these reasons, ATF seeks exemption of this system from subsection (g).
(b)
(1) The Privacy Act of 1974 creates several methods by which individuals may discover records containing information on such individuals and consisting of investigatory material compiled for law enforcement purposes. These methods are as follows: subsection (c)(3) allows individuals to discover if other agencies are investigating such individuals; subsections (d)(1), (e)(4)(H), and (f) (2), (3) and (5) establish the ability of individuals to gain access to investigatory material compiled on such individuals; subsections (d) (2), (3) and (4), (e)(4)(H) and (f)(4) presuppose access and enable individuals to contest the contents of investigatory material compiled on these individuals; and subsections (e)(4)(G) and (f)(1) allow individuals to determine whether or not they are under investigation. Since these subsections are variations upon the individuals’ ability to ascertain whether their civil or criminal misdeeds have been discovered, these
(A) The Bureau of Alcohol, Tobacco and Firearms believes that imposition of the requirements of subsection (c) (3), requiring accounting of disclosures be made available to individuals, would impair the ability of ATF and other investigative entities to conduct investigations of alleged or suspected violations of civil or criminal laws. Making the accounting of disclosures available identifies to individuals which investigative entities are investigating the individuals, the nature of the violations of which they are suspected, and the purpose for the exchange of information. Supplied with this information, the individuals concerned would be able to alter their ongoing and future illegal activities, conceal or destroy evidentiary materials and documents, and otherwise seriously impair the successful completion of investigations. Further, where individuals learn the geographic location and identity of the investigative entities which are interested in them, such individuals are able to move the site of their illegal activities or become secure in the knowledge that their illegal activities have not been detected in particular geographic locations. For these reasons, ATF seeks an exemption from the requirements of subsection (c)(3).
(B) With respect to subsections (d) (1), (e)(4)(H), and (f) (2), (3) and (5), the Bureau of Alcohol, Tobacco and Firearms believes that access into investigatory material would prevent the successful completion of ongoing investigations. Individuals who gain access to investigatory material compiled on them discover the nature and extent of the violations of civil or criminal laws which they are suspected or alleged to have committed. By gaining access, such individuals also learn the facts developed during an investigation. Knowledge of the facts and the nature and extent of the suspected or alleged violations enables these individuals to destroy materials or documents which would have been used as evidence against them. In addition, knowledge of the facts and the suspected violations gives individuals, who are committing ongoing violations or who are about to commit violations of civil or criminal laws, the opportunity to temporarily postpone the commission of the violations or to effectively disguise the commission of these violations. Access to material compiled on investigated individuals reveals investigative techniques and the procedures followed in conducting investigations. Disclosure of these techniques and procedures enables individuals who intend to violate civil or criminal laws to structure their future illegal activities in such a way that they escape detection. Investigative material may contain the identity of confidential sources of information. Individuals who gain access to investigatory material compiled on them learn the identity of these confidential sources. Even where the name of the source is not revealed, investigated individuals may learn the identity of confidential sources by the process of elimination or by the very nature of the information contained in the files. Where the identity of confidential sources has been revealed, they may be subject to various forms of reprisal. If confidential sources of information are subjected to reprisals or the fear of reprisals, they would become reluctant to provide information necessary to identify or prove the guilt of individuals who violate civil or criminal laws. Without the information that is often supplied by confidential sources, the ability of investigative entities would be seriously impaired. For the reasons stated in this paragraph, ATF seeks exemption from the requirements of subsections (d)(1), (e)(4)(H), and (f) (2), (3) and (5).
(C) With respect to subsections (d) (2), (3) and (4), (e) (4) (H), and (f) (4), the Bureau of Alcohol, Tobacco and Firearms believes that the imposition of these requirements, which presuppose access and provide for amending records, would impair ATF's ability to conduct investigations for the same reasons stated in the preceding paragraph (b)(1)(B), and are incorporated by reference herein. Therefore, ATF seeks exemption from the requirements of subsections (d) (2), (3) and (4), (e)(4)(H), and (f)(4).
(D) With respect to subsections (e) (4)(G) and (f)(1), the Bureau of Alcohol, Tobacco and Firearms believes that informing individuals that they are of
(2) Subsection (e)(1) of the Privacy Act of 1974 requires that ATF maintain in its records only information that is relevant and necessary to accomplish a purpose of ATF required to be accomplished by statute or by executive order of the President. The Bureau of Alcohol, Tobacco and Firearms believes that imposition of such requirement would seriously impair the ability of ATF and other investigative entities to effectively investigate suspected or alleged violations of civil or criminal laws. Where individuals are engaged in a broad variety of violations, if ATF were only to collect information necessary and relevant to laws under ATF's jurisdiction, ATF would be unable to perform one of its functions, i.e., working with other governmental agencies which have similar jurisdictional concerns. Additionally, it is often impossible to determine whether or not information is relevant and necessary until the investigation is completed. When initially collected, information may appear irrelevant or immaterial. However, when this information is placed together with additional data gathered at a later stage of the investigation, the initially collected irrelevant information may form the basis for reasonable cause to believe additional violations of law are present or additional suspects are involved. Until all facts have been gathered and evaluated it may not be possible to determine relevancy and materiality. For these reasons, ATF seeks an exemption from the requirement of subsection (e)(1).
(c)
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 proposed exemption and are subject to all the requirements of the Privacy Act.
The sections of the Act from which this system of records are exempt are in general those providing for individual access to records. When such access would cause the identity of a confidential source to be revealed, it would impair the future ability of the Treasury 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 are exempt from section (e)(1) which requires that the agency maintain in its records only such information about an individual
If any investigations within the scope of section (k)(5) become involved with civil or criminal matters, exemptions from the Act could also be asserted under sections (k)(2) or (j)(2).
(d)
(2) When there is a request for information which has been classified by ATF pursuant to Executive Order 11652 and Treasury Order 160, ATF will 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. After declassification, the information shall be made available to the individual, unless an exemption is claimed. If the information continues to warrant classification, the provisions of EO 11652 shall apply.
(3) Requests for information which have been exempted from disclosure pursuant to 5 U.S.C. 552a(k)(2) shall be responded to in the manner provided in paragraph (d)(1) of this section unless a review of the information indicates that the information has been 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 and shall be provided the information except to the extent it 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.
(4) 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 it 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.
(5) Even though the exemptions described in paragraphs (a), (b) and (c) of this section may be fully applicable, the Bureau may, if not precluded by law, elect under the circumstances of a particular case not to apply the exemption; or to exempt only a part. The fact that the exemption is not applied by the Bureau in a particular case has no precedential significance as to the application of the exemption to such matter in other cases. It is merely an indication that in the particular case involved, the Bureau finds no compelling necessity for applying the exemption to such matter. Where the Bureau has elected not to apply an exemption, in whole or in part, Appendix E of 31 CFR part 1, subpart C, relating to ATF's notice, access and amendment procedures shall apply to the records requested only to the extent that the exemption was not asserted.
(a)
(b)
(c)
(1)
(2)
(i) The release of accounting disclosures would put the subject of a security investigation on notice of the existence of an investigation and that he is the subject of that investigation;
(ii) It would provide the subject of an investigation with an accurate accounting of the date, nature, and purpose of each disclosure and the name and address of the person or agency to whom the disclosure is made. Obviously, the release of such information to the subject of a security investigation would provide him with significant information concerning the nature of the investigation and could result in impeding or compromising the efforts of Bureau Security personnel to detect and report persons suspected of illegal, unlawful, or unauthorized activity;
(iii) Disclosure to the individual of the disclosure accounting after the investigation is closed would alert the individual as to which agencies were investigating him and would put him on notice concerning the scope of his suspected improper activities and could aid him in avoiding detection and apprehension.
b. 5 U.S.C. 552a(d) (1), (2), (3), (4); (e)(4) (G) and (H); and (f): The foregoing provisions of the Privacy Act relate to an individual's right to notification of the existence of records pertaining to him and access to such records; the agency procedures relating to notification, access and contest of the information continued in such records. The reasons why the Investigative Files are exempted from the foregoing provisions are as follows:
(i) To notify an individual at his request of the existence of records pertaining to him in the Investigative Files would inform the individual of the existence of an investigation and that he is the subject of that investigation. This would enable the individual to avoid detection and would further enable him to inform co-conspirators of the fact that an investigation is being conducted;
(ii) To permit access to the records contained in the Investigative Files would not only inform an individual that he is or was the subject of a security investigation, but would also provide him with significant information concerning the nature of the investigation which might enable him to avoid detection or apprehension;
(iii) To grant access to an on-going or closed investigative file could interfere with Office of Security investigative proceedings, disclose the identity of confidential sources and reveal confidential information supplied by such sources, and disclose investigative techniques and procedures, or endanger the life or physical safety of Office of Security personnel, informants, witnesses, and other persons supplying information to investigators.
c. 5 U.S.C. 552a(e)(4)(I). This provision of the Privacy Act requires the publication of the categories of sources of records in each system of records. The reasons why the Investigative Files are exempted from the foregoing provision are as follows:
(i) Revealing sources of information could disclose investigative techniques and procedures;
(ii) Revealing sources of information could result in retaliation and threat of reprisal by the subject under investigation against such sources;
(iii) Revealing sources of information could cause witnesses, informants and others who supply information to Office of Security investigators to refrain from giving such information because of fear of reprisal, or fear of breach of promises of anonymity and confidentiality;
(iv) Revealing sources of information could result in the refusal of some sources to give full and complete information or to be candid with investigators because of the knowledge that the identity of such sources may be disclosed.
d. 5 U.S.C. 552a(e)(1): This provision of the Privacy Act requires each agency to maintain in its records only such information about an individual as is relevant and necessary to accomplish a purpose of the agency. The reasons why the Investigative Files are exempted from the foregoing provision are as follows:
(i) In a security investigation it is difficult to determine accurately the relevancy and necessity of information during the process of information gathering. It is only after the information is evaluated that the relevancy and necessity of such information can be ascertained;
(ii) In a security investigation, the Office of Security often obtains information concerning the violation of laws other than those within the scope of its responsibilities. In the interest of effective law enforcement, it is desirable that the Office of Security retain this information since it can aid in establishing patterns of criminal activity and provide valuable leads for those law enforcement agencies that are charged with enforcing other segments of the criminal law;
(iii) In interviewing persons, or obtaining other forms of evidence during a criminal investigation, information will be supplied to the investigator which relates to matters which are ancillary to the main purpose of the investigation but which may relate to matters under the investigative jurisdiction of another agency. Such information is not readily susceptible to segregation.
e. The foregoing exemptions are claimed for materials maintained in the Investigative Files to the extent that such materials contain information and reports described in 5 U.S.C. 552a(k)(2).
The Bureau of Engraving and Printing exempts under section (k) of the Privacy Act of 1974, 5 U.S.C. 552a, the Bureau's Personnel Security Files and Personnel Security Files and Indices from sections (c)(3), (d), (e)(1), (e)(4)(G) through (e)(4)(I), and (f) of the Act. The records maintained in the exempt systems of records are of the type described in section (k)(5) of the Act:
The sections of the Act from which this system of records are exempt are in general those providing for individual access to records. When such access would cause the identity of a confidential source to be revealed, it would impair the future ability of the Treasury 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 are exempt from section (e)(1) which requires that the agency maintain in its records only such information about an individual as is relevant and necessary to accomplish a statutory or executively ordered purpose. The Director finds that to fulfill the requirements of section (e)(1) would unduly restrict the agency
If any investigations within the scope of section (k)(5) become involved with civil and criminal matters, exemptions from the Act should also be asserted under sections (k) (2) or (j) (2).
(a)
(b)
(c)
(d)
(e)
(a)
(1) Enforcement and Compliance Information;
(2) Federal Bureau of Investigation Report Card index;
(3) Chief Counsel's Management Information System.
(b)
(c)
(2) To the extent that the exemption under 5 U.S.C. 552a(j)(2) does not apply to the above named systems of records, then the exemption under 5 U.S.C. 552a(k)(2) relating to investigatory material compiled for law enforcement purposes is claimed for certain records in the systems. Exemptions will be claimed for such records only where appropriate.
(3) The provisions of the Privacy Act of 1974 from which exemptions are claimed under 5 U.S.C. 552a(j)(2) are as follows:
(d)
(2) To the extent that information contained in the above-named systems has as its principal purpose the enforcement of criminal laws, the exemption for such information under 5 U.S.C. 552a(j)(2) is claimed.
(3) Provisions of the Privacy Act of 1974 from which exemptions are claimed under 5 U.S.C. 552a(k)(2) are as follows:
(e)
(2) 5 U.S.C. 552a(c)(4), (d)(1), (2), (3), and (4), (e)(4)(G) and (H), (f), and (g) relate to an individual's right to be notified of the existence of records pertaining to such individual; requirements for identifying an individual who requests access to records; the agency procedures relating to access to records and the content of information contained in such records; and the civil remedies available to the individual in the event of adverse determinations by an agency concerning access to or amendment of information contained in record systems. These systems are exempt from the foregoing provisions for the following reasons: To notify an individual at the individual's request of the existence of records in an investigative file pertaining to such individual or to grant access to an investigative file could: interfere with investigative and enforcement proceedings; interfere with co-defendants’ rights to a fair trial; constitute an unwarranted
(3) 5 U.S.C. 552a(e)(4)(I) requires the publication of the categories of sources of records in each system of records. The application of this provision could disclose investigative techniques and procedures and cause sources to refrain from giving such information because of fear of reprisal, or fear of breach of promises of anonymity and confidentiality. This would compromise the ability to conduct investigations, and to identify, detect, and apprehend violators.
(4) 5 U.S.C. 552a(e)(1) requires each agency to maintain in its records only such information about an individual that is relevant and necessary to accomplish a purpose of the agency required by statute or Executive order. An exemption from the foregoing is needed:
(i) Because it is not possible to detect relevance or necessity of specific information in the early stages of a criminal or other investigation.
(ii) Relevance and necessity are questions of judgment and timing. What appears relevant and necessary when collected may ultimately be determined to be unnecessary. It is only after the information is evaluated that the relevance can be established.
(iii) In any investigation the Comptroller of the Currency may obtain information concerning violations of laws other than those within the scope of its jurisdiction. In the interest of effective law enforcement, the Comptroller of the Currency should retain this information as it may aid in establishing patterns of criminal activity, and provide leads for those law enforcement agencies charged with enforcing other segments of criminal or civil law.
(iv) In interviewing persons, or obtaining other forms of evidence during an investigation, information may be supplied to the investigator which relates to matters incidental to the main purpose of the investigation but which may relate to matters under the investigative jurisdiction of another agency. Such information cannot readily be segregated.
(5) 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 the provision would impair investigations for the following reasons:
(i) In certain instances the subject of an investigation cannot be required to supply information to investigators. In those instances, information relating to a subject's illegal acts, violations of rules of conduct, or any other misconduct, etc., must be obtained from other sources.
(ii) Most information collected about an individual under investigation is obtained from third parties such as witnesses and informers. It is not feasible to rely upon the subject of the investigation as a source for information regarding his activities.
(iii) The subject of an investigation will be alerted to the existence of an investigation if an attempt is made to obtain information from the subject. This would afford the individual the opportunity to conceal any criminal activities in order to avoid apprehension.
(iv) In any investigation it is necessary to obtain evidence from a variety of sources other than the subject of the investigation in order to verify the evidence necessary for successful litigation.
(6)(i) 5 U.S.C. 552a(e)(3) requires that an agency must inform the subject of an investigation who is asked to supply information of:
(A) The authority under which the information is sought and whether disclosure of the information is mandatory or voluntary,
(B) The purposes for which the information is intended to be used,
(C) The routine uses which may be made of the information, and
(D) The effects on the subject, if any, of not providing the requested information.
(ii) The reasons for exempting these systems of records from the foregoing provision are as follows:
(A) The disclosure to the subject of the investigation as stated in paragraph (e)(6)(i)(B) would provide the subject with substantial information relating to the nature of the investigation and could impede or compromise the investigation.
(B) If the subject were informed as required by this provision, it could seriously interfere with information-gathering activities by requiring disclosure of sources of information and, therefore, impairing the successful conclusion of the investigation.
(C) Individuals may be contacted during preliminary information-gathering in investigations before any individual is identified as the subject of an investigation. Informing the individual of the matters required by this provision would hinder or adversely affect any present or subsequent investigations.
(7) 5 U.S.C. 552a(e)(5) requires that records be maintained with such accuracy, relevance, timeliness, and completeness as is reasonably necessary to assure fairness to the individual in making any determination about an individual. Since the law defines “maintain” to include the collection of information, complying with this provision would prevent the collection of any data not shown to be accurate, relevant, timely, and complete at the moment of its collection. In gathering information during the course of an investigation it is not possible to determine this prior to collection of the information. Facts are first gathered and then placed in a logical order which objectively proves or disproves suspected behavior on the part of the suspect. Material which may seem unrelated, irrelevant, incomplete, untimely, etc., may take on added meaning as an investigation progresses. The restrictions in this provision could interfere with the preparation of a complete investigative report.
(8) 5 U.S.C. 552a(e)(8) requires an agency to make reasonable efforts to serve notice on an individual when any record on such individual is made available to any person under compulsory legal process when such process becomes a matter of public record. The notice requirement of this provision could prematurely reveal an ongoing investigation to the subject of the investigation.
(f)
In accordance with 5 U.S.C. 552a (j) and (k), general notice is hereby given of rulemaking pursuant to the Privacy Act of 1974 by the Director, Office of Thrift Supervision, under authority delegated to him by the Secretary of the Treasury. The Director, Office of Thrift Supervision, exempts the systems of records identified in the paragraphs below from certain provisions of the Privacy Act of 1974 as set forth in such paragraphs.
a.
1.
2.
(b) 5 U.S.C. 552a (d)(1), (e)(4)(H) and (f)(2), (3) and (5) enable individuals to gain access to records pertaining to them. The OTS believes that application of these provisions to the above-listed systems of records would compromise its ability to complete or continue administrative investigations and to detect and apprehend violators of applicable laws. Permitting access to records contained in the above-listed systems of records would provide individuals with significant information concerning the nature of the investigation, and this could enable them to avoid detection or apprehension in the following ways: (1) by discovering the collection of facts which would form the basis of an enforcement action, and (2) by enabling them to destroy evidence of wrongful conduct which would form the basis of an enforcement action. Granting access to on-going or closed investigative files would also reveal investigative techniques and procedures, the knowledge of which could enable individuals planning illegal activity to structure their future operations in such a way as to avoid detection or apprehension, thereby neutralizing established investigative techniques and procedures. Further, granting access to investigative files and records could disclose the identities of confidential sources and other informers and the nature of the information which they supplied, thereby exposing them to possible reprisals for having provided information related to the activities of those individuals who are subjects of the investigative files and records; confidential sources and other informers might refuse to provide investigators with valuable information if they could not be secure in the knowledge that their identities would not be revealed through disclosure of either their names or the nature of the information they supplied, and this would seriously impair the ability of the OTS to carry out its mandate to enforce the applicable laws. Additionally, providing access to records contained in the above-listed systems of records could reveal the identities of individuals who compiled information regarding illegal activities, thereby exposing them to possible reprisals.
(c) 5 U.S.C. 552a(d) (2), (3) and (4), (e)(4)(H) and (f)(4), which are dependent upon access having been granted to records pursuant to the provisions cited in paragraph (b) above, enable individuals to contest (seek amendment to) the content of records contained in a system of records and require an agency to note an amended record and to provide a copy of an individual's statement (of disagreement with the agency's refusal to amend a record) to persons or other agencies to whom the record has been disclosed. The OTS believes that the reasons set forth in paragraph (b) above are equally applicable to this subparagraph and, accordingly, those reasons are hereby incorporated herein by reference.
(d) 5 U.S.C. 552a(c)(3) requires that an agency make accountings of disclosures of records available to individuals named in the records at their request; such accountings must state the date, nature and purpose of each disclosure of a record and the name and address of the recipient. The OTS believes that application of this provision to the above-listed systems of records would impair the ability of other law enforcement agencies to make effective use of information provided by the OTS in connection with the investigation, detection and apprehension of violators of the laws enforced by those other law enforcement agencies. Making accountings of disclosure available to subjects would alert those individuals to the fact that another agency is conducting an investigation into their activities, and this could reveal the nature and purpose of that investigation, and the dates on which that investigation was active. Subjects possessing such knowledge would thereby be able
(e) 5 U.S.C. 552a(c)(4) requires that an agency inform any person or other agency about any correction or notation of dispute made by the agency in accordance with 5 U.S.C. 552(d) of any record that has been disclosed to the person or agency if an accounting of the record was made. Since this provision is dependent on an individual's having been provided an opportunity to contest (seek amendment to) records pertaining to him, and since the above-listed systems of records are proposed to be exempted from those provisions of 5 U.S.C. 552a relating to amendments of records as indicated in paragraph (c) above, the OTS believes that this provision should not be applicable to the above-listed systems of records.
(f) 5 U.S.C. 552a(e)(4)(I) requires that an agency publish a public notice listing the categories of sources for information contained in a system of records. The OTS believes that application of this provision to the above-listed systems of records could compromise its ability to conduct investigations and to identify, detect and apprehend violators of the applicable laws for the reasons that revealing sources for information could 1) disclose investigative techniques and procedures, 2) result in possible reprisal directed to informers by the subject under investigation, and 3) result in the refusal of informers to give information or to be candid with investigators because of the knowledge that their identities as sources might be disclosed.
(g) 5 U.S.C. 552a(e)(1) 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 term “maintain” as defined in 5 U.S.C. 552a(a)(3) includes “collect” and “disseminate.” At the time that information is collected by the OTS, there is often insufficient time to determine whether the information is relevant and necessary to accomplish a purpose of the OTS; in many cases information collected may not be immediately susceptible to a determination whether the information is relevant and necessary, particularly in the early stages of an investigation, and in many cases information which initially appears to be irrelevant and unnecessary may, upon further evaluation or upon continuation of the investigation, prove to have particular relevance to an enforcement program of OTS. Further, not all violations of law discovered during an OTS administrative investigation fall within the investigative jurisdiction of OTS; in order to promote effective law enforcement, OTS is often required to disseminate information pertaining to such violations to other law enforcement agencies which have jurisdiction over the offense to which the information relates. The OTS therefore believes that it is appropriate to exempt the above-listed systems of records from the provisions of 5 U.S.C. 552a(e)(1).
(h) 5 U.S.C. 552a(e)(2) requires that an agency 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 OTS believes that application of this provision to the above-listed systems of records would impair the ability of OTS to conduct investigations and to identify, detect and apprehend violators of applicable laws for the following reasons: (1) most information collected about an individual under investigation is obtained from third parties such as witnesses and informers, and it is usually not feasible to rely upon the subject of the investigation as a source for information regarding his activities, (2) an attempt to obtain information from the subject regarding an investigation will often alert the subject to the existence of such an investigation, thereby
(i) 5 U.S.C. 552a(e)(3) requires that an agency 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, of the authority which authorizes the solicitation of the information and whether disclosure of such information is mandatory or voluntary; the principal purposes for which the information is intended to be used; the routine uses which may be made of the information; and the effects on the individual of not providing all or part of the requested information. The OTS believes that the above-listed systems of records should be exempted from this provision in order to avoid adverse effects on its ability to identify, detect and apprehend violators of applicable laws. In many cases, information is obtained from confidential sources and other individuals under circumstances where it is necessary that the true purpose of their actions be kept secret so as not to alert the subject of the investigation or his associates that an investigation is in progress. In many cases, individuals for personal reasons would feel inhibited in talking to a person representing a law enforcement agency but would be willing to talk to a confidential source or a person who they believed was not involved in enforcement activity. In addition, providing information in this system with written evidence of who was the source, as required by this provision, could increase the likelihood that the source of information would be the subject of retaliatory action by the subject of the investigation. Further, application of this provision could result in an unwarranted invasion of the personal privacy of the subject of the investigation, particularly where further investigation would result in a finding that he was not involved in unlawful activity.
(j) 5 U.S.C. 552a(e)(5) requires that an agency maintain all records used by the agency 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. Since 5 U.S.C. 552a(a)(3) defines “maintain” to include “collect” and “disseminate,” application of this provision to the above-listed systems of records would hinder the initial collection of any information which 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 necessary flow of information from the OTS to other law enforcement agencies where an OTS investigation revealed information pertaining to a violation of law which was under the investigative jurisdiction of another agency. In collecting information during the course of an administrative investigation, it is not possible or feasible to determine accuracy, relevance, timeliness or completeness prior to collection of the information; in disseminating information to other law enforcement agencies it is often not possible to determine accuracy, relevance, timeliness or completeness prior to dissemination because the disseminating agency may not have the expertise with which to make such determinations. Further, information which may initially appear inaccurate, irrelevant, untimely or incomplete may, when gathered, grouped, and evaluated with other available information, become more pertinent as an investigation progresses. The OTS therefore believes that it is appropriate to exempt the above-listed systems of records from the provisions of 5 U.S.C. 552a(e)(5).
(k) 5 U.S.C. 552a(e)(8) requires that an agency make reasonable efforts to serve notice on an individual when any record on the individual is made available to any person under compulsory legal process when such process becomes a matter of public record. The OTS believes that the above-listed systems of records should be exempt from
(l) 5 U.S.C. 552a(g) provides civil remedies to an individual for an agency refusal to amend a record or to make a review of a request for amendment, for an agency refusal to grant access to a record, for an agency failure to maintain accurate, relevant, timely and complete records which are used to make a determination which is adverse to the individual, and for an agency failure to comply with any other provision of 5 U.S.C. 552a in such a way as to have an adverse effect on an individual. The OTS believes that the above-listed systems of records should be exempted from this provision to the extent that the civil remedies provided therein may be related to provisions of 5 U.S.C. 552a from which the above-listed systems of records are proposed to be exempt. Since the provisions of 5 U.S.C. 552a enumerated in paragraphs (a) through (k) above are proposed to be inapplicable to the above-listed systems of records for the reasons stated therein, there should be no corresponding civil remedies for failure to comply with the requirements of those provisions to which the exemption is proposed to apply. Further, the OTS believes that the application of this provision to the above-listed systems of records would adversely affect its ability to conduct investigations by exposing to civil court actions every stage of the investigative process in which information is compiled or used in order to identify, detect, apprehend and otherwise investigate persons suspected or known to be engaged in conduct in violation of applicable laws.
b.
1.
2.
(b) 5 U.S.C. 552a (d)(1), (e)(4)(H) and (f)(2), (3) and (5) enable individuals to gain access to records pertaining to them. The OTS believes that application of these provisions to the above-listed systems of records would impair its ability to complete or continue investigations and inquiries and to detect and apprehend violators of the applicable laws. Permitting access to records contained in the above-listed systems of records would provide subjects with significant information concerning the nature of the investigation or inquiry. Knowledge of the facts developed during an investigation or inquiry would enable violators of laws and regulations to learn the extent to which the investigation or inquiry has progressed, and this could provide
(c) 5 U.S.C. 552a(d) (2), (3) and (4), (e)(4)(H) and (f)(4), which are dependent upon access having been granted to records pursuant to the provisions cited in subparagraph (b) above, enable individuals to contest (seek amendment to) the content of records contained in a system of records and require an agency to note an amended record and to provide a copy of an individual's statement (of disagreement with the agency's refusal to amend a record) to persons or other agencies to whom the record has been disclosed. The OTS believes that the reasons set forth in subparagraph (b) above are equally applicable to this subparagraph, and, accordingly, those reasons are hereby incorporated herein by reference.
(d) 5 U.S.C. 552a(c)(3) requires that an agency make accountings of disclosures of records available to individuals named in the records at their request; such accountings must state the date, nature and purpose of each disclosure of a record and the name and address of the recipient. The OTS believes that application of this provision to the above-listed systems of records would impair the ability of the OTS and other law enforcement agencies to conduct investigations and inquiries into potential violations under their respective jurisdictions. Making accountings available to subjects would alert those individuals to the fact that the OTS or another law enforcement authority is conducting an investigation or inquiry into their activities, and such accountings could reveal the geographic location of the investigation or inquiry, the nature and purpose of the investigation or inquiry and the nature of the information disclosed, and dates on which that investigation or inquiry was active. Subjects possessing such knowledge would thereby be able to take appropriate measures to avoid detection or apprehension by altering their operations, transferring their activities to other locations or destroying or concealing evidence
(e) 5 U.S.C. 552a(e)(1) 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 term “maintain” as defined in 5 U.S.C. 552a(a)(3) includes “collect” and “disseminate.” At the time that information is collected by the OTS there is often insufficient time to determine whether the information is relevant and necessary to accomplish a purpose of the OTS; in many cases information collected may not be immediately susceptible to a determination of whether the information is relevant and necessary, particularly in the early stages of investigation or inquiry; and in many cases information which initially appears to be irrelevant and unnecessary may, upon further evaluation or upon continuation of the investigation or inquiry, prove to have particular relevance to an enforcement program of the OTS. Further, not all violations of law uncovered during an OTS investigation or inquiry fall within the jurisdiction of the OTS; in order to promote effective law enforcement it often becomes necessary and desirable to disseminate information pertaining to such violations to other law enforcement agencies which have jurisdiction over the offense to which the information relates. The OTS therefore believes that it is appropriate to exempt the above-listed systems of records from provisions of 5 U.S.C. 552a(e)(1).
1.
2.
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.
4.
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.
6.
General Counsel, Department of the Treasury, Room 3000, Main Treasury Building, 1500 Pennsylvania Avenue, NW., Washington, DC 20220.
7.
8.
(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.
1.
(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 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
2.
3.
(b)
(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 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)
(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:
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.
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.
(e)
(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 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
(f)
(g)
(h)
(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)
4.
(b)
(c)
(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)
(e)
(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)
(g)
(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
(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)
(i)
(j)
(k)
5.
1.
2.
(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.
(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.
5.
6.
7.
8.
1.
2.
a.
b.
c.
3.
4.
5.
6.
7.
1.
2.
3.
4.
(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.
6.
7.
8.
9.
10.
1.
2.
3.
4.
5.
6.
7.
(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.
1.
2.
3.
4.
5.
6.
7.
1.
2.
3.
4.
5.
6.
7.
1.
2.
3.
4.
5.
6.
7.
1.
2.
3.
4.
5.
6.
7.
1.
2.
3.
4.
5.
6.
7.
1.
2.
3.
4.
5.
6.
7.
1.
2.
Requests may be delivered in person to: Office of Thrift Supervision, Information Services Division, 1700 G Street, NW., Washington, DC.
3.
Privacy Act Amendment Requests may be delivered in person to: Office of Thrift Supervision, Information Services Division, 1700 G Street, NW., Washington, DC.
4.
Appeals may be delivered in person to: Office of Thrift Supervision, Information Services Division, 1700 G Street, NW., Washington, DC.
5.
6.
7.
8.
(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.
31 U.S.C. 321; E.O. 12958, 60 FR 19825, 3 CFR, 1995 Comp., p. 333.
(a) National security information (hereinafter also referred to as “classified information”) shall be classified at one of the following three levels:
(1)
(2)
(3)
(b)
(c)
Designations of original classification authority for national security information are contained in Treasury Order (TO) 102-19 (or successor order), which is published in the
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
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”.
(a)
(b)
(a)
(b)
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)
(1)
(2)
(3)
(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
(c)
(d)
(e)
(1) For information to be declassified automatically on a specific date:
(2) For information to be declassified automatically upon the occurrence of a specific event:
(3) For information not to be declassified automatically:
(4) For information to be downgraded automatically on a specific date or upon occurrence of a specific event:
(f)
(i) For an unclassified transmittal document:
(ii) For a classified transmittal document:
(2)
(3)
(4)
(5)
(6)
(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
(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)
(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 § 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 § 2.7(a)(3);
(5) Specially designated markings as prescribed in § 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: “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 § 2.7(a) (1), (2), and (3).
(h)
(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.
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).
Delegations of derivative classification authority to officials not otherwise identified in § 2.9, shall be in writing and reported annually each October 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.
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
(a)
(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)
(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)
(1) The ability to segregate and describe the elements of information;
(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.
Information classified derivatively on the basis of source documents or classification guides shall bear all markings prescribed in § 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)
(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
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.
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 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 § 2.7(h).
(a)
(b)
(c)
(d)
(e)
(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)
(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
(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 § 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 § 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 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
(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
(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.
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.
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.
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.
(a)
(b)
(c)
(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 § 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
(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 § 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.
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.
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. 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.
(a)
(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 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 § 2.28(b), whenever Top Secret information is sent outside of a Treasury bureau or office within the Departmental Offices.
(b)
(c)
(d)
(1)
(2)
(3)
Classified information shall be stored only in facilities or under conditions designed to prevent unauthorized persons from gaining access to it.
(a)
(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.
(2)
(b)
(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.
(2)
(3)
(4)
(c)
(d)
(e)
(a)
(b)
(c)
(d)
(1)
(2)
(e)
(f)
(2)
(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 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
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.
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.
(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.
(a)
(b)
(c)
(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)
(e)
(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.
(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.
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.
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
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.
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 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
(a)
(b)
(c)
(d)
(e)
(f)
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 § 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 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.
(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
(3) Serve as the principal advisor to the Assistant Secretary (Management) with respect to Treasury physical and information security programs.
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.
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.
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.
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)
(b) [Reserved]
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(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)
(j)
(k)
(l)
(m)
(n)
(o)
(p)
(q)
(r)
(s)
(t)
(u)
(v)
(w)
(x)
(y)
(z)
28 U.S.C. 2672; 28 CFR part 14; 5 U.S.C. 301.
(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.
(a)
(b)
(c)
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 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.
(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.
(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
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.
(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 to the claim, by reason of the same subject matter.
Claims under this subpart must be presented in writing to the Department within 2 years after the claim accrued.
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.
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.
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.
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.
No claim will be considered under this subpart unless filed within 1 year from the date of the accrual of said claim.
(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 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.
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.”
31 U.S.C. 3721(j).
31 U.S.C. 3711.
The regulations of this part are issued under section 3 of the Federal Claims Collection Act of 1966, Pub. L. 89-508, 80 Stat. 308, 309, and in conformity with the Joint Regulations issued under that Act by the General Accounting Office and the Department of Justice prescribing standards for administrative collection, compromise, termination of agency collection action, and referral to the General Accounting Office and to the Department of Justice for litigation, of civil claims by the Government for money or property, 4 CFR Chapter II.
The regulations of this part incorporate by this reference all provisions of the Joint Regulations of the General Accounting Office and the Department of Justice, and supplement those regulations by the prescription of procedures and directives necessary and appropriate for Treasury operations. The Joint Regulations and this part do not apply to tax claims nor to any claim as to which there is an indication of fraud or misrepresentation, as described in § 101.3 of the Joint Regulations, unless returned by the Justice Department to the Treasury Department for handling.
The heads of bureaus and offices and their delegates are designated as designees of the Secretary of the Treasury authorized to perform all the duties for which the Secretary is responsible under the foregoing Act and Joint Regulations:
(a) The authority of the Secretary of the Treasury or the head of a bureau or office within the Treasury Department to compromise claims of the United States shall be exercised with respect to claims not exceeding $20,000, exclusive of interest, in conformity with the Federal Claims Collection Act, the Joint Regulations thereunder, and this part, except where standards are established by other statutes or authorized regulations issued pursuant thereto.
(b) The authority of the Secretary of the Treasury or the head of a bureau or office within the Treasury Department to remit or mitigate a fine, penalty or forfeiture shall be exercised in accordance with the standards for remission or mitigation established in the governing statute or in Departmental enforcement policies. In the absence of such standards, the standards of the Joint Regulations shall be followed to the extent applicable.
5 U.S.C. 5514; 5 CFR part 550, subpart K.
The purpose of the Debt Collection Act of 1982, (Pub. L. 97-365), is to provide a comprehensive statutory approach to the collection of debts due the Federal Government. These regulations implement section 5 of the Act which authorizes the collection of debts owed by Federal employees to the Federal Government by means of salary offsets, except that no claim may be collected by such means if outstanding for more than 10 years after the agency's right to collect the debt first accrued, unless facts material to the Government's right to collect were not known and could not reasonably have been known by the official or officials who were charged with the responsibility for discovery and collection of such debts. These regulations are consistent with the regulations on salary offset published by the Office of Personnel Management (OPM) on July 3, 1984, codified in Subpart K of part 550 of title 5 of the
(a) These regulations provide Departmental procedures for the collection by salary offset of a Federal employee's pay to satisfy certain debts owed the Government.
(b) These regulations apply to collections by the Secretary of the Treasury from:
(1) Federal employees who owe debts to the Department; and
(2) Employees of the Department who owe debts to other agencies.
(c) These regulations do not apply to debts or claims arising under the Internal Revenue Code of 1954, as amended (26 U.S.C. 1
(d) These regulations do not apply to any adjustment to pay arising out of an 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.
(e) Nothing in these regulations precludes the compromise, suspension, or termination of collection actions where appropriate under the standards implementing the Federal Claims Collection Act (31 U.S.C. 3711
The heads of bureaus and offices and their delegates are designated as designees of the Secretary of the Treasury
As used in this part (except where the context clearly indicates, or where the term is otherwise defined elsewhere in this part) the following definitions shall apply:
(a)
(1) An Executive Agency as defined by section 105 of Title 5, United States Code, including the U.S. Postal Service and the U.S. Postal Rate Commission;
(2) A military department as defined by section 102 of Title 5, United States Code;
(3) An agency or court of the judicial branch including a court as defined in section 610 of Title 28, United States Code, the District Court for the Northern Mariana Islands and the Judicial Panel on Multidistrict Litigation;
(4) An agency of the legislative branch, including the U.S. Senate and the U.S. House of Representatives; and
(5) Other independent establishments that are entities of the Federal Government.
(b)
(c)
(d)
(e)
(f)
(g)
(1) Federal employment taxes;
(2) Amounts deducted for the U.S. Soldiers’ and Airmen's Home;
(3) Fines and forfeiture ordered by a court martial or by a commanding officer;
(4) Federal, state or local income taxes no greater than would be the case if the employee claimed all dependents to which he or she is entitled and such additional amounts for which the employee presents evidence of a tax obligation supporting the additional withholding;
(5) Health insurance premiums;
(6) Normal retirement contributions (
(7) Normal life insurance premiums, exclusive of optional life insurance premiums (
(h)
(i) Federal Claims Collection Standards, “FCCS,” jointly published by the Department of Justice and the General Accounting Office at 4 CFR 101.1
(j)
(k)
(l)
(m)
(n)
(o)
(p)
(q)
These regulations are to be followed in instances where:
(a) The Department is owed a debt by an individual currently employed by another agency;
(b) Where the Department is owed a debt by an individual who is a current employee of the Department; or
(c) Where the Department currently employs an individual who owes a debt to another Federal Agency. Upon receipt of proper certification from the creditor agency, the Department will offset the debtor-employee's salary in accordance with these regulations.
These regulations do not preclude 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 in any way questioning the amount or validity of a debt by submitting a subsequent claim to the General Accounting Office in accordance with the procedures prescribed by the General Accounting Office. These regulations also do not preclude an employee from requesting a waiver pursuant to other statutory provisions pertaining to the particular debts being collected.
(a) Deductions under the authority of 5 U.S.C. 5514 shall not be made unless the creditor agency provides the employee with written notice that he/she owes a debt to the Federal Government, a minimum of 30 calendar days before salary offset is initiated. When Treasury is the creditor agency this notice of intent to offset an employee's salary shall be hand-delivered or sent by certified mail to the most current address that is available to the Department and will state:
(1) That the Secretary has reviewed the records relating to the claim and has determined that a debt is owed, the amount of the debt, and the facts giving rise to the debt;
(2) The Secretary's intention to collect the debt by means of deduction from the employee's current disposable pay account until the debt and all accumulated interest is paid in full;
(3) The amount, frequency, approximate beginning date, and duration of the intended deductions;
(4) An explanation of the Department's policy concerning interest, penalties and administrative costs including a statement that such assessments must be made unless excused in accordance with the Federal Claims Collection Standards, 4 CFR 101.1
(5) The employee's right to inspect and copy all records of the Department pertaining to the debt claimed or to receive copies of such records if personal inspection is impractical;
(6) The right to a hearing conducted by an impartial hearing official (an administrative law judge, or alternatively, a hearing official not under the supervision or control of the Secretary) with respect to the existence and amount of the debt claimed, or the repayment schedule (
(7) If not previously provided, the opportunity (under terms agreeable to the Department) to establish a schedule for the voluntary repayment of the debt or to enter into a written agreement to establish a schedule for repayment of the debt in lieu of offset. The agreement must be in writing, signed by both the employee and the creditor agency (4 CFR 102.2(e));
(8) The name, address and phone number of an officer or employee of the Department who may be contacted concerning procedures for requesting a hearing;
(9) The method and time period for requesting a hearing;
(10) That the timely filing of a petition for a hearing on or before the fifteenth calendar day following receipt of such notice of intent will stay the commencement of collection proceedings;
(11) The name and address of the office to which the petition should be sent;
(12) That the Department will initiate certification procedures to implement a salary offset, as appropriate, (which may not exceed 15 percent of the employee's disposable pay) not less than thirty (30) days from the date of receipt of the notice of debt, unless the employee files a timely petition for a hearing;
(13) That a final decision on the hearing (if one is requested) will be issued at the earliest practical date, but not later than sixty (60) days after the filing of the petition requesting the hearing, unless the employee requests and the hearing official grants a delay in the proceedings;
(14) That any knowingly false or frivolous statements, representations, or evidence may subject the employee to:
(i) Disciplinary procedures appropriate under Chapter 75 of Title 5, United States Code, part 752 of title 5,
(ii) Penalties under the False Claims Act, sections 3729-3731 of Title 31, United States Code or any other applicable statutory authority; and
(iii) Criminal penalties under sections 286, 287, 1001, and 1002 of Title 18, United States Code or any other applicable statutory authority;
(15) Any other rights and remedies available to the employee under statutes or regulations governing the program for which the collection is being made;
(16) That unless there are applicable contractual or statutory provisions to the contrary, that 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 (5 U.S.C. 5514); and
(17) Proceedings with respect to such debt are governed by section 5 of the Debt Collection Act of 1982 (5 U.S.C. 5514).
(b) The Department is not required to comply with paragraph (a) of this section for any adjustment to pay arising out of an 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.
(a)
(b)
(1) An employee waives the right to a hearing, and will have his or her disposable pay offset in accordance with the Department's offset schedule, if the employee:
(i) Fails to file a request for a hearing unless such failure is excused; or
(ii) Fails to appear at an oral hearing of which he or she was notified unless the hearing official determines failure to appear was due to circumstances beyond the employee's control (5 U.S.C. 5514).
(c)
(d)
(2) In response to a timely request submitted by the debtor, the designated official will notify the employee of the location and time when the employee may inspect and copy records related to the debt.
(3) If personal inspection is impractical, arrangements shall be made to send copies of such records to the employee.
(e)
(f)
(2) When the debtor is a Department employee, the Department may contact any agent of another agency designated in Appendix A to part 581 of title 5,
(g)
(2)
(i) Informal conferences with the hearing official or administrative law judge, 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; or
(iii) Formal written submissions, with an opportunity for oral presentation.
(3)
(4)
(h)
(i)
(1) A statement of the facts presented to support the origin, nature, and amount of the debt;
(2) The hearing official's findings, analysis and conclusions; and
(3) The terms of any repayment schedules, if applicable.
(j)
(a) The bureau salary offset coordination officer shall provide a certification to the paying agency in all cases where:
(1) The hearing official determines that a debt exists;
(2) The employee admits the existence and amount of the debt by failing to request a hearing; or
(3) The employee admits the existence of the debt by failing to appear at a hearing.
(b) The certification must be in writing and must state:
(1) The employee owes the debt;
(2) The amount and basis of the debt;
(3) The date the Government's right to collect the debt first accrued;
(4) The Department's regulations have been approved by OPM pursuant to 5 CFR part 550, subpart K;
(5) The amount and date of the lump sum payment;
(6) If the collection is to be made in installments, the number of installments to be collected, the amount of each installment, and the commencing date of the first installment, if a date other than the next officially established pay period is required; and
(7) The dates the action(s) was taken and that it was taken pursuant to 5 U.S.C. 5514.
(a) In response to a notice of intent to an employee may propose to repay the debt as an alternative to salary offset. Any employee who wishes to repay a debt without salary offset shall submit in writing a proposed agreement to repay the debt. The proposal shall admit the existence of the debt and set forth a proposed repayment schedule. Any proposal under this subsection must be received by the official designated in that notice within fifteen (15) calendar days after receipt of the notice of intent.
(b) When the Department is the creditor agency and in response to a timely proposal by the debtor, the Secretary will notify the employee whether the employee's proposed written agreement for repayment is acceptable. It is within the Secretary's discretion to accept a repayment agreement instead of proceeding by offset.
(c) If the Secretary decides that the proposed repayment agreement is unacceptable, the employee will have fifteen (15) days from the date he or she received notice of the decision to file a petition for a hearing.
(d) If the Secretary decides that the proposed repayment agreement is acceptable, the alternative arrangement must be in writing and signed by both the employee and the Secretary.
(a) An employee subject to salary offset or a voluntary repayment agreement, may, at any time, request a special review by the creditor agency of the amount of the salary offset or voluntary payment, based on materially changed circumstances such as, but not limited to catastrophic illness, divorce, death, or disability.
(b) In determining whether an offset would prevent the employee from meeting essential subsistence expenses (costs incurred for food, housing, clothing, transportation and medical care), the employee shall submit a detailed statement and supporting documents for the employee, 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.
(c) If the employee requests a special review under this section, the employee shall file an alternative proposed offset or payment schedule and a statement, with supporting documents, showing why the current salary offset or payments result in an extreme financial hardship to the employee.
(d) The Secretary shall evaluate the statement and supporting documents, and determine whether the original offset or repayment schedule imposes an extreme financial hardship on the employee. The Secretary shall notify the employee in writing of such determination, including, if appropriate, a revised offset or payment schedule.
(e) If the special review results in a revised offset or repayment schedule, the bureau salary offset coordination officer shall provide a new certification to the paying agency.
(a) Upon receipt of proper certification of the creditor agency, the bureau payroll office will send the employee a written notice of salary offset. Such notice shall, at a minimum:
(1) Contain a copy of the certification received from the creditor agency; and
(2) Advise the employee that salary offset will be initiated at the next officially established pay interval.
(b) The bureau payroll office shall provide a copy of the notice to the creditor agency and advise such agency of the dollar amount to be offset and the pay period when the offset will begin.
(a) The Secretary shall coordinate salary deductions under this subpart.
(b) The appropriate bureau payroll office shall determine the amount of an employee's disposable pay and will implement the salary offset.
(c) Deductions shall begin within three official pay periods following receipt by the payroll office of certification.
(d)
(2)
(3)
(4)
(e)
(f)
(a)
(i) Arrange for a hearing upon proper petition by a Federal employee; and
(ii) Prescribe, upon consultation with the General Counsel, such practices and procedures as may be necessary to carry out the intent of this regulation.
(2) The head of each bureau shall designate a salary offset coordination officer who will be responsible for:
(i) Ensuring that each notice of intent to offset is consistent with the requirements of § 5.11;
(ii) Ensuring that each certification of debt sent to a paying agency is consistent with the requirements of § 5.13;
(iii) Obtaining hearing officials from other agencies pursuant to § 5.12(f); and
(iv) Ensuring that hearings are properly scheduled.
(3)
(i) Certify, in writing, that the employee owes the debt, the amount and basis of the debt, the date on which payment(s) is due, the date the Government's right to collect the debt first accrued, and that the Department's regulations implementing 5 U.S.C. 5514 have been approved by the Office of Personnel Management;
(ii) Advise the paying agency of the action(s) taken under 5 U.S.C. 5514(b) and give the date(s) the action(s) was taken (unless the employee has consented to the salary offset in writing or signed a statement acknowledging receipt of the required procedures and the written consent or statement is forwarded to the paying agency);
(iii) Except as otherwise provided in this paragraph, submit a debt claim containing the information specified in paragraphs (a)(3) (i) and (ii) of this section and an installment agreement (or other instruction on the payment schedule), if applicable, to the employee's paying agency;
(iv) If the employee is in the process of separating, the Department must submit its debt claim to the employee's paying agency for collection as provided in § 5.12. The paying agency must certify the total amount of its collection and notify the creditor agency and the employee as provided in paragraph (b)(4) of this section. If the paying agency is aware that the employee is entitled to payments from the Civil Service Retirement Fund and Disability Fund, or other similar payments, it must provide written notification to the agency responsible for making such payments that the debtor owes a debt (including the amount) and that the provisions of his section have been fully complied with. However, the Department must submit a properly certified claim to the agency responsible for making such payments before the collection can be made.
(v) If the employee is already separated and all payments due from his or her former paying agency have been paid, the Department may request, unless otherwise prohibited, that money due and payable to the employee from the Civil Service Retirement Fund and Disability Fund (5 CFR 831.1801
(4) When an employee transfers to another paying agency, the Department shall not repeat the due process procedures described in 5 U.S.C. 5514 and this subpart to resume the collection. The Department must review the debt upon receiving the former paying agency's notice of the employee's transfer to make sure the collection is resumed by the paying agency.
(b)
(2)
(3)
(4)
(a) The Department shall assess interest, penalties and administrative costs on debts owed pursuant to 31 U.S.C. 3717 and 4 CFR 101.1
(a) In instances where the Department is the creditor agency, it shall promptly refund any amount deducted under the authority of 5 U.S.C. 5514 when:
(1) The debt is waived or otherwise found not to be owing the United States; or
(2) An administrative or judicial order directs the Department to make a refund.
(b) Unless required or permitted by law or contract, refunds under this subsection shall not bear interest.
(a) The Department will provide a hearing official upon request of the creditor agency when the debtor is employed by the Department and the creditor agency cannot provide a prompt and appropriate hearing before an administrative law judge or before a hearing official furnished pursuant to another lawful arrangement.
(b) The Department will provide a hearing official upon request of a creditor agency when the debtor works for the creditor agency and that agency cannot arrange for a hearing official.
(c) The bureau salary offset coordination officer will appoint qualified personnel to serve as hearing officials.
(d) Services rendered under this section will be provided on a fully reimbursable basis pursuant to the Economy Act of 1932,
An employee's involuntary payment of all or any portion of a debt being collected under this Subpart must not be construed as a waiver of any rights which the employee may have under 5 U.S.C. 5514 or any other provisions of a written contract or law unless there are statutory or contractual provisions to the contrary.
31 U.S.C. 3720A; 26 CFR 301.6402-6T.
(a) These regulations implement 31 U.S.C. 3720A which authorizes the IRS to reduce a tax refund by the amount of a past-due legally enforceable debt owed to the United States.
(b) For purposes of this section, a past-due legally enforceable debt referable to the IRS is a debt which is owed to the United States and:
(1) Except in the case of a judgment debt, has been delinquent for at least three months and will not have been delinquent more than ten years at the time the offset is made;
(2) Cannot be currently collected pursuant to the salary offset provisions of 5 U.S.C. 5514;
(3) Is ineligible for administrative offset under 31 U.S.C. 3716(a) by reason of 31 U.S.C. 3716(c)(2) or cannot be collected by administrative offset under 31 U.S.C. 3716(a) by the referring agency against amounts payable to the debtor by the referring agency;
(4) With respect to which the bureau has given the taxpayer at least sixty (60) days to present evidence that all or part of the debt is not past-due or legally enforceable, has considered evidence presented by such taxpayer, and determined that an amount of such debt is past-due and legally enforceable;
(5) Which, in the case of a debt to be referred to the Service after June 30, 1986, has been disclosed by the bureau to a consumer reporting agency as authorized by 31 U.S.C. 3711(f), unless the consumer reporting agency would be prohibited from reporting information concerning the debt by reason of 15 U.S.C. 1681c;
(6) With respect to which the Department has notified or has made a reasonable attempt to notify the taxpayer that:
(i) The debt is past due, and
(ii) Unless repaid within 60 days thereafter, the debt will be referred to the IRS for offset against any overpayment of tax; and
(7) Is at least $25.
The heads of bureaus and their delegates are designated as designees of the Secretary of the Treasury authorized to perform all the duties for which the Secretary is responsible under the foregoing statutes and IRS Regulations:
For purposes of this subpart:
(a) The Department, through the individual bureaus, will provide information to the Service within the time frame prescribed by the Commissioner of the IRS to enable the Commissioner to make a final determination as to the each bureau's participation in the tax refund offset program. Such information shall include a description of:
(1) The size and age of the bureau's inventory of delinquent debts;
(2) The prior collection efforts that the inventory reflects; and
(3) The quality controls the bureau maintains to assure that any debt the bureau may submit for tax refund offset will be valid and enforceable.
(b) In accordance with the timetable specified by the Commissioner, the bureau will submit test magnetic media to the IRS, in such form and containing such data as the IRS shall specify.
(c) The bureau shall establish a toll free telephone number that the IRS will furnish to individuals whose refunds have been offset to obtain information from the bureau concerning the offset.
(d) The bureau shall enter into a separate agreement with the IRS to provide for reimbursement of the Service's cost of administering the pilot tax refund offset program in 1987.
(a) The bureau head or his or her designee shall be the point of contact with the IRS for administrative matters regarding the offset program.
(b) The bureaus shall ensure that:
(1) Only those past-due legally enforceable debts described in § 5.23(b) are forwarded to the IRS for offset; and
(2) The procedures prescribed in the MOU between the bureau and the IRS are followed in developing past-due debt information and submitting the debts to the IRS.
(c) The bureau shall submit a notification of a taxpayer's liability for past-due legally enforceable debt to the IRS on magnetic media as prescribed by the IRS. Such notification shall contain:
(1) The name and taxpayer identifying number (as defined in section 6109 of the Internal Revenue Code) of the individual who is responsible for the debt;
(2) The dollar amount of such past-due and legally enforceable debt;
(3) The date on which the original debt became past-due;
(4) The designation of the referring bureau submitting the notification of liability and identification of the referring agency program under which the debt was incurred;
(5) A statement accompanying each magnetic tape by the referring bureau certifying that, with respect to each debt reported on the tape, all of the requirements of eligibility of the debt for referral for the refund offset have been satisfied. See § 5.23(b).
(d) A bureau shall promptly notify the IRS to correct Treasury data submitted when the bureau:
(1) Determines that an error has been made with respect to a debt that has been referred;
(2) Receives or credits a payment on such debt; or
(3) Receives notification that the individual owing the debt has filed for bankruptcy under Title 11 of the United States Code or has been adjudicated bankrupt and the debt has been discharged.
(e) When advising debtors of an intent to refer a debt to the IRS for offset, the bureau shall also advise the
(a) A bureau shall refer to the Service for collection by tax refund offset, from refunds otherwise payable in calendar year 1987, only such past-due legally enforceable debts owed to the Department:
(1) That are eligible for offset under the terms of 31 U.S.C. 3720A, section 6402(d) of the Internal Revenue Code, 26 CFR 301.6402-6T, and the MOU; and
(2) That information will be provided for each such debt as is required by the terms of the MOU.
(b) Such referrals shall be made by submitting to the Service a magnetic tape pursuant to § 5.27(c), together with an accompanying written certification to the Service by the bureau that the conditions or requirements specified in 26 CFR 301.6402-6T and the MOU have been satisfied with respect to each debt included in the referral on such tape. The bureaus certification shall be in the form specified in the MOU.
(a) The bureau must notify, or make a reasonable attempt to notify, the individual that:
(1) The debt is past due, and
(2) Unless repaid within 60 days thereafter, the debt will be referred to the Service for offset against any refund of overpayment of tax;
(b) The bureau shall provide a toll free telephone number for use in obtaining information from the bureau concerning the offset.
(c) The bureau shall give the individual debtor at least sixty (60) days from the date of the notification to present evidence to the bureau that all or part of the debt is not past-due or legally enforceable. The bureau shall consider the evidence presented by the individual and shall make a determination whether an amount of such debt is past-due and legally enforceable. For purposes of this subsection, evidence that collection of the debt is affected by a bankruptcy proceeding involving the individual shall bar referral of the debt to the Service.
(d) Notification given to a debtor pursuant to paragraphs (a), (b) and (c) of this section shall advise the debtor of how he or she may present evidence to the bureau that all or part of the debt is not past-due or legally enforceable. Such evidence may not be referred to, or considered by, individuals who are not officials, employees, or agents of the United States in making the determination required under paragraph (c) of this section. Unless such evidence is directly considered by an official or employee of the bureau, and the determination required under paragraph (c) of this section has been made by an official or employee of the bureau, any unresolved dispute with the debtor as to whether all or part of the debt is past-due or legally enforceable must be referred to the bureau for ultimate administrative disposition, and the bureau must directly notify the debtor of its determination.
31 U.S.C. 3701; 31 U.S.C. 3711; 31 U.S.C. 3716.
These regulations apply to the collection of debts owed to the United States arising from transactions with the Department, or where a request for an offset is received by the Department from another agency. These regulations are consistent with the Federal Claims Collection Standards on administrative offset issued jointly by the Department of Justice and the General Accounting Office as set forth in 4 CFR 102.3.
The heads of bureaus and offices and their delegates are designated as designees of the Secretary of the Treasury authorized to perform all the duties for which the Secretary is responsible under the foregoing statutes:
(a)
(b)
(a) The Secretary or his or her designee, after attempting to collect a debt from a person under section 3(a) of the Federal Claims Collection Act of 1966, as amended (31 U.S.C. 3711(a)), may collect the debt by administrative offset subject to the following:
(1) The debt is certain in amount; and
(2) It is in the best interests of the United States to collect the debt by administrative offset because of the decreased costs of collection and the acceleration in the payment of the debt;
(b) The Secretary, or his or her designee, may initiate administrative offset with regard to debts owed by a person to another agency of the United States Government, upon receipt of a request from the head of another agency or his or her designee, and a certification that the debt exists and that the person has been afforded the necessary due process rights.
(c) The Secretary, or his or her designee, may request another agency that holds funds payable to a Treasury debtor to offset the debt against the funds held and will provide certification that:
(1) The debt exists; and
(2) The person has been afforded the necessary due process rights.
(d) If the six-year period for bringing action on a debt provided in 28 U.S.C. 2415 has expired, then administrative offset may be used to collect the debt only if the costs of bringing such action are likely to be less than the amount of the debt.
(e) No collection by administrative offset shall be made on any debt that has been outstanding for more than 10 years unless facts material to the Government's right to collect the debt were not known, and reasonably could not have been known, by the official or officials responsible for discovering and collecting such debt.
(f) These regulations do not apply to:
(1) A case in which administrative offset of the type of debt involved is explicitly provided for or prohibited by another statute; or
(2) Debts owed by other agencies of the United States or by any State or local government.
Before collecting any debt through administrative offset, a notice of intent to offset shall be sent to the debtor by certified mail, return receipt requested, at the most current address that is available to the Department. The notice shall provide:
(a) A description of the nature and amount of the debt and the intention of the Department to collect the debt through administrative offset;
(b) An opportunity to inspect and copy the records of the Department with respect to the debt;
(c) An opportunity for review within the Department of the determination of the Department with respect to the debt; and
(d) An opportunity to enter into a written agreement for the repayment of the amount of the debt.
(a) A debtor may dispute the existence of the debt, the amount of debt, or the terms of repayment. A request to review a disputed debt must be submitted to the Treasury official who provided notification within 30 calendar days of the receipt of the written notice described in § 5.34.
(b) If the debtor requests an opportunity to inspect or copy the Department's records concerning the disputed claim, 10 business days will be granted for the review. The time period will be measured from the time the request for inspection is granted or from the time the copy of the records is received by the debtor.
(c) Pending the resolution of a dispute by the debtor, transactions in any of the debtor's account(s) maintained in the Department may be temporarily suspended. Depending on the type of transaction the suspension could preclude its payment, removal, or transfer, as well as prevent the payment of interest or discount due thereon. Should the dispute be resolved in the debtor's favor, the suspension will be immediately lifted.
(d) During the review period, interest, penalties, and administrative costs authorized under the Federal Claims Collection Act of 1966, as amended, will continue to accrue.
A debtor who admits liability but elects not to have the debt collected by administrative offset will be afforded an opportunity to negotiate a written agreement for the repayment of the debt. If the financial condition of the debtor does not support the ability to pay in one lump-sum, reasonable installments may be considered. No installment arrangement will be considered unless the debtor submits a financial statement, executed under penalty of perjury, reflecting the debtor's assets, liabilities, income, and expenses. The financial statement must be submitted within 10 business days of the Department's request for the statement. At the Department's option, a confess-judgment note or bond of indemnity with surety may be required for installment agreements. Notwithstanding the provisions of this section, any reduction or compromise of a claim will be governed by 4 CFR part 103 and 31 CFR 5.3.
(a) If the debtor does not exercise the right to request a review within the time specified in § 5.35 or if as a result of the review, it is determined that the debt is due and no written agreement is executed, then administrative offset shall be ordered in accordance with these regulations without further notice.
(b)
(1) That the debtor owes the debt;
(2) The amount and basis of the debt; and
(3) That the agency has complied with the requirements of 31 U.S.C. 3716, its own administrative offset regulations and the applicable provisions of 4 CFR part 102 with respect to providing the debtor with due process.
(c)
(1) Receipt of written certification from the creditor agency:
(i) That the debtor owes the debt;
(ii) The amount and basis of the debt;
(iii) That the agency has prescribed regulations for the exercise of administrative offset; and
(iv) That the agency has complied with its own administrative offset regulations and with the applicable provisions of 4 CFR part 102, including providing any required hearing or review.
(2) A determination by the Department that collection by offset against funds payable by the Department would be in the best interest of the United States as determined by the facts and circumstances of the particular case, and that such offset would not otherwise be contrary to law.
The Department may effect an administrative offset against a payment to be made to the debtor prior to the
Sec. 203(a)(1), Pub. L. 96-481, 94 Stat. 2325 (5 U.S.C. 504(c)(1)).
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.
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.
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:
(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;
(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.
(a) A prevailing applicant may receive an award for fees and expenses incurred in connection with the
(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.
(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.
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 § 6.3 under the respective bureau or office. The Secretary of the Treasury may by order delegate authority to take final
(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.
(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 § 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.
(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
(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.
(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.
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.
(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.
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.
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.
Judicial review of final agency decisions on awards may be sought as provided in 5 U.S.C. 504(c)(2).
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.
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.
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.
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.
(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.
(a) The General Counsel shall be responsible for determining, subject to
(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.
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.
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.
(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.
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.
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.
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.
(a)
(b)
(c)
(d)
(e)
(f)
(g)
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).
(a)
(b)
(a)
(b)
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.
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
(a)
(b)
(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)
(d)
(a)
(b)
(c)
(d)
(e)
(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.
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).
(a)
(b)
(c)
(a)
(b)
(c)
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.
(a)
(b)
(a)
(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)
(a)
(b)
No attorney, certified public accountant, or enrolled practitioner may unreasonably delay the prompt disposition of any matter before the Bureau.
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.
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.
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.
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.
(a)
(b)
(c)
(d)
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.
No attorney, certified public accountant, or enrolled practitioner may charge an unconscionable fee for representing a client in any matter before the Bureau.
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.
(a)
(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)
(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.
(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:
(c)
(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)
(e)
Nothing in the regulations in this part may be construed as authorizing persons not members of the bar to practice law.
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 or prospective client, by word, circular, letter, or by advertisement.
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
(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 § 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.
(a)
(b)
(a)
(b)
(a)
(b)
(a)
(b)
(c)
(a)
(b)
(c)
(d)
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.
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.
Motions and requests may be filed with the Director of Practice or with the Administrative Law Judge.
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 the Bureau. The Director of Practice may be represented by an Attorney or other employee of the Treasury Department.
(a)
(b)
(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.
(a)
(b)
(a)
(b)
(c)
(d)
(e)
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 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
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.
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.
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.
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.
On appeal from or review of the intial decision of the Administrative Law Judge, the Secretary shall make the 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.
(a)
(b)
(c)
(d)
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.
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).
As used herein,
(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.
(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:
(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.
(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.
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 separate pages marked “Business Confidential.”
(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
(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 § 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
(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.
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.
A report will be made and published in the
Sec. 3, 23 Stat. 258, secs. 2-12, 60 Stat. 237
Nomenclature changes affecting this part appear at 57 FR 41095, Sept. 9, 1992.
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; 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.
(a)
(b)
(c)
As used in this part, except where the context clearly indicates otherwise:
(a)
(b)
(c)
(d)
(e)
(f)
(g) A
(h)
(a)
(b)
(c)
(d)
(2) An individual who practices before the Internal Revenue Service pursuant to this subsection shall be subject to the provisions of this part in the same manner as attorneys, certified public accountants and enrolled agents.
(e)
(f)
(g)
(a)
(b)
(1) Application for enrollment on account of former employment in the Internal Revenue Service shall be made to the Director of Practice. Each applicant will be supplied a form by the Director of Practice, which shall indicate the information required respecting the applicant's qualifications. In addition to the applicant's name, address, citizenship, age, educational experience, etc., such information shall specifically include a detailed ascount of the applicant's employment in the Internal Revenue Service, which account shall show (i) positions held, (ii) date of each appointment and termination thereof, (iii) nature of services rendered in each position, with particular reference to the degree of technical experience involved, and (iv) name of supervisor in such positions, together with such other information regarding the experience and training of the applicant as may be relevant.
(2) Upon receipt of each such application, it shall be transmitted to the appropriate officer of the Internal Revenue Service with the request that a detailed report of the nature and rating of the applicant's services in the Internal Revenue Service, accompanied by the recommendation of the superior officer in the particular unit or division of the Internal Revenue Service that such employment does or does not qualify the applicant technically or otherwise for the desired authorization, be furnished to the Director of Practice.
(3) In examining the qualification of an applicant for enrollment on account of employment in the Internal Revenue Service, the Director of Practice will be governed by the following policies:
(i) Enrollment on account of such employment may be of unlimited scope or 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 his former employment in the Internal Revenue Service has qualified the applicant.
(ii) Application for enrollment on account of employment in the Internal Revenue Service must be made within 3 years from the date of separation from such employment.
(iii) It shall be requisite for enrollment on account of such employment that the applicant shall have had a minimum of 5 years continuous employment in the Service during which he shall 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.
(iv) For the purposes of paragraph (b)(3)(iii) of this section an aggregate of 10 or more years of employment, at least 3 of which occurred within the 5 years preceding the date of application, shall be deemed the equivalent of 5 years continuous employment.
(c)
(a)
(b)
(c)
(d)
(a)
(1) Who have been granted active enrollment to practice before the Internal Revenue Service;
(2) Whose enrollment has been placed in an inactive status for failure to meet the requirements for renewal of enrollment;
(3) Whose enrollment has been placed in an inactive retirement status;
(4) Who have been disbarred or suspended from practice before the Internal Revenue Service;
(5) Whose offer of consent to resignation from enrollment to practice before the Internal Revenue Service has been accepted by the Director of Practice under § 10.55 of this part; and
(6) Whose application for enrollment has been denied.
(b)
(c)
(d)
(1) All individuals enrolled to practice before the Internal Revenue Service before November 1, 1986 shall apply for renewal of enrollment during the period between November 1, 1986 and January 31, 1987. Those who receive initial enrollment between November 1, 1986 and January 31, 1987 shall apply for renewal of enrollment by March 1, 1987. The first effective date of renewal will be April 1, 1987.
(2) Thereafter, applications for renewal will be required between November 1, 1989 and January 31, 1990, and between November 1 and January 31 of every third year subsequent thereto. Those who receive initial enrollment during the renewal application period shall apply for renewal of enrollment by March 1 of the renewal year. The effective date of renewed enrollment will be April 1, 1990, and April 1 of every third year subsequent thereto.
(3) The Director of Practice will notify the individual of renewal of enrollment and will issue a card evidencing such renewal.
(4) A reasonable nonrefundable fee may be charged for each application for renewal of enrollment filed with the Director of Practice.
(5) Forms required for renewal may be obtained from the Director of Practice, Internal Revenue Service, Washington, DC 20224.
(e)
(1)
(ii) An individual who receives initial enrollment between January 1, 1986 and January 31, 1987 is exempt from the continuing education requirement for the renewal of enrollment effective April 1, 1987, but is required to file a timely application for renewal of enrollment.
(2)
(ii) A minimum of 16 hours of continuing education credit 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 such enrollment cycle. Enrollment for any part of a month is considered enrollment for the entire month.
(f)
(i) Be a qualifying program designed to enhance the professional knowledge of an individual in Federal taxation or Federal tax related matters, i.e. programs comprised of current subject matter in Federal taxation or Federal tax related matters to include accounting, financial management, business computer science and taxation; and
(ii) Be conducted by a qualifying sponsor.
(2)
(A) Require attendance;
(B) Require that the program be conducted by a qualified instructor, discussion leader or speaker, i.e. a person whose background, training, education and/or experience is appropriate for instructing or leading a discussion on the subject matter of the particular program; and
(C) Require a written outline and/or textbook and certificate of attendance provided by the sponsor, all of which must be retained by the attendee for a three year period following renewal of enrollment.
(ii)
(A) Require registration of the participants by the sponsor;
(B) Provide a means for measuring completion by the participants (e.g., written examination); and
(C) Require a written outline and/or textbook and certificate of completion provided by the sponsor which must be retained by the participant for a three year period following renewal of enrollment.
(iii)
(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 which meets the continuing education requirements of this part.
(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 will be 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% of the continuing education requirement for an enrollment cycle.
(D) Presentation of the same subject matter in an instructor, discussion leader or speaker capacity more than one time during an enrollment cycle will not qualify for continuing education credit.
(iv)
(A) Continuing education credit will be awarded for publications on Federal taxation or Federal tax related matters to include accounting, financial management, business computer science, 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 will be 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% of the continuing education requirement of any enrollment cycle.
(3)
(i) 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
(ii) Completing a minimum of 16 hours of qualifying continuing education during the last year of an enrollment cycle.
(g)
(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, possession, territory, Commonwealth, or the District of Columbia responsible for the issuance of a license in the field of accounting or law;
(iii) Be recognized by the Director of Practice as a professional organization or society whose programs include offering continuing professional education opportunities in subject matter within the scope of this part; or
(iv) File a sponsor agreement with the Director of Practice to 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 those who have successfully completed the program; and
(vi) Records must be maintained by the sponsor to verify completion of the program and attendance by each participant. Such records must be retained 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 shall request such status
(5) Sponsor agreements and qualified professional organization or society sponsors approved by the Director of Practice shall remain in effect for one enrollment cycle. The names of such sponsors will be published on a periodic basis.
(h)
(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)
(i) The name of the sponsoring organization;
(ii) The location of the program;
(iii) The title of the program and description of its content e.g., course syllibi and/or textbook;
(iv) The dates attended;
(v) The credit hours claimed;
(vi) The name(s) of the instructor(s), discussion leader(s), or speaker(s), if appropriate; and
(vii) 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; and
(iv) The date of publication.
(j)
(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.
(2) A request for waiver must be accompanied by appropriate documentation. The individual will be required to furnish any additional documentation or explanation deemed necessary by the Director of Practice. Examples of appropriate documentation could be a medical certificate, military orders, etc.
(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 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 so notified and issued a card evidencing such renewal.
(6) Those who are granted waivers are required to file timely applications for renewal of enrollment.
(k)
(2) The Director of Practice may require any individual, by first class mail to his/her last known mailing 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 concerned fails to comply with such 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 non-compliance 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 for a period of three years. During this time, the individual will be ineligible to practice before the Internal Revenue Service.
(4) During inactive enrollment status or at any other time an individual is ineligible to practice before the Internal Revenue Service, such individual shall not in any manner, directly or indirectly, indicate he or she is 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 satisfy the requirements for renewal of enrollment during his/her period of inactive enrollment. If such satisfaction includes completing the continuing education requirement, a minimum of 16 hours of qualifying continuing education hours must be completed in the 12 month period preceding the date on which the renewal application is filed. Continuing education credit under this subsection 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/her enrollment will terminate. Eligibility for enrollment must then be reestablished by the individual as provided in this part.
(7) Inactive enrollment status is not available to an individual who is the subject of a discipline matter in the Office of Director of Practice.
(l)
(m)
(n)
(a)
(b)
(c)
(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 trustee, receiver, guardian, personal representative, administrator, executor, or 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 before personnel of the Internal Revenue Service who are outside of the United States.
(viii) An individual who prepares and signs a taxpayer's return as the preparer, or who prepares a return but is not required (by the instructions to the return or regulations) to sign the return, may represent the taxpayer before officers and employees of the Examination Division of the Internal Revenue Service with respect to the tax liability of the taxpayer for the taxable year or period covered by that return.
(2)
(ii) The Director, after notice and opportunity for a conference, may deny eligibility to engage in limited practice before the Internal Revenue Service under § 10.7(c)(1) to any individual who has engaged in conduct that would justify suspending or disbarring a practitioner from practice before the Service.
(iii) An individual who represents a taxpayer under the authority of § 10.7(c)(1)(viii) is subject to such rules of general applicability regarding standards of conduct, the extent of his or her authority, and other matters as the Director prescribes.
(d)
(e)
Nothing contained in the regulations in this part shall be deemed to 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 is so licensed, at the office of the District Director of Internal Revenue 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 has acted as a customhouse broker.
(a)
(b)
Each attorney, certified public accountant, enrolled agent, or enrolled actuary 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 is required by the revenue laws of the United States to execute, shall advise the client promptly of the fact of such noncompliance, error, or omission.
Each attorney, certified public accountant, enrolled agent, or enrolled actuary shall exercise due diligence:
(a) In preparing or assisting in the preparation of, approving, and filing returns, documents, affidavits, and other papers relating to Internal Revenue Service matters;
(b) In determining the correctness of oral or written representations made by him to the Department of the Treasury; and
(c) In determining the correctness of oral or written representations made by him to clients with reference to any matter administered by the Internal Revenue Service.
No attorney, certified public accountant, enrolled agent, or enrolled actuary shall unreasonably delay the
No attorney, certified public accountant, enrolled agent, or enrolled actuary shall, in practice before the Internal Revenue Service, knowingly and directly or indirectly:
(a) Employ or accept assistance from any person who is under disbarment or suspension from practice before the Internal Revenue Service.
(b) Accept employment as associate, correspondent, or subagent from, or share fees with, any such person.
(c) Accept assistance from any former government employee where the provisions of § 10.26 of these regulations or any Federal law would be violated.
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, shall represent anyone in any matter administered by the Internal Revenue Service in which such officer or employee of the Government participates or has participated personally and substantially as a Government employee or which is the subject of his official responsibility.
(a)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(b)
(2) No former Government employee who participated in a transaction shall, subsequent to his Government employment, represent or knowingly assist, in that transaction, any person who is or was a specific party to that transaction.
(3) No former Government employee who within a period of one year prior to the termination of his Government employment had official responsibility for a transaction shall, within one year after his 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 shall, within one year after his 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 Government employment, he had official responsibility. However, this subparagraph does not preclude such former employee for appearing on his 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:
(c)
(i) No member of the firm who had knowledge of the participation by the Government employee in the transaction initiated discussions with the Government employee concerning his becoming a member of the firm until his Government employment is ended or six months after the termination of his participation in the transaction, whichever is earlier;
(ii) The former Government employee did not initiate any discussions concerning becoming a member of the firm while participating in the transaction or, if such discussions were intitiated, they conformed with the requirements of 18 U.S.C. 208(b); and
(iii) The firm isolates the former Government employee in such a way that he does not assist in the representation.
(2) 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)(3) of this section apply to the former employee, in that transaction unless the firm isolates the former Government employee in such a way that he does not assist in the representation.
(3) When isolation of the former Government employee is required under paragraph (c)(1) or (c)(2) of this section, a statement affirming the fact of such isolation shall be executed under oath by the former Government employee and by a member of the firm acting on behalf of the firm, and shall be filed with the Director of Practice and in such other place and in the manner prescribed by regulation. This statement shall clearly identify the firm, the former Government employee, and the transaction or transactions requiring such isolation.
(d)
No attorney, certified public accountant, enrolled agent, or enrolled actuary as notary public shall with respect to any matter administered by the Internal Revenue Service take acknowledgments, administer oaths, certify papers, or perform any official act in connection with matters in which he is employed as counsel, attorney, or agent, or in which he may be in any way interested before the Internal Revenue Service (26 Op. Atty. Gen. 236).
(a)
(b)
No attorney, certified public accountant, enrolled agent, or enrolled actuary shall represent conflicting interests in his practice before the Internal Revenue Service, except by express consent of all directly interested parties after full disclosure has been made.
(a)
(2) No attorney, certified public accountant, enrolled agent, enrolled actuary, or other individual eligible to practice before the Internal Revenue Service shall make, directly or indirectly, an uninvited solicitation of employment in matters related to the Internal Revenue Service. Solicitation includes, but is not limited to, in-person contacts and telephone communications. This restriction does not apply to (i) Seeking new business from an existing or former client in a related matter; (ii) communications with family members; (iii) making the availability of professional services known to other practitioners, so long as the person or firm contacted is not a potential client; (iv) solicitation by mailings; or (v) non-coercive in-person solicitation by those eligible to practice before the Internal Revenue Service while acting as an employee, member, or officer of an exempt organization listed in sections 501(c)(3) or (4) of the
(b)
(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) Attorney, certified public accountant, enrolled agent, or enrolled actuary and other individuals eligible to practice before the Internal Revenue Service may also publish the availability of a written schedule of fees.
(3) Attorney, certified public accountant, enrolled agent, or enrolled actuary and other individuals eligible to practice before the Internal Revenue Service 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.
(c)
(d)
No attorney, certified public accountant, enrolled agent, or enrolled actuary who is an income tax return preparer shall endorse or otherwise negotiate any check made in respect of
Nothing in the regulations in this part shall be construed as authorizing persons not members of the bar to practice law.
(a)
(1)
(ii) A practitioner may not accept as true asserted facts pertaining to the tax shelter which he/she should not, based on his/her background and knowledge, reasonably believe to be true. However, a practitioner need not conduct an audit or independent verification of the asserted facts, or assume that a client's statement of the facts cannot be relied upon, unless he/she has reason to believe that any relevant facts asserted to him/her are untrue.
(iii) If the fair market value of property or the expected financial performance of an investment is relevant to the tax shelter, a practitioner may not accept an appraisal or financial projection as support for the matters claimed therein unless:
(A) The appraisal or financial projection makes sense on its face;
(B) The practitioner reasonably believes that the person making the appraisal or financial projection is competent to do so and is not of dubious reputation; and
(C) The appraisal is based on the definition of fair market value prescribed under the relevant Federal tax provisions.
(iv) If the fair market value of purchased property is to be established by reference to its stated purchase price, the practitioner must examine the terms and conditions upon which the property was (or is to be) purchased to determine whether the stated purchase price reasonably may be considered to be its fair market value.
(2)
(3)
(4)
(5)
(ii) A favorable overall evaluation may not be rendered unless it is based on a conclusion that substantially more than half of the material tax benefits, in terms of their financial impact on a typical investor, more likely than
(iii) If it is not possible to give an overall evaluation, or if the overall evaluation is that the material tax benefits in the aggregate will not be realized, the fact that the practitioner's opinion does not constitute a favorable overall evaluation, or that it is an unfavorable overall evaluation, must be clearly and prominently disclosed in the offering materials.
(iv) The following examples illustrate the principles of this paragraph:
A limited partnership acquires real property in a sale-leaseback transaction. The principal tax benefits offered to investing partners consist of depreciation and interest deductions. Lesser tax benefits are offered to investors by reason of several deductions under Internal Revenue Code section 162 (ordinary and necessary business expenses). If a practitioner concludes that it is more likely than not that the partnership will not be treated as the owner of the property for tax purposes (which is required to allow the interest and depreciation deductions), then he/she may not opine to the effect that it is more likely than not that the material tax benefits in the aggregate will be realized, regardless of whether favorable opinions may be given with respect to the deductions claimed under Code section 162.
A corporation electing under subchapter S of the Internal Revenue Code is formed to engage in research and development activities. The offering materials forecast that deductions for research and experimental expenditures equal to 75% of the total investment in the corporation will be available during the first two years of the corporation's operations, other expenses will account for another 15% of the total investment, and that little or no gross income will be received by the corporation during this period. The practitioner concludes that it is more likely than not that deductions for research and experimental expenditures will be allowable. The practitioner may render an opinion to the effect that based on this conclusion, it is more likely than not that the material tax benefits in the aggregate will be realized, regardless of whether he/she can opine that it is more likely than not that any of the other tax benefits will be achieved.
An investment program is established to acquire offsetting positions in commodities contracts. The objective of the program is to close the loss positions in year one and to close the profit positions in year two. The principal tax benefit offered by the program is a loss in the first year, coupled with the deferral of offsetting gain until the following year. The practitioner concludes that the losses will not be deductible in year one. Accordingly, he/she may not render an opinion to the effect that it is more likely than not that the material tax benefits in the aggregate will be realized, regardless of the fact that he/she is of the opinion that losses not allowable in year one will be allowable in year two, because the principal tax benefit offered is a one-year deferral of income.
A limited partnership is formed to acquire, own and operate residential rental real estate. The offering material forecasts gross income of $2,000,000 and total deductions of $10,000,000, resulting in net losses of $8,000,000 over the first six taxable years. Of the total deductions, depreciation and interest are projected to be $7,000,000, and other deductions $3,000,000. The practitioner concludes that it is more likely than not that all of the depreciation and interest deductions will be allowable, and that it is more likely than not that the other deductions will not be allowed. The practitioner may render an opinion to the efect that it is more likely than not that the material tax benefits in the aggregate will be realized.
(6)
(b)
(i) At least one other competent practitioner provides an opinion on the likely outcome with respect to all of the other material tax issues which involve a reasonable possibility of challenge by the Internal Revenue Service, and an overall evalution whether the material tax benefits in the aggregate more likely than not will be realized, which is disseminated in the same manner as the practitioner's opinion; and
(ii) The practitioner, upon reviewing such other opinions and any offering materials, has no reason to believe that the standards of paragraph (a) of this section have not been complied with.
(2)
(c)
(1)
(2) A
(i) Deductions in excess of income from the investment being available in any year to reduce income from other sources in that year, or
(ii) Credits in excess of the tax attributable to the income from the investment being available in any year to offset taxes on income from other sources in that year. Excluded from the term are municipal bonds; annuities; family trusts (but not including schemes or arrangements that are marketed to the public other than in a direct practitioner-client relationship); qualified retirement plans; individual retirement accounts; stock option plans; securities issued in a corporate reorganization; mineral development ventures, if the only tax benefit would be percentage depletion; and real estate where it is anticipated that in no year is it likely that deductions will exceed gross income from the investment in that year, or that tax credits will exceed the tax attributable to gross income from the investment in that year. Whether an investment is intended to have tax shelter features depends on the objective facts and circumstances of each case. Significant weight will be given to the features described in the offering materials to determine whether the investment is a tax shelter.
(3) A
(4) A
(i) Any Federal income or excise tax issue relating to a tax shelter that would make a significant contribution toward sheltering from Federal taxes income from other sources by providing deductions in excess of the income from the tax shelter investment in any year, or tax credits available to offset
(ii) Any other Federal income or excise tax issue relating to a tax shelter that could have a significant impact (either benefical or adverse) on a tax shelter investor under any reasonably foreseeable circumstances (e.g., depreciation or investment tax credit recapture, availability of long-term capital gain treatment, or realization of taxable income in excess of cash flow, upon sale or other disposition of the tax shelter investment); and
(iii) The potential applicability of penalties, additions to tax, or interest charges that reasonably could be asserted against a tax shelter investor by the Internal Revenue Service with respect to the tax shelter. The determination of what is material is to be made in good faith by the practitioner, based on information available at the time the offering materials are circulated.
(d) For purposes of advising the Director of Practice whether an individual may have violated § 10.33, the Director of Practice is authorized to establish an Advisory Committee, composed of at least five individuals authorized to practice before the Internal Revenue Service. Under procedures established by the Director of Practice, such Advisory Committee shall, at the request of the Director of Practice, review and make recommendations with regard to alleged violations of § 10.33.
(a)
(i) The practitioner determines that the position satisfies the realistic possibility standard; or
(ii) 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 of 1986 by adequately disclosing the position and of the requirements for adequate disclosure.
(2)
(3)
(4)
(i)
(ii)
(b)
Pursuant to 31 U.S.C. 330(b), the Secretary of the Treasury after notice and an opportunity for a proceeding, may suspend or disbar any practitioner from practice before the Internal Revenue Service. The Secretary may take such action against any practitioner who is shown to be incompetent or disreputable, who refuses to comply with any regulation in this part, or who, with intent to defraud, willfully and knowingly misleads or threatens a client or prospective client.
Disreputable conduct for which an attorney, certified public accountant, enrolled agent, or enrolled actuary may be disbarred or suspended 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, or of 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 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.”
(c) Solicitation of employment as prohibited under § 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.
(d) Willfully failing to make 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 another 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 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.
(g) Disbarment or suspension from practice as an attorney, certified public accountant, public accountant, or actuary by any duly constituted authority of any State, possession, territory, Commonwealth, the District of Columbia, any Federal court of record or any Federal agency, body or board.
(h) Knowingly aiding and abetting another person to practice before the
(i) 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.
(j) Giving a false opinion, knowingly, recklessly, or through gross incompetence, including an opinion which is intentionally or recklessly misleading, or a pattern of providing incompetent opinions on questions arising under the Federal tax laws. False opinions described in this paragraph 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 existing law; from counseling or assisting in conduct known to be illegal or fraudulent; from concealment of matters required by law to be revealed; or from conscious disregard of information indicating that material facts expressed in the tax opinion or offering material are false or misleading. For purposes of this paragraph, 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.
A practitioner may be disbarred or suspended from practice before the Internal Revenue Service for any of the following:
(a) Willfully violating any of the regulations contained in this part.
(b) Recklessly or through gross incompetence (within the meaning of § 10.51(j)) violating § 10.33 or § 10.34 of this part.
If an officer or employee of the Internal Revenue Service has reason to believe that an attorney, certified public accountant, enrolled agent, or enrolled actuary has violated any provision of this part, or if any such officer or employee receives information to that effect, he shall promptly make a written report thereof, which report or a copy thereof shall be forwarded to the Director of Practice. If any other person has information of such violations, he may make a report thereof to the Director of Practice or to any officer or employee of the Internal Revenue Service.
Whenever the Director of Practice has reason to believe that any attorney, certified public accountant, enrolled agent, or enrolled actuary has
(a)
(b)
(a)
(b)
(a)
(b)
(c)
(a)
(b)
(c)
If it appears that the respondent in his 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 in fact possesses such information, or if it appears that the respondent has knowingly introduced false testimony during proceedings for his disbarment or suspension, the Director of Practice may thereupon file supplemental charges against the respondent. Such supplemental charges may be tried with other charges in the case, provided the respondent is given due notice thereof and is afforded an opportunity to prepare a defense thereto.
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 of Practice may file a reply in his discretion or at the request of the Administrative Law Judge.
In the case of a variance between the allegations in a pleading and the evidence adduced in support of the pleading, the Examiner may order or authorize amendment of the pleading to conform to the evidence:
Motions and requests may be filed with the Director of Practice or with the Administrative Law Judge.
A respondent or proposed respondent may appear in person or he may be represented by counsel or other representative who need not be enrolled to practice before the Internal Revenue Service. The Director may be represented by an attorney or other employee of the Internal Revenue Service.
(a)
(b)
(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) Perform such acts and take such measures as are necessary or appropriate to the efficient conduct of any proceeding; and
(10) Make initial decisions.
(a)
(b)
(a)
(b)
(c)
(d)
(e)
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 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 Internal Revenue Service who is authorized to administer an oath in internal revenue matters. 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.
In cases where the hearing is stenographically reported by a Government contract reported, 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 thereof 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 or 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)).
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 decision, shall afford the parties a reasonable opportunity to submit proposed findings and conclusions and supporting reasons therefor.
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
Within 30 days from the date of the Administrative Law Judge's decision, either party may appeal to the Secretary of the Treasury. The appeal shall be filed with the Director of Practice 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 of Practice, he 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 of Practice. If the reply brief is filed by the Director, he 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 of the Treasury.
On appeal from or review of the initial decision of the Administrative Law Judge, the Secretary of the Treasury will make the agency decision. In making his decision the Secretary of the Treasury 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 Secretary's decision shall be transmitted to the respondent by the Director of Practice.
In case the final order against the respondent is for disbarment, the respondent shall not thereafter be permitted to practice before the Internal Revenue Service unless and until authorized to do so by the Director of Practice pursuant to § 10.75. In case the final order against the respondent is for suspension, the respondent shall not thereafter be permitted to practice before the Internal Revenue Service during the period of suspension. If an enrolled agent is disbarred or suspended, he shall surrender his enrollment card to the Director of Practice for cancellation, in the case of disbarment, or for retention during the period of suspension.
Upon the issuance of a final order disbarring or suspending an attorney, certified public accountant, or enrolled agent, the Director of Practice shall give notice thereof to appropriate officers and employees of the Internal Revenue Service and to interested departments and agencies of the Federal Government. Notice in such manner as the Director of Practice may determine may be given to the proper authorities of the State by which the disbarred or suspended person was licensed to practice as an attorney or accountant.
The Director of Practice may entertain a petition for reinstatement from any person disbarred from practice before the Internal Revenue Service after the expiration of 5 years following such disbarment. 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
(a)
(b)
(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 § 10.51(g); or
(2) Has been convicted of any crime under title 26 of the United States Code, or a felony under title 18 of the United States Code involving dishonesty or breach of trust.
(c)
(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 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 by which an answer must be filed or, if a conference is requested, immediately following the conference.
(d)
(e)
(f)
(1) The Director lifts the suspension after determining that the practitioner is no longer described in 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 § 10.54.
(g)
(a)
(b)
(1) Appraisals by such appraiser shall not have any probative effect in any administrative proceeding before the Department of the Treasury or the Internal Revenue Service; and
(2) Such appraiser shall be barred from presenting evidence or testimony in any such administrative proceeding. Paragraph (b)(1) of this section shall apply to appraisals made by such appraiser after the effective date of disqualification, but shall not apply to appraisals made by the appraiser on or before such date. Notwithstanding the foregoing sentence, an appraisal otherwise barred from admission into evidence pursuant to paragraph (b)(1) of this section may be admitted into evidence solely for the purpose of determining the taxpayer's reliance in good faith on such appraisal. Paragraph (b)(2) of this section shall apply to the presentation of testimony or evidence in any administrative proceeding after the date of such disqualification, regardless of whether such testimony or evidence would pertain to an appraisal made prior to such date.
(a)
(b)
(a)
(b)
(a)
(b)
(c)
(a)
(b)
(c)
If it appears that the respondent in his/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/she in fact possesses such information, or if it appears that the respondent has knowingly introduced false testimony during proceedings for his/her disqualification, the Director of Practice may thereupon file supplemental charges against the respondent. Such supplemental charges may be tried with other charges in the case, provided the respondent is given due notice thereof and is afforded an opportunity to prepare a defense thereto.
No reply to the respondent's answer shall be required, and any new matter in the answer shall be deemed to be denied, but the Director of Practice may file a reply in his/her discretion or at
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.
Motions and requests may be filed with the Director of Practice or with the Administrative Law Judge.
A respondent may appear in person or may be represented by counsel or other representative. The Director of Practice may be represented by an attorney or other employee of the Department of the Treasury.
(a)
(b)
(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) Perform such acts and take such measures as are necessary or appropriate to the efficient conduct of any proceeding; and
(10) Make initial decisions.
(a)
(b)
(a)
(b)
(c)
(d)
(e)
Depositions for use at a hearing may, with the written approval of the Administrative Law Judge, be taken either by the Director of Practice 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 Internal Revenue Service who is authorized to administer an oath in internal revenue matters. 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.
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 a hearing is stenographically reported by a regular employee of the Internal Revenue Service, a copy thereof 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)).
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 a decision, shall afford the parties a reasonable opportunity to submit proposed findings and conclusions and supporting reasons therefor.
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 disqualification 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 thereof to the respondent or his attorney of record. In the absence of an appeal to the Secretary of the Treasury, or review of the decision upon motion of the Secretary, the decision of the Administrative Law
Within 30 days from the date of the Administrative Law Judge's decision, either party may appeal such decision to the Secretary of the Treasury. If an appeal is by the respondent, the appeal shall be filed with the Director of Practice 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 of Practice, a copy thereof shall be transmitted 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, a copy shall be transmitted 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 of the Treasury.
On appeal from or review of the initial decision of the Administrative Law Judge, the Secretary of the Treasury shall make the agency decision. In making such decision, the Secretary of the Treasury will review the record or such portions thereof as may be cited by the parties. A copy of the Secretary's decision shall be transmitted to the respondent by the Director of Practice.
Upon the issuance of a final order disqualifying an appraiser, the Director of Practice shall give notice thereof 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 entertain a petition for reinstatement from any disqualified appraiser after the expiration of 5 years following such disqualification. Reinstatement may not be granted unless the Director of Practice is satisfied that the petitioner, thereafter, is not likely to conduct himself/herself contrary to 26 U.S.C. 6701(a), and that granting such reinstatement would not be contrary to the public interest.
(a)
(b)
Any proceeding for the disbarment or suspension of an attorney, certified public accountant, or enrolled agent, instituted but not closed prior to the effective date of these revised regulations, shall not be affected by such regulations. Any proceeding under this part based on conduct engaged in prior to the effective date of these regulations may be instituted subsequent to such effective date.
The Secretary of the Treasury reserves the power to issue such special orders as he may deem proper in any cases within the purview of this part.
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).
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.
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
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)
(b) The term
(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.
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.
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 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.
(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.
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.
Sec. 636, Pub. L. 104-52, 109 Stat. 507.
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.
As used in this part—
(1) The term
(2) The term
(3) The term
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 § 12.5 of this part.
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 § 12.5 of this part.
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.
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.
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).
As used in this part, these terms shall have the following meaning:
(a) The term
(b) The term
(c) The term
(d) The term
(e) The term
(f) The term
(g) The term
(h) The term
(i) The term
(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 §§ 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 § 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 §§ 13.3(b)(3) (i) and (ii) whether or not associated with a visit by a foreign dignitary.
(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
(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 §§ 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 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 § 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 §§ 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.
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
(a) State and local governments providing services, personnel, equipment, or facilities to the affected metropolitan area pursuant to § 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 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.
(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 §§ 13.4 and 13.5 have not been complied with fully. In such circumstances the provisions of § 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 § 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.
(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.
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 —————— 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 § 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 § 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.
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 § 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).
Sec. 1108, Right to Financial Privacy Act of 1978, 92 Stat. 3697
For purposes of this regulation, the term:
(a)
(b)
(c)
(d)
(e)
(f)
(g)
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.
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 § 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))
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.
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 that the Departmental unit has complied with the applicable provisions of the Act.
92 Stat. 1864 (18 U.S.C. 207), as amended.
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.
For the purpose of this part—(a) The term
(b) The term
(c) The term
(d) The term
(e) The term
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.
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.
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.
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.
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.
The General Counsel may issue special orders as he/she may consider proper in any case within the purview of this part.
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
(a)
(b)
(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 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.
(a)
(b)
(a)
(b)
(c)
(a)
(b)
(c)
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.
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:
Motions and requests may be filed with the Director or with the Administrative Law Judge.
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.
(a)
(b)
(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.
(a)
(b)
(c)
(a)
(b)
(c)
(d)
(e)
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
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 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)).
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.
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.
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.
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.
(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.
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 the General Counsel, who will make the agency decision on the issue.
31 U.S.C. 3801-3812.
(a)
(b)
(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.
(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—
(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.
(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.
(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.
(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 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.
(a)
(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)
(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,
(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
(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;
(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.
(a) If an investigating official concludes that a subpoena pursuant to the
(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.
(a) If, based on the report of the investigating official under § 16.4(b), the reviewing official determines that there is adequate evidence to believe that a person is liable under § 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 § 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 § 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.
(a) The reviewing official may issue a complaint under § 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 § 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 § 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
(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.
(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 § 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.
(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.
(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.
(a) If the defendant does not file an answer within the time prescribed in § 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 § 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 § 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
(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 § 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 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.
Upon receipt of an answer, the reviewing official shall file the complaint and answer with the ALJ.
(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 § 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.
(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.
(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.
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.
(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 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.
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.
(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.
(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;
(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.
(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 § 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 § 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 § 16.9.
(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 §§ 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)
(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 § 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 § 16.24.
(e)
(2) The party seeking to depose shall serve the subpoena in the manner prescribed in § 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.
(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 § 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.
(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
(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 § 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.
(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;
(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.
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.
(a)
(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 (
(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)
(c)
(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.
(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 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.
(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.
(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 § 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
(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.
(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;
(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.
(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.
(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 § 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 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.
(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,
(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 § 16.24.
(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 § 16.24.
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.
(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 § 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 § 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 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.
(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 § 16.38, and for finality of the initial decision in § 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.
(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 § 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
(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, 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 § 16.3 is final and is not subject to judicial review.
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.
(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.
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.
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.
The amount of any penalty or assessment which has become final, or for which a judgment has been entered under § 16.42 or § 16.43, or any amount agreed upon in a compromise or settlement under § 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
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).
(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 § 16.42 or during the pendency of any action to collect penalties and assessments under § 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 § 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 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.
(a) The notice of hearing with respect to a claim or statement must be served in the manner specified in § 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 § 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.
29 U.S.C. 794.
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.
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.
For purposes of this part, the term—
(a)
(b)
(c)
(d)
(e)
(f)
(2)
(3)
(4)
(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)
(2) With respect to any other program or activity, an individual with
(3) For purposes of employment, “qualified handicapped person” is defined in 29 CFR 1613.702(f), which is made applicable to this part by § 17.140.
(h)
(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: (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.
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.
(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,
(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.
(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.
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.
Except as otherwise provided in § 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.
(a)
(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
(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 § 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)
(c)
(d)
(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.
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-
(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.
(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 § 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.
(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
(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
(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 § 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. 8021, Omnibus Budget Reconciliation Act of 1986, Pub. L. 99-509, 100 Stat. 1874.
(a)
(b)
(c)
(i) The numerator of which is 100 percent, and
(ii) The denominator of which is a percentage equal to the ratio that the value of the Conrail common stock sold in the public sale bears to the value of such stock plus the value of the qualified minority stock. For purposes of this paragraph (c)(1)(ii), each share of Conrail common stock shall be deemed to have the same value.
(2)
(A) Any Conrail common stock that Conrail is obligated under section 4024(f)(1) and (3) of the Act to contribute to the ESOP, or to distribute to persons who are or were ESOP participants, as of the purchase date, and
(B) Any common stock that may be held by the Conrail Equity Corporation as of the purchase date.
(ii)
(3)
(i)
(ii)
(iii)
(4)
(d)
(2)
(i)
(A) Accounts receivable and materials and supplies owned by new Conrail shall be deemed to be Class I assets and the amount of the deemed purchase price allocable to those assets shall be their respective book values, and
(B) Commercial paper and repurchase agreements (within the meaning of section 1058(b)) shall be deemed to be Class II assets.
(ii)
(iii)
(iv)
(v)
(e)
(f)
(1)
(2)
(i)
(ii)
(3)
(4)
(5)
(6)
(7)
E.O. 12549; sec. 5151-5160 of the Drug-Free Workplace Act of 1988 (Pub. L. 100-690, Title V, Subtitle D; 41 U.S.C. 701
See also Office of Management and Budget notice published at 55 FR 21679, May 25, 1990, and 60 FR 33036, June 26, 1995.
(a) Executive Order (E.O.) 12549 provides that, to the extent permitted by law, Executive departments and agencies shall participate in a governmentwide system for nonprocurement debarment and suspension. A person who is debarred or suspended shall be excluded from Federal financial and nonfinancial assistance and benefits under Federal programs and activities. Debarment or suspension of a participant in a program by one agency shall have governmentwide effect.
(b) These regulations implement section 3 of E.O. 12549 and the guidelines promulgated by the Office of Management and Budget under section 6 of the E.O. by:
(1) Prescribing the programs and activities that are covered by the governmentwide system;
(2) Prescribing the governmentwide criteria and governmentwide minimum due process procedures that each agency shall use;
(3) Providing for the listing of debarred and suspended participants, participants declared ineligible (see definition of “ineligible” in § 19.105), and participants who have voluntarily excluded themselves from participation in covered transactions;
(4) Setting forth the consequences of a debarment, suspension, determination of ineligibility, or voluntary exclusion; and
(5) Offering such other guidance as necessary for the effective implementation and administration of the governmentwide system.
(c) These regulations also implement Executive Order 12689 (3 CFR, 1989 Comp., p. 235) and 31 U.S.C. 6101 note (Public Law 103-355, sec. 2455, 108 Stat. 3327) by—
(1) Providing for the inclusion in the
(2) Setting forth the consequences of a debarment, suspension, determination of ineligibility, or voluntary exclusion.
(d) Although these regulations cover the listing of ineligible participants and the effect of such listing, they do not prescribe policies and procedures governing declarations of ineligibility.
The following definitions apply to this part:
(1) The agency head, or
(2) An official designated by the agency head.
(1) Principal investigators.
(2) [Reserved]
(1) The agency head, or
(2) An official designated by the agency head.
(a) These regulations apply to all persons who have participated, are currently participating or may reasonably be expected to participate in transactions under Federal nonprocurement programs. For purposes of these regulations such transactions will be referred to as “covered transactions.”
(1)
(i)
(ii)
(A) Any transaction between a participant and a person other than a procurement contract for goods or services, regardless of type, under a primary covered transaction.
(B) Any procurement contract for goods or services between a participant and a person, regardless of type, expected to equal or exceed the Federal procurement small purchase threshold fixed at 10 U.S.C. 2304(g) and 41 U.S.C. 253(g) (currently $25,000) under a primary covered transaction.
(C) Any procurement contract for goods or services between a participant and a person under a covered transaction, regardless of amount, under which that person will have a critical influence on or substantive control over that covered transaction. Such persons are:
(
(
(2)
(i) Statutory entitlements or mandatory awards (but not subtier awards thereunder which are not themselves mandatory), including deposited funds insured by the Federal Government;
(ii) Direct awards to foreign governments or public international organizations, or transactions with foreign governments or foreign governmental entities, public international organizations, foreign government owned (in whole or in part) or controlled entities, entities consisting wholly or partially of foreign governments or foreign governmental entities;
(iii) Benefits 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);
(iv) Federal employment;
(v) Transactions pursuant to national or agency-recognized emergencies or disasters;
(vi) Incidental benefits derived from ordinary governmental operations; and
(vii) Other transactions where the application of these regulations would be prohibited by law.
(b)
(c)
(a) In order to protect the public interest, it is the policy of the Federal Government to conduct business only with responsible persons. Debarment and suspension are discretionary actions that, taken in accordance with Executive Order 12549 and these regulations, are appropriate means to implement this policy.
(b) Debarment and suspension are serious actions which shall be used only in the public interest and for the Federal Government's protection and not for purposes of punishment. Agencies may impose debarment or suspension for the causes and in accordance with the procedures set forth in these regulations.
(c) When more than one agency has an interest in the proposed debarment or suspension of a person, consideration shall be given to designating one agency as the lead agency for making the decision. Agencies are encouraged to establish methods and procedures for coordinating their debarment or suspension actions.
(a)
(b)
(c)
(1) Statutory entitlements or mandatory awards (but not subtier awards thereunder which are not themselves mandatory), including deposited funds insured by the Federal Government;
(2) Direct awards to foreign governments or public international organizations, or transactions with foreign governments or foreign governmental entities, public international organizations, foreign government owned (in whole or in part) or controlled entities, and entities consisting wholly or partially of foreign governments or foreign governmental entities;
(3) Benefits 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);
(4) Federal employment;
(5) Transactions pursuant to national or agency-recognized emergencies or disasters;
(6) Incidental benefits derived from ordinary governmental operations; and
(7) Other transactions where the application of these regulations would be prohibited by law.
Persons who are ineligible, as defined in § 19.105(i), are excluded in accordance with the applicable statutory, executive order, or regulatory authority.
Persons who accept voluntary exclusions under § 19.315 are excluded in accordance with the terms of their settlements. Department of the Treasury shall, and participants may, contact the original action agency to ascertain the extent of the exclusion.
The Department of the Treasury may grant an exception permitting a debarred, suspended, or voluntarily excluded person, or a person proposed for debarment under 48 CFR part 9, subpart 9.4, to participate in a particular covered transaction upon a written determination by the agency head or an authorized designee stating the reason(s) for deviating from the Presidential policy established by Executive Order 12549 and § 19.200. However, in accordance with the President's stated intention in the Executive Order, exceptions shall be granted only infrequently. Exceptions shall be reported in accordance with § 19.505(a).
(a) Notwithstanding the debarment, suspension, proposed debarment under 48 CFR part 9, subpart 9.4, determination of ineligibility, or voluntary exclusion of any person by an agency, agencies and participants may continue covered transactions in existence at the time the person was debarred, suspended, proposed for debarment under 48 CFR part 9, subpart 9.4, declared ineligible, or voluntarily excluded. A decision as to the type of termination action, if any, to be taken should be made only after thorough review to ensure the propriety of the proposed action.
(b) Agencies and participants shall not renew or extend covered transactions (other than no-cost time extensions) with any person who is debarred, suspended, proposed for debarment under 48 CFR part 9, subpart 9.4, ineligible or voluntary excluded, except as provided in § 19.215.
(a) Except as permitted under § 19.215 or § 19.220, a participant shall not knowingly do business under a covered transaction with a person who is—
(1) Debarred or suspended;
(2) Proposed for debarment under 48 CFR part 9, subpart 9.4; or
(3) Ineligible for or voluntarily excluded from the covered transaction.
(b) Violation of the restriction under paragraph (a) of this section may result in disallowance of costs, annulment or termination of award, issuance of a stop work order, debarment or suspension, or other remedies as appropriate.
(c) A participant may rely upon the certification of a prospective participant in a lower tier covered transaction that it and its principals are not debarred, suspended, proposed for debarment under 48 CFR part 9, subpart 9.4, ineligible, or voluntarily excluded from the covered transaction (See Appendix B of these regulations), unless it knows that the certification is erroneous. An agency has the burden of proof that a participant did knowingly do business with a person that filed an erroneous certification.
The debarring official may debar a person for any of the causes in § 19.305, using procedures established in §§ 19.310 through 19.314. The existence of a cause for debarment, however, does not necessarily require that the person be debarred; the seriousness of the person's acts or omissions and any mitigating factors shall be considered in making any debarment decision.
Debarment may be imposed in accordance with the provisions of §§ 19.300 through 19.314 for:
(a) Conviction of or civil judgment for:
(1) Commission of fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a public or private agreement or transaction;
(2) Violation of Federal or State antitrust statutes, including those proscribing price fixing between competitors, allocation of customers between competitors, and bid rigging;
(3) Commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, receiving stolen property, making false claims, or obstruction of justice; or
(4) Commission of any other offense indicating a lack of business integrity or business honesty that seriously and directly affects the present responsibility of a person.
(b) Violation of the terms of a public agreement or transaction so serious as to affect the integrity of an agency program, such as:
(1) A willful failure to perform in accordance with the terms of one or more public agreements or transactions;
(2) A history of failure to perform or of unsatisfactory performance of one or more public agreements or transactions; or
(3) A willful violation of a statutory or regulatory provision or requirement applicable to a public agreement or transaction.
(c) Any of the following causes:
(1) A nonprocurement debarment by any Federal agency taken before October 1, 1988, the effective date of these regulations, or a procurement debarment by any Federal agency taken pursuant to 48 CFR subpart 9.4;
(2) Knowingly doing business with a debarred, suspended, ineligible, or voluntarily excluded person, in connection with a covered transaction, except as permitted in § 19.215 or § 19.220;
(3) Failure to pay a single substantial debt, or a number of outstanding debts (including disallowed costs and overpayments, but not including sums owed the Federal Government under the Internal Revenue Code) owed to any Federal agency or instrumentality, provided the debt is uncontested by the debtor or, if contested, provided that the debtor's legal and administrative remedies have been exhausted;
(4) Violation of a material provision of a voluntary exclusion agreement entered into under § 19.315 or of any settlement of a debarment or suspension action; or
(5) Violation of any requirement of subpart F of this part, relating to providing a drug-free workplace, as set forth in § 19.615 of this part.
(d) Any other cause of so serious or compelling a nature that it affects the present responsibility of a person.
Department of the Treasury shall process debarment actions as informally as practicable, consistent with the principles of fundamental fairness, using the procedures in §§ 19.311 through 19.314.
Information concerning the existence of a cause for debarment from any source shall be promptly reported, investigated, and referred, when appropriate, to the debarring official for consideration. After consideration, the debarring official may issue a notice of proposed debarment.
A debarment proceeding shall be initiated by notice to the respondent advising:
(a) That debarment is being considered;
(b) Of the reasons for the proposed debarment in terms sufficient to put the respondent on notice of the conduct or transaction(s) upon which it is based;
(c) Of the cause(s) relied upon under § 19.305 for proposing debarment;
(d) Of the provisions of § 19.311 through § 19.314, and any other Department of the Treasury procedures, if applicable, governing debarment decisionmaking; and
(e) Of the potential effect of a debarment.
(a)
(b)
(2) A transcribed record of any additional proceedings shall be made available at cost to the respondent, upon request, unless the respondent and the agency, by mutual agreement, waive the requirement for a transcript.
(a)
(b)
(2) The debarring official may refer disputed material facts to another official for findings of fact. The debarring official may reject any such findings, in whole or in part, only after specifically determining them to be arbitrary and capricious or clearly erroneous.
(3) The debarring official's decision shall be made after the conclusion of the proceedings with respect to disputed facts.
(c) (1)
(2)
(d)
(i) Referring to the notice of proposed debarment;
(ii) Specifying the reasons for debarment;
(iii) Stating the period of debarment, including effective dates; and
(iv) Advising that the debarment is effective for covered transactions throughout the executive branch of the Federal Government unless an agency head or an authorized designee makes the determination referred to in § 601.915.
(2) If the debarring official decides not to impose debarment, the respondent shall be given prompt notice of that decision. A decision not to impose debarment shall be without prejudice to a subsequent imposition of debarment by any other agency.
(a) When in the best interest of the Government, Department of the Treasury may, at any time, settle a debarment or suspension action.
(b) If a participant and the agency agree to a voluntary exclusion of the participant, such voluntary exclusion shall be entered on the Nonprocurement List (see subpart E).
(a) Debarment shall be for a period commensurate with the seriousness of the cause(s). If a suspension precedes a debarment, the suspension period shall
(1) Debarment for causes other than those related to a violation of the requirements of subpart F of this part generally should not exceed three years. Where circumstances warrant, a longer period of debarment may be imposed.
(2) In the case of a debarment for a violation of the requirements of subpart F of this part (
(b) The debarring official may extend an existing debarment for an additional period, if that official determines that an extension is necessary to protect the public interest. However, a debarment may not be extended solely on the basis of the facts and circumstances upon which the initial debarment action was based. If debarment for an additional period is determined to be necessary, the procedures of §§ 19.311 through 19.314 shall be followed to extend the debarment.
(c) The respondent may request the debarring official to reverse the debarment decision or to reduce the period or scope of debarment. Such a request shall be in writing and supported by documentation. The debarring official may grant such a request for reasons including, but not limited to:
(1) Newly discovered material evidence;
(2) Reversal of the conviction or civil judgment upon which the debarment was based;
(3) Bona fide change in ownership or management;
(4) Elimination of other causes for which the debarment was imposed; or
(5) Other reasons the debarring official deems appropriate.
(a)
(2) The debarment action may include any affiliate of the participant that is specifically named and given notice of the proposed debarment and an opportunity to respond (see §§ 19.311 through 19.314).
(b)
(1)
(2)
(3)
(a) The suspending official may suspend a person for any of the causes in § 19.405 using procedures established in §§ 19.410 through 19.413.
(b) Suspension is a serious action to be imposed only when:
(1) There exists adequate evidence of one or more of the causes set out in § 19.405, and
(2) Immediate action is necessary to protect the public interest.
(c) In assessing the adequacy of the evidence, the agency should consider 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. This assessment should include an examination of basic documents such as grants, cooperative agreements, loan authorizations, and contracts.
(a) Suspension may be imposed in accordance with the provisions of §§ 19.400 through 19.413 upon adequate evidence:
(1) To suspect the commission of an offense listed in § 19.405(a); or
(2) That a cause for debarment under § 19.305 may exist.
(b) Indictment shall constitute adequate evidence for purposes of suspension actions.
(a)
(b)
When a respondent is suspended, notice shall immediately be given:
(a) That suspension has been imposed;
(b) That the suspension is based on an indictment, conviction, or other adequate evidence that the respondent has committed irregularities seriously reflecting on the propriety of further Federal Government dealings with the respondent;
(c) Describing any such irregularities in terms sufficient to put the respondent on notice without disclosing the Federal Government's evidence;
(d) Of the cause(s) relied upon under § 19.405 for imposing suspension;
(e) That the suspension is for a temporary period pending the completion of an investigation or ensuing legal, debarment, or Program Fraud Civil Remedies Act proceedings;
(f) Of the provisions of § 19.411 through § 19.413 and any other Department of the Treasury procedures, if applicable, governing suspension decisionmaking; and
(g) Of the effect of the suspension.
(a)
(b)
(i) The action is based on an indictment, conviction or civil judgment, or
(ii) A determination is made, on the basis of Department of Justice advice, that the substantial interests of the Federal Government in pending or contemplated legal proceedings based on the same facts as the suspension would be prejudiced.
(2) A transcribed record of any additional proceedings shall be prepared
The suspending official may modify or terminate the suspension (for example, see § 19.320(c) for reasons for reducing the period or scope of debarment) or may leave it in force. However, a decision to modify or terminate the suspension shall be without prejudice to the subsequent imposition of suspension by any other agency or debarment by any agency. The decision shall be rendered in accordance with the following provisions:
(a)
(b)
(2) The suspending official may refer matters involving disputed material facts to another official for findings of fact. The suspending official may reject any such findings, in whole or in part, only after specifically determining them to be arbitrary or capricious or clearly erroneous.
(c)
(a) Suspension shall be for a temporary period pending the completion of an investigation or ensuing legal, debarment, or Program Fraud Civil Remedies Act proceedings, unless terminated sooner by the suspending official or as provided in paragraph (b) of this section.
(b) If legal or administrative proceedings are not initiated within 12 months after the date of the suspension notice, the suspension shall be terminated unless an Assistant Attorney General or United States Attorney requests its extension in writing, in which case it may be extended for an additional six months. In no event may a suspension extend beyond 18 months, unless such proceedings have been initiated within that period.
(c) The suspending official shall notify the Department of Justice of an impending termination of a suspension, at least 30 days before the 12-month period expires, to give that Department an opportunity to request an extension.
The scope of a suspension is the same as the scope of a debarment (see § 19.325), except that the procedures of §§ 19.410 through 19.413 shall be used in imposing a suspension.
(a) In accordance with the OMB guidelines, GSA shall compile, maintain, and distribute a list of all persons who have been debarred, suspended, or voluntarily excluded by agencies under Executive Order 12549 and these regulations, and those who have been determined to be ineligible.
(b) At a minimum, this list shall indicate:
(1) The names and addresses of all debarred, suspended, ineligible, and voluntarily excluded persons, in alphabetical order, with cross-references when 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 each listing; and
(6) The agency and name and telephone number of the agency point of contact for the action.
(a) The agency shall provide GSA with current information concerning debarments, suspension, determinations of ineligibility, and voluntary exclusions it has taken. Until February 18, 1989, the agency shall also provide GSA and OMB with information concerning all transactions in which Department of the Treasury has granted exceptions under § 19.215 permitting participation by debarred, suspended, or voluntarily excluded persons.
(b) Unless an alternative schedule is agreed to by GSA, the agency shall advise GSA of the information set forth in § 19.200(b) and of the exceptions granted under § 19.215 within five working days after taking such actions.
(c) The agency shall direct inquiries concerning listed persons to the agency that took the action.
(d) Agency officials shall check the Nonprocurement List before entering covered transactions to determine whether a participant in a primary transaction is debarred, suspended, ineligible, or voluntarily excluded (Tel. #).
(e) Agency officials shall check the Nonprocurement List before approving principals or lower tier participants where agency approval of the principal or lower tier participant is required under the terms of the transaction, to determine whether such principals or participants are debarred, suspended, ineligible, or voluntarily excluded.
(a)
(b)
(2) A participant may rely upon the certification of a prospective participant in a lower tier covered transaction that it and its principals are not debarred, suspended, ineligible, or voluntarily excluded from the covered transaction by any Federal agency, unless it knows that the certification is erroneous. Participants may decide the method and frequency by which they determine the eligiblity of their principals. In addition, a participant may, but is not required to, check the Nonprocurement List for its principals and for participants (Tel. #).
(c)
(a) The purpose of this subpart is to carry out the Drug-Free Workplace Act of 1988 by requiring that—
(1) A grantee, other than an individual, shall certify to the agency that it will provide a drug-free workplace;
(2) A grantee who is an individual shall certify to the agency that, as a condition of the grant, he or she will not engage in the unlawful manufacture, distribution, dispensing, possession or use of a controlled substance in conducting any activity with the grant.
(b) Requirements implementing the Drug-Free Workplace Act of 1988 for contractors with the agency are found at 48 CFR subparts 9.4, 23.5, and 52.2.
(a) Except as amended in this section, the definitions of § 19.105 apply to this subpart.
(b) For purposes of this subpart—
(1)
(2)
(3)
(4)
(5)
(i) All
(ii) All
(iii) Temporary personnel and consultants who are directly engaged in the performance of work under the grant and who are on the grantee's payroll.
(6)
(7)
(8)
(9)
(10)
(a) This subpart applies to any grantee of the agency.
(b) This subpart applies to any grant, except where application of this subpart would be inconsistent with the international obligations of the United States or the laws or regulations of a foreign government. A determination of such inconsistency may be made only by the agency head or his/her designee.
(c) The provisions of subparts A, B, C, D and E of this part apply to matters covered by this subpart, except where specifically modified by this subpart. In the event of any conflict between provisions of this subpart and other provisions of this part, the provisions of this subpart are deemed to control with respect to the implementation of drug-free workplace requirements concerning grants.
A grantee shall be deemed in violation of the requirements of this subpart if the agency head or his or her official designee determines, in writing, that—
(a) The grantee has made a false certification under § 19.630;
(b) With respect to a grantee other than an individual—
(1) The grantee has violated the certification by failing to carry out the requirements of paragraphs (A)(a) through (g) and/or (B) of the certification (Alternate I to Appendix C) or
(2) Such a number of employees of the grantee have been convicted of violations of criminal drug statutes for violations occurring in the workplace as to indicate that the grantee has failed to make a good faith effort to provide a drug-free workplace.
(c) With respect to a grantee who is an individual—
(1) The grantee has violated the certification by failing to carry out its requirements (Alternate II to Appendix C); or
(2) The grantee is convicted of a criminal drug offense resulting from a violation occurring during the conduct of any grant activity.
(a) In the event of a violation of this subpart as provided in § 19.615, and in accordance with applicable law, the grantee shall be subject to one or more of the following actions:
(1) Suspension of payments under the grant;
(2) Suspension or termination of the grant; and
(3) Suspension or debarment of the grantee under the provisions of this part.
(b) Upon issuance of any final decision under this part requiring debarment of a grantee, the debarred grantee shall be ineligible for award of any grant from any Federal agency for a period specified in the decision, not to exceed five years (
The agency head may waive with respect to a particular grant, in writing, a suspension of payments under a grant, suspension or termination of a grant, or suspension or debarment of a grantee if the agency head determines that such a waiver would be in the public interest. This exception authority cannot be delegated to any other official.
(a)(1) As a prior condition of being awarded a grant, each grantee shall make the appropriate certification to the Federal agency providing the grant, as provided in Appendix C to this part.
(2) Grantees are not required to make a certification in order to continue receiving funds under a grant awarded before March 18, 1989, or under a no-cost time extension of such a grant. However, the grantee shall make a one-time drug-free workplace certification for a non-automatic continuation of such a grant made on or after March 18, 1989.
(b) Except as provided in this section, all grantees shall make the required certification for each grant. For mandatory formula grants and entitlements that have no application process, grantees shall submit a one-time certification in order to continue receiving awards.
(c) A grantee that is a State may elect to make one certification in each Federal fiscal year. States that previously submitted an annual certification are not required to make a certification for Fiscal Year 1990 until June 30, 1990. Except as provided in paragraph (d) of this section, this certification shall cover all grants to all State agencies from any Federal agency. The State shall retain the original of this statewide certification in its Governor's office and, prior to grant award, shall ensure that a copy is submitted individually with respect to each grant, unless the Federal agency has designated a central location for submission.
(d)(1) The Governor of a State may exclude certain State agencies from the statewide certification and authorize these agencies to submit their own certifications to Federal agencies. The statewide certification shall name any State agencies so excluded.
(2) A State agency to which the statewide certification does not apply, or a State agency in a State that does not have a statewide certification, may elect to make one certification in each Federal fiscal year. State agencies that previously submitted a State agency certification are not required to make a certification for Fiscal Year 1990 until June 30, 1990. The State agency shall retain the original of this State agency-wide certification in its central office and, prior to grant award, shall ensure that a copy is submitted individually with respect to each grant, unless the Federal agency designates a central location for submission.
(3) When the work of a grant is done by more than one State agency, the certification of the State agency directly receiving the grant shall be deemed to certify compliance for all workplaces, including those located in other State agencies.
(e)(1) For a grant of less than 30 days performance duration, grantees shall have this policy statement and program in place as soon as possible, but in any case by a date prior to the date on which performance is expected to be completed.
(2) For a grant of 30 days or more performance duration, grantees shall have this policy statement and program in place within 30 days after award.
(3) Where extraordinary circumstances warrant for a specific grant, the grant officer may determine a different date on which the policy statement and program shall be in place.
(a) When a grantee other than an individual is notified that an employee has been convicted for a violation of a criminal drug statute occurring in the workplace, it shall take the following actions:
(1) Within 10 calendar days of receiving notice of the conviction, the grantee shall provide written notice, including the convicted employee's position title, to every grant officer, or other designee on whose grant activity the convicted employee was working, unless a Federal agency has designated a central point for the receipt of such notifications. Notification shall include the identification number(s) for each of the Federal agency's affected grants.
(2) Within 30 calendar days of receiving notice of the conviction, the grantee shall do the following with respect to the employee who was convicted.
(i) Take appropriate personnel action against the employee, up to and including termination, consistent with requirements of the Rehabilitation Act of 1973, as amended; or
(ii) Require the employee to participate satisfactorily in a drug abuse assistance or rehabilitation program approved for such purposes by a Federal, State, or local health, law enforcement, or other appropriate agency.
(b) A grantee who is an individual who is convicted for a violation of a criminal drug statute occurring during the conduct of any grant activity shall
1. By signing and submitting this proposal, the prospective primary participant is providing the certification set out below.
2. The inability of a person to provide the certification required below will not necessarily result in denial of participation in this covered transaction. The prospective participant shall submit an explanation of why it cannot provide the certification set out below. The certification or explanation will be considered in connection with the department or agency's determination whether to enter into this transaction. However, failure of the prospective primary participant to furnish a certification or an explanation shall disqualify such person from participation in this transaction.
3. The certification in this clause is a material representation of fact upon which reliance was placed when the department or agency determined to enter into this transaction. If it is later determined that the prospective primary participant knowingly rendered an erroneous certification, in addition to other remedies available to the Federal Government, the department or agency may terminate this transaction for cause or default.
4. The prospective primary participant shall provide immediate written notice to the department or agency to which this proposal is submitted if at any time the prospective primary participant learns that its certification was erroneous when submitted or has become erroneous by reason of changed circumstances.
5. The terms
6. The prospective primary participant agrees by submitting this proposal that, should the proposed covered transaction be entered into, it shall not knowingly enter into any lower tier covered transaction with a person who is proposed for debarment under 48 CFR part 9, subpart 9.4, debarred, suspended, declared ineligible, or voluntarily excluded from participation in this covered transaction, unless authorized by the department or agency entering into this transaction.
7. The prospective primary participant further agrees by submitting this proposal that it will include the clause titled “Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion-Lower Tier Covered Transaction,” provided by the department or agency entering into this covered transaction, without modification, in all lower tier covered transactions and in all solicitations for lower tier covered transactions.
8. A participant in a covered transaction may rely upon a certification of a prospective participant in a lower tier covered transaction that it is not proposed for debarment under 48 CFR part 9, subpart 9.4, debarred, suspended, ineligible, or voluntarily excluded from the covered transaction, unless it knows that the certification is erroneous. A participant may decide the method and frequency by which it determines the eligibility of its principals. Each participant may, but is not required to, check the List of Parties Excluded from Federal Procurement and Nonprocurement Programs.
9. Nothing contained in the foregoing shall be construed to require establishment of a system of records in order to render in good faith the certification required by this clause. The knowledge and information of a participant is not required to exceed that which is normally possessed by a prudent person in the ordinary course of business dealings.
10. Except for transactions authorized under paragraph 6 of these instructions, if a participant in a covered transaction knowingly enters into a lower tier covered transaction with a person who is proposed for debarment under 48 CFR part 9, subpart 9.4, suspended, debarred, ineligible, or voluntarily excluded from participation in this transaction, in addition to other remedies available to the Federal Government, the department or agency may terminate this transaction for cause or default.
(1) The prospective primary participant certifies to the best of its knowledge and belief, that it and its principals:
(a) Are not presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded by any Federal department or agency;
(b) Have not within a three-year period preceding this proposal been convicted of or had a civil judgment rendered against them for commission of fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a public (Federal, State or local) transaction or contract under a public transaction; violation of Federal or State antitrust statutes or commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, or receiving stolen property;
(c) Are not presently indicted for or otherwise criminally or civilly charged by a governmental entity (Federal, State or local) with commission of any of the offenses enumerated in paragraph (1)(b) of this certification; and
(d) Have not within a three-year period preceding this application/proposal had one or more public transactions (Federal, State or local) terminated for cause or default.
(2) Where the prospective primary participant is unable to certify to any of the statements in this certification, such prospective participant shall attach an explanation to this proposal.
1. By signing and submitting this proposal, the prospective lower tier participant is providing the certification set out below.
2. The certification in this clause is a material representation of fact upon which reliance was placed when this transaction was entered into. If it is later determined that the prospective lower tier participant knowingly rendered an erroneous certification, in addition to other remedies available to the Federal Government the department or agency with which this transaction originated may pursue available remedies, including suspension and/or debarment.
3. The prospective lower tier participant shall provide immediate written notice to the person to which this proposal is submitted if at any time the prospective lower tier participant learns that its certification was erroneous when submitted or had become erroneous by reason of changed circumstances.
4. The terms
5. The prospective lower tier participant agrees by submitting this proposal that, should the proposed covered transaction be entered into, it shall not knowingly enter into any lower tier covered transaction with a person who is proposed for debarment under 48 CFR part 9, subpart 9.4, debarred, suspended, declared ineligible, or voluntarily excluded from participation in this covered transaction, unless authorized by the department or agency with which this transaction originated.
6. The prospective lower tier participant further agrees by submitting this proposal that it will include this clause titled “Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion-Lower Tier Covered Transaction,” without modification, in all lower tier covered transactions and in all solicitations for lower tier covered transactions.
7. A participant in a covered transaction may rely upon a certification of a prospective participant in a lower tier covered transaction that it is not proposed for debarment under 48 CFR part 9, subpart 9.4, debarred, suspended, ineligible, or voluntarily excluded from covered transactions, unless it knows that the certification is erroneous. A participant may decide the method and frequency by which it determines the eligibility of its principals. Each participant may, but is not required to, check the List of Parties Excluded from Federal Procurement and Nonprocurement Programs.
8. Nothing contained in the foregoing shall be construed to require establishment of a system of records in order to render in good faith the certification required by this clause. The knowledge and information of a participant is not required to exceed that which is normally possessed by a prudent person in the ordinary course of business dealings.
9. Except for transactions authorized under paragraph 5 of these instructions, if a participant in a covered transaction knowingly enters into a lower tier covered transaction with a person who is proposed for debarment under 48 CFR part 9, subpart 9.4, suspended, debarred, ineligible, or voluntarily excluded from participation in this transaction, in addition to other remedies available to the
(1) The prospective lower tier participant certifies, by submission of this proposal, that neither it nor its principals is presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from participation in this transaction by any Federal department or agency.
(2) Where the prospective lower tier participant is unable to certify to any of the statements in this certification, such prospective participant shall attach an explanation to this proposal.
1. By signing and/or submitting this application or grant agreement, the grantee is providing the certification set out below.
2. The certification set out below is a material representation of fact upon which reliance is placed when the agency awards the grant. If it is later determined that the grantee knowingly rendered a false certification, or otherwise violates the requirements of the Drug-Free Workplace Act, the agency, in addition to any other remedies available to the Federal Government, may take action authorized under the Drug-Free Workplace Act.
3. For grantees other than individuals, Alternate I applies.
4. For grantees who are individuals, Alternate II applies.
5. Workplaces under grants, for grantees other than individuals, need not be identified on the certification. If known, they may be identified in the grant application. If the grantee does not identify the workplaces at the time of application, or upon award, if there is no application, the grantee must keep the identity of the workplace(s) on file in its office and make the information available for Federal inspection. Failure to identify all known workplaces constitutes a violation of the grantee's drug-free workplace requirements.
6. Workplace identifications must include the actual address of buildings (or parts of buildings) or other sites where work under the grant takes place. Categorical descriptions may be used (e.g., all vehicles of a mass transit authority or State highway department while in operation, State employees in each local unemployment office, performers in concert halls or radio studios).
7. If the workplace identified to the agency changes during the performance of the grant, the grantee shall inform the agency of the change(s), if it previously identified the workplaces in question (see paragraph five).
8. Definitions of terms in the Nonprocurement Suspension and Debarment common rule and Drug-Free Workplace common rule apply to this certification. Grantees’ attention is called, in particular, to the following definitions from these rules:
A. The grantee certifies that it will or will continue to provide a drug-free workplace by:
(a) Publishing a statement notifying employees that the unlawful manufacture, distribution, dispensing, possession, or use of a controlled substance is prohibited in the grantee's workplace and specifying the actions that will be taken against employees for violation of such prohibition;
(b) Establishing an ongoing drug-free awareness program to inform employees about—
(1) The dangers of drug abuse in the workplace;
(2) The grantee's policy of maintaining a drug-free workplace;
(3) Any available drug counseling, rehabilitation, and employee assistance programs; and
(4) The penalties that may be imposed upon employees for drug abuse violations occurring in the workplace;
(c) Making it a requirement that each employee to be engaged in the performance of the grant be given a copy of the statement required by paragraph (a);
(d) Notifying the employee in the statement required by paragraph (a) that, as a condition of employment under the grant, the employee will—
(1) Abide by the terms of the statement; and
(2) Notify the employer in writing of his or her conviction for a violation of a criminal drug statute occurring in the workplace no later than five calendar days after such conviction;
(e) Notifying the agency in writing, within ten calendar days after receiving notice under paragraph (d)(2) from an employee or otherwise receiving actual notice of such conviction. Employers of convicted employees must provide notice, including position title, to every grant officer or other designee on whose grant activity the convicted employee was working, unless the Federal agency has designated a central point for the receipt of such notices. Notice shall include the identification number(s) of each affected grant;
(f) Taking one of the following actions, within 30 calendar days of receiving notice under paragraph (d)(2), with respect to any employee who is so convicted—
(1) Taking appropriate personnel action against such an employee, up to and including termination, consistent with the requirements of the Rehabilitation Act of 1973, as amended; or
(2) Requiring such employee to participate satisfactorily in a drug abuse assistance or rehabilitation program approved for such purposes by a Federal, State, or local health, law enforcement, or other appropriate agency;
(g) Making a good faith effort to continue to maintain a drug-free workplace through implementation of paragraphs (a), (b), (c), (d), (e) and (f).
B. The grantee may insert in the space provided below the site(s) for the performance of work done in connection with the specific grant:
(a) The grantee certifies that, as a condition of the grant, he or she will not engage in the unlawful manufacture, distribution, dispensing, possession, or use of a controlled substance in conducting any activity with the grant;
(b) If convicted of a criminal drug offense resulting from a violation occurring during the conduct of any grant activity, he or she will report the conviction, in writing, within 10 calendar days of the conviction, to every grant officer or other designee, unless the Federal agency designates a central point for the receipt of such notices. When notice is made to such a central point, it shall include the identification number(s) of each affected grant.
Sec. 319, Pub. L. 101-121 (31 U.S.C. 1352); 31 U.S.C. 321.
See also Office of Management and Budget notice published at 54 FR 52306, December 20, 1989.
(a) No appropriated funds may be expended by the recipient of a Federal contract, grant, loan, or cooperative ageement to pay any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with any of the following covered Federal actions: the awarding of any Federal contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement.
(b) Each person who requests or receives from an agency a Federal contract, grant, loan, or cooperative agreement shall file with that agency a certification, set forth in Appendix A, that the person has not made, and will not make, any payment prohibited by paragraph (a) of this section.
(c) Each person who requests or receives from an agency a Federal contract, grant, loan, or a cooperative agreement shall file with that agency a disclosure form, set forth in Appendix B, if such person has made or has agreed to make any payment using nonappropriated funds (to include profits from any covered Federal action), which would be prohibited under paragraph (a) of this section if paid for with appropriated funds.
(d) Each person who requests or receives from an agency a commitment providing for the United States to insure or guarantee a loan shall file with that agency a statement, set forth in Appendix A, whether that person has made or has agreed to make any payment to influence or attempt to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with that loan insurance or guarantee.
(e) Each person who requests or receives from an agency a commitment providing for the United States to insure or guarantee a loan shall file with that agency a disclosure form, set forth in Appendix B, if that person has made or has agreed to make any payment to influence or attempt to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with that loan insurance or guarantee.
For purposes of this part:
(a)
(b)
(1) The awarding of any Federal contract;
(2) The making of any Federal grant;
(3) The making of any Federal loan;
(4) The entering into of any cooperative agreement; and,
(5) The extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement.
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
(k)
(1) An individual who is appointed to a position in the Government under title 5, U.S. Code, including a position under a temporary appointment;
(2) A member of the uniformed services as defined in section 101(3), title 37, U.S. Code;
(3) A special Government employee as defined in section 202, title 18, U.S. Code; and,
(4) An individual who is a member of a Federal advisory committee, as defined by the Federal Advisory Committee Act, title 5, U.S. Code appendix 2.
(l)
(m)
(n)
(o)
(p)
(q)
(a) Each person shall file a certification, and a disclosure form, if required, with each submission that initiates agency consideration of such person for:
(1) Award of a Federal contract, grant, or cooperative agreement exceeding $100,000; or
(2) An award of a Federal loan or a commitment providing for the United States to insure or guarantee a loan exceeding $150,000.
(b) Each person shall file a certification, and a disclosure form, if required, upon receipt by such person of:
(1) A Federal contract, grant, or cooperative agreement exceeding $100,000; or
(2) A Federal loan or a commitment providing for the United States to insure or guarantee a loan exceeding $150,000, unless such person previously filed a certification, and a disclosure form, if required, under paragraph (a) of this section.
(c) Each person shall file a disclosure form at the end of each calendar quarter in which there occurs any event that requires disclosure or that materially affects the accuracy of the information contained in any disclosure form previously filed by such person under paragraph (a) or (b) of this section. An event that materially affects the accuracy of the information reported includes:
(1) A cumulative increase of $25,000 or more in the amount paid or expected to be paid for influencing or attempting to influence a covered Federal action; or
(2) A change in the person(s) or individual(s) influencing or attempting to influence a covered Federal action; or,
(3) A change in the officer(s), employee(s), or Member(s) contacted to influence or attempt to influence a covered Federal action.
(d) Any person who requests or receives from a person referred to in paragraph (a) or (b) of this section:
(1) A subcontract exceeding $100,000 at any tier under a Federal contract;
(2) A subgrant, contract, or subcontract exceeding $100,000 at any tier under a Federal grant;
(3) A contract or subcontract exceeding $100,000 at any tier under a Federal loan exceeding $150,000; or,
(4) A contract or subcontract exceeding $100,000 at any tier under a Federal cooperative agreement, shall file a certification, and a disclosure form, if required, to the next tier above.
(e) All disclosure forms, but not certifications, shall be forwarded from tier to tier until received by the person referred to in paragraph (a) or (b) of this section. That person shall forward all disclosure forms to the agency.
(f) Any certification or disclosure form filed under paragraph (e) of this section shall be treated as a material representation of fact upon which all receiving tiers shall rely. All liability arising from an erroneous representation shall be borne solely by the tier filing that representation and shall not be shared by any tier to which the erroneous representation is forwarded. Submitting an erroneous certification or disclosure constitutes a failure to file the required certification or disclosure, respectively. If a person fails to file a required certification or disclosure, the United States may pursue all available remedies, including those authorized by section 1352, title 31, U.S. Code.
(g) For awards and commitments in process prior to December 23, 1989, but not made before that date, certifications shall be required at award or commitment, covering activities occurring between December 23, 1989, and the date of award or commitment. However, for awards and commitments in process prior to the December 23, 1989 effective date of these provisions, but not made before December 23, 1989, disclosure forms shall not be required at time of award or commitment but shall be filed within 30 days.
(h) No reporting is required for an activity paid for with appropriated funds
(a) The prohibition on the use of appropriated funds, in § 21.100 (a), does not apply in the case of a payment of reasonable compensation made to an officer or employee of a person requesting or receiving a Federal contract, grant, loan, or cooperative agreement if the payment is for agency and legislative liaison activities not directly related to a covered Federal action.
(b) For purposes of paragraph (a) of this section, providing any information specifically requested by an agency or Congress is allowable at any time.
(c) For purposes of paragraph (a) of this section, the following agency and legislative liaison activities are allowable at any time only where they are not related to a specific solicitation for any covered Federal action:
(1) Discussing with an agency (including individual demonstrations) the qualities and characteristics of the person's products or services, conditions or terms of sale, and service capabilities; and,
(2) Technical discussions and other activities regarding the application or adaptation of the person's products or services for an agency's use.
(d) For purposes of paragraph (a) of this section, the following agencies and legislative liaison activities are allowable only where they are prior to formal solicitation of any covered Federal action:
(1) Providing any information not specifically requested but necessary for an agency to make an informed decision about initiation of a covered Federal action;
(2) Technical discussions regarding the preparation of an unsolicited proposal prior to its official submission; and,
(3) Capability presentations by persons seeking awards from an agency pursuant to the provisions of the Small Business Act, as amended by Pub. L. 95-507 and other subsequent amendments.
(e) Only those activities expressly authorized by this section are allowable under this section.
(a) The prohibition on the use of appropriated funds, in § 21.100 (a), does not apply in the case of a payment of reasonable compensation made to an officer or employee of a person requesting or receiving a Federal contract, grant, loan, or cooperative agreement or an extension, continuation, renewal, amendment, or modification of a Federal contract, grant, loan, or cooperative agreement if payment is for professional or technical services rendered directly in the preparation, submission, or negotiation of any bid, proposal, or application for that Federal contract, grant, loan, or cooperative agreement or for meeting requirements imposed by or pursuant to law as a condition for receiving that Federal contract, grant, loan, or cooperative agreement.
(b) For purposes of paragraph (a) of this section, “professional and technical services” shall be limited to advice and analysis directly applying any professional or technical discipline. For example, drafting of a legal document accompanying a bid or proposal by a lawyer is allowable. Similarly, technical advice provided by an engineer on the performance or operational capability of a piece of equipment rendered directly in the negotiation of a contract is allowable. However, communications with the intent to influence made by a professional (such as a licensed lawyer) or a technical person (such as a licensed accountant) are not allowable under this section unless they provide advice and analysis directly applying their professional or technical expertise and unless the advice or analysis is rendered directly and solely in the preparation, submission or negotiation of a covered Federal action. Thus, for example, communications with the intent to influence made by a lawyer that do not provide legal advice or analysis directly and solely related to the legal aspects of
(c) Requirements imposed by or pursuant to law as a condition for receiving a covered Federal award include those required by law or regulation, or reasonably expected to be required by law or regulation, and any other requirements in the actual award documents.
(d) Only those services expressly authorized by this section are allowable under this section.
No reporting is required with respect to payments of reasonable compensation made to regularly employed officers or employees of a person.
(a) The prohibition on the use of appropriated funds, in § 21.100 (a), does not apply in the case of any reasonable payment to a person, other than an officer or employee of a person requesting or receiving a covered Federal action, if the payment is for professional or technical services rendered directly in the preparation, submission, or negotiation of any bid, proposal, or application for that Federal contract, grant, loan, or cooperative agreement or for meeting requirements imposed by or pursuant to law as a condition for receiving that Federal contract, grant, loan, or cooperative agreement.
(b) The reporting requirements in § 21.110 (a) and (b) regarding filing a disclosure form by each person, if required, shall not apply with respect to professional or technical services rendered directly in the preparation, submission, or negotiation of any commitment providing for the United States to insure or guarantee a loan.
(c) For purposes of paragraph (a) of this section, “professional and technical services” shall be limited to advice and analysis directly applying any professional or technical discipline. For example, drafting or a legal document accompanying a bid or proposal by a lawyer is allowable. Similarly, technical advice provided by an engineer on the performance or operational capability of a piece of equipment rendered directly in the negotiation of a contract is allowable. However, communications with the intent to influence made by a professional (such as a licensed lawyer) or a technical person (such as a licensed accountant) are not allowable under this section unless they provide advice and analysis directly applying their professional or technical expertise and unless the advice or analysis is rendered directly and solely in the preparation, submission or negotiation of a covered Federal action. Thus, for example, communications with the intent to influence made by a lawyer that do not provide legal advice or analysis directly and solely related to the legal aspects of his or her client's proposal, but generally advocate one proposal over another are not allowable under this section because the lawyer is not providing professional legal services. Similarly, communications with the intent to influence made by an engineer providing an engineering analysis prior to the preparation or submission of a bid or proposal are not allowable under this section since the engineer is providing technical services but not directly in the preparation, submission or negotiation of a covered Federal action.
(d) Requirements imposed by or pursuant to law as a condition for receiving a covered Federal award include those required by law or regulation, or reasonably expected to be required by law or regulation, and any other requirements in the actual award documents.
(e) Persons other than officers or employees of a person requesting or receiving a covered Federal action include consultants and trade associations.
(f) Only those services expressly authorized by this section are allowable under this section.
(a) Any person who makes an expenditure prohibited herein shall be subject to a civil penalty of not less than $10,000 and not more than $100,000 for each such expenditure.
(b) Any person who fails to file or amend the disclosure form (see Appendix B) to be filed or amended if required herein, shall be subject to a civil penalty of not less than $10,000 and not more than $100,000 for each such failure.
(c) A filing or amended filing on or after the date on which an administrative action for the imposition of a civil penalty is commenced does not prevent the imposition of such civil penalty for a failure occurring before that date. An administrative action is commenced with respect to a failure when an investigating official determines in writing to commence an investigation of an allegation of such failure.
(d) In determining whether to impose a civil penalty, and the amount of any such penalty, by reason of a violation by any person, the agency shall consider the nature, circumstances, extent, and gravity of the violation, the effect on the ability of such person to continue in business, any prior violations by such person, the degree of culpability of such person, the ability of the person to pay the penalty, and such other matters as may be appropriate.
(e) First offenders under paragraphs (a) or (b) of this section shall be subject to a civil penalty of $10,000, absent aggravating circumstances. Second and subsequent offenses by persons shall be subject to an appropriate civil penalty between $10,000 and $100,000, as determined by the agency head or his or her designee.
(f) An imposition of a civil penalty under this section does not prevent the United States from seeking any other remedy that may apply to the same conduct that is the basis for the imposition of such civil penalty.
Agencies shall impose and collect civil penalties pursuant to the provisions of the Program Fraud and Civil Remedies Act, 31 U.S.C. sections 3803 (except subsection (c)), 3804, 3805, 3806, 3807, 3808, and 3812, insofar as these provisions are not inconsistent with the requirements herein.
The head of each agency shall take such actions as are necessary to ensure that the provisions herein are vigorously implemented and enforced in that agency.
(a) The Secretary of Defense may exempt, on a case-by-case basis, a covered Federal action from the prohibition whenever the Secretary determines, in writing, that such an exemption is in the national interest. The Secretary shall transmit a copy of each such written exemption to Congress immediately after making such a determination.
(b) The Department of Defense may issue supplemental regulations to implement paragraph (a) of this section.
(a) The head of each agency shall collect and compile the disclosure reports (see Appendix B) and, on May 31 and November 30 of each year, submit to the Secretary of the Senate and the Clerk of the House of Representatives a report containing a compilation of the information contained in the disclosure reports received during the six-month period ending on March 31 or September 30, respectively, of that year.
(b) The report, including the compilation, shall be available for public inspection 30 days after receipt of the report by the Secretary and the Clerk.
(c) Information that involves intelligence matters shall be reported only to the Select Committee on Intelligence of the Senate, the Permanent Select Committee on Intelligence of the House of Representatives, and the Committees on Appropriations of the Senate and the House of Representatives in accordance with procedures agreed to by such committees. Such information shall not be available for public inspection.
(d) Information that is classified under Executive Order 12356 or any successor order shall be reported only to the Committee on Foreign Relations of the Senate and the Committee on Foreign Affairs of the House of Representatives or the Committees on Armed Services of the Senate and the House of Representatives (whichever such committees have jurisdiction of matters involving such information) and to the Committees on Appropriations of the Senate and the House of Representatives in accordance with procedures agreed to by such committees. Such information shall not be available for public inspection.
(e) The first semi-annual compilation shall be submitted on May 31, 1990, and shall contain a compilation of the disclosure reports received from December 23, 1989 to March 31, 1990.
(f) Major agencies, designated by the Office of Management and Budget (OMB), are required to provide machine-readable compilations to the Secretary of the Senate and the Clerk of the House of Representatives no later than with the compilations due on May 31, 1991. OMB shall provide detailed specifications in a memorandum to these agencies.
(g) Non-major agencies are requested to provide machine-readable compilations to the Secretary of the Senate and the Clerk of the House of Representatives.
(h) Agencies shall keep the originals of all disclosure reports in the official files of the agency.
(a) The Inspector General, or other official as specified in paragraph (b) of this section, of each agency shall prepare and submit to Congress each year, commencing with submission of the President's Budget in 1991, an evaluation of the compliance of that agency with, and the effectiveness of, the requirements herein. The evaluation may include any recommended changes that may be necessary to strengthen or improve the requirements.
(b) In the case of an agency that does not have an Inspector General, the agency official comparable to an Inspector General shall prepare and submit the annual report, or, if there is no such comparable official, the head of the agency shall prepare and submit the annual report.
(c) The annual report shall be submitted at the same time the agency submits its annual budget justifications to Congress.
(d) The annual report shall include the following: All alleged violations relating to the agency's covered Federal actions during the year covered by the report, the actions taken by the head of the agency in the year covered by the report with respect to those alleged violations and alleged violations in previous years, and the amounts of civil penalties imposed by the agency in the year covered by the report.
The undersigned certifies, to the best of his or her knowledge and belief, that:
(1) No Federal appropriated funds have been paid or will be paid, by or on behalf of the undersigned, to any person for influencing or attempting to influence an officer or employee of an agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with the awarding of any Federal contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement.
(2) If any funds other than Federal appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with this Federal contract, grant, loan, or cooperative agreement, the undersigned shall complete
(3) The undersigned shall require that the language of this certification be included in the award documents for all subawards at all tiers (including subcontracts, subgrants, and contracts under grants, loans, and cooperative agreements) and that all subrecipients shall certify and disclose accordingly.
This certification is a material representation of fact upon which reliance was placed when this transaction was made or entered into. Submission of this certification is a prerequisite for making or entering into this transaction imposed by section 1352, title 31, U.S. Code. Any person who fails to file the required certification shall be subject to a civil penalty of not less than $10,000 and not more than $100,000 for each such failure.
The undersigned states, to the best of his or her knowledge and belief, that:
If any funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with this commitment providing for the United States to insure or guarantee a loan, the undersigned shall complete and submit Standard Form-LLL, “Disclosure Form to Report Lobbying,” in accordance with its instructions.
Submission of this statement is a prerequisite for making or entering into this transaction imposed by section 1352, title 31, U.S. Code. Any person who fails to file the required statement shall be subject to a civil penalty of not less than $10,000 and not more than $100,000 for each such failure.
Title III, Pub. L. 100-202; 31 U.S.C. 321.
In this part, unless the context indicates otherwise:
(a)
(b)
(c)
(d)
(1) With respect to the prepayment of the amounts permitted by this part to be prepaid of FMS Loans held by DSAA, the date designated by the mutual agreement of both the Borrower and DSAA on which the Guaranty will be attached to the Private Loan Note or the Private Loan Portion Notes, as the case may be, the Private Loan will be funded, and the Total Permitted Prepayment Amount, or the portion thereof which the Borrower has selected to prepay, will be prepaid; and
(2) With respect to the prepayment of the amounts permitted by this part to be prepaid of FMS Loans held by the FFB and guaranteed by DSAA, the date designated by the mutual agreement of the Borrower, the FFB, and DSAA on which the Guaranty will be attached to the Private Loan Note or the Private Loan Portion Notes, as the case may be, the Private Loan will be funded, and the Total Permitted Prepayment Amount, or Portion thereof which the Borrower has selected to prepay, will be prepaid.
(e)
(1) Any participation share of, or undivided ownership or other equity interest in, the Private Loan or any Private Loan Portion;
(2) Any note, bond or other debt instrument or obligation which is collateralized or otherwise secured by a pledge of, or secruity interest in, the Private Loan or any Private Loan Portion; or
(3) Any such interest in such an interest or any such instrument secured by such an instrument.
(f)
(g)
(1) Was outstanding on December 22, 1987;
(2) Has principal amounts becoming due and payable after September 30, 1989; and
(3) Bears interest at a rate equal to or greater than 10 percentum per annum.
(h)
(1) Was outstanding on December 22, 1987;
(2) Has principal amounts becoming due and payable after September 30, 1989; and
(3) Bears interest pursuant to the terms of the loan agreement relating thereto at a consolidated rate equal to or greater than 10 percentum per annum.
(i)
(1) Any of the following entities:
(i) Any banking, savings, or lending institution, or any subsidiary or affiliate thereof, chartered or otherwise lawfully organized under the laws of any State, the District of Columbia, the United States or any territory or possession of the United States, including, but not limited to, any bank, trust company, industrial bank, investment banking company, savings association, savings and loan association, building and loan association, savings bank, credit union, or finance company, which is doing business in the United States;
(ii) Any broker or dealer registered with the Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934;
(iii) Any company lawfully organized as an insurance company, and which is subject to supervision by the insurance commissioner or a similar official or agency of a State; or
(iv) Any United States pension fund; or
(2) Any trust or other special purpose financing entity which is funded initially by an entity or entities of the type described in paragraph (i)(1) of this section.
(j)
(k)
(l)
(1) A disbursement of funds made pursuant to a loan agreement between the Borrower and DSAA, which loan agreement provides for making of an FMS Loan; or
(2) A disbursement of funds made pursuant to a loan agreement between the Borrower and the FFB, which loan agreement provides for the making of an FMS Loan.
(m)
(1) A loan made directly by the Secretary of Defense pursuant to section 23 of AECA; or
(2) A loan made by the FFB and guaranteed by the Secretary of Defense pursuant to section 24 of AECA; and “FMS Loans” mean the aggregate of such loans made to or for the account of a Borrower.
(n)
(o)
(p)
(1) With respect to any Derivative which is equal in principal amount to the Private Loan or any Private Loan Portion, that amount of payment on account of such Derivative which is
(2) With respect to any Derivatives which in the aggregate are equal in principal amount to the Private Loan or any Private Loan Portion, that amount of payment on account of such derivatives which is equal to the Guaranteed Loan Amount or the respective Guaranteed Loan Portion Amount, as the case may be.
(q)
(r)
(s)
(t)
(1) The cost of funds to the Borrower for the Private Loan (expressed in terms of the true rate of interest applicable to the Private Loan) if paragraph (a) of § 25.404 applies to the Private Loan; and
(2) The cost of funds to the Borrower for the Private Loan (expressed in terms of the true rate of interest applicable to the Private Loan) if paragraph (a) of § 25.404 does not apply to the Private Loan.
(u)
(v)
(w)
(1) An individual domiciled in the United States;
(2) A corporation incorporated, chartered or otherwise organized in the United States; or
(3) A partnership or other juridical entity doing business in the United States.
(x)
(1) All principal amounts which become due and payable after September 30, 1989, on the respective Eligible FMS Loan or Eligible FMS Advance; and
(2) All unpaid interest, if any, on the respective Eligible FMS Loan or Eligible FMS Advance accrued as of the Closing Date.
(y)
(z)
(aa)
(bb)
(cc)
(1) The aggregate of the respective Permitted P&I Prepayment amount for all Eligible FMS Loans and all Eligible FMS Advances on account of FMS Loans which FMS Loans do not, in themselves, meet the criteria of Eligible FMS Loans; and
(2) The Permitted Arrears Prepayment Amount.
(dd)
(ee)
(ff)
The reporting requirements in this part have been approved under the Office of Management and Budget control number 1505-0109.
(a) To qualify for a loan prepayment at par pursuant to subsection (a) of the Act, a Borrower must have an Eligible FMS Loan or an Eligible FMS Advance.
(b) A Borrower may prepay the Total Permitted Prepayment Amount in portions using more than one closing; however, all prepayments of the Total Permitted Prepayment Amount must have a Closing Date that is not later than September 30, 1991.
(c) A Borrower may prepay all or a portion of the Total Permitted Prepayment Amount; however, if a Borrower selects to prepay any Permitted P&I Prepayment Amount of an FMS Advance, the Borrower must prepay the entire Permitted P&I Prepayment Amount of such FMS Advance.
(d) If the payment billings of an FMS Loan have been consolidated in accordance with the terms of the respective loan agreement, and if any principal payments have been made on account of the FMS Loan, then the outstanding principal balances of any Eligible FMS Advances shall be determined in accordance with the principal of “first disbursed, first repaid,” that is, advances on account of the FMS Loan shall be deemed to have been repaid in the chronological order in which they were disbursed.
(a) Each Borrower that wishes to prepay at par the Total Permitted Prepayment Amount, or any portion thereof, must submit a written prepayment application. To be considered complete, a prepayment application must contain the following information and materials:
(1) Part I of the prepayment application shall be the identification of each Eligible FMS Loan or Eligible FMS Advance, as the case may be, with respect to which the Borrower has selected to prepay the amount thereof permitted by this part to be prepaid, setting forth with respect to each such Eligible FMS Loan or Eligible FMS Advance:
(i) The date on which the Eligible FMS Advance was made or the date on which the Eligible FMS Loan was signed;
(ii) The original amount of the Eligible FMS Loan or Eligible FMS Advance;
(iii) The principal and interest payment schedule of the Eligible FMS Loan or Eligible FMS Advance; and
(iv) The maturity of the Eligible FMS Loan or Eligible FMS Advance.
(2) Part II of the prepayment application shall be the Borrower's estimate of the Permitted Arrears Prepayment Amount calculated as of the date of the application;
(3) Part III of the prepayment application shall be a description of each Private Loan, 90 percent of which the Borrower seeks to have guaranteed, setting forth with respect to each Private Loan:
(i) The total amount of the Private Loan,
(ii) The proposed principal and interest payment schedule of the Private Loan,
(iii) The proposed maturity of the Private Loan, and
(iv) The identity of each Eligible FMS Loan or Eligible FMS Advance with respect to which amount thereof permitted by this part to be prepaid is to be prepaid with the proceeds of the Private Loan;
(4) Part IV of the prepayment application shall be all material transaction documents, in substantially final form, relating to the prepayment of the Total Permitted Prepayment Amount, or the portion thereof which the Borrower has selected to prepay, with the proceeds of the Private Loan; and
(5) Part V of the prepayment application shall be the name, address, and telephone number of the Borrower's contact person with whom the FFB or DSAA will communicate to arrange for prepayment and closing.
(b) Each prepayment application shall be submitted in triplicate to
(c) A Borrower wishing to obtain preliminary, nonbinding review of a plan to prepay at par the Total Permitted Prepayment Amount, or any portion thereof, may, at the Borrower's option, prior to submitting a prepayment application in accordance with paragraph (a) of this section, submit to DSAA, at the address set forth in paragraph (b) of this section, a written plan of prepayment. To qualify for review, a plan of prepayment must include a detailed description of the proposed financing structure clearly addressing the terms and conditions of the proposed Private Loan. DSAA will review each plan of prepayment submitted by Borrowers and may engage in informal, non-binding discussions with each Borrower that submitted a plan of prepayment to assist such Borrower in preparing a prepayment application.
(a)
(2) DSAA will review each completed prepayment application to ensure that the Private Loan complies with the requirements of this part, including without limitation the requirements of § 25.400. DSAA will also review each completed prepayment application to ensure that the provisions of subsection (d) of the Act (Purposes and Reports) are considered. DSAA will process each completed prepayment application within 16 days after receipt by DSAA of the respective completed application from a Borrower.
(3) After DSAA has processed a completed prepayment application, DSAA will either:
(i) Return the application to the Borrower; or
(ii) Deliver to the State Department written evidence of the approval of the prepayment application by DSAA.
(b)
(2) After the State Department has processed Parts I and II of a prepayment application, the State Department will either:
(i) Return the parts of the application to DSAA for return to the Borrower; or
(ii) Deliver to the Treasury Department written evidence of the approvals of the prepayment application by DSAA and the State Department.
(c)
(ii) After the Treasury Department has processed Parts I and II of a prepayment application, the Treasury Department will return the parts of the application to DSAA, and thereupon DSAA will commence the Closing Procedures described in § 25.303(a) with respect to the application.
(2)
(ii) After the Treasury Department has processed Parts I and II of a prepayment application, the Treasury Department will commence the Closing Procedures described in § 25.303(b) with respect to the application.
A Borrower that submits a prepayment application may withdraw the prepayment application at any time prior to its approval. Even after a Borrower's prepayment application has been approved, the Borrower is not obligated to prepay its Eligible FMS Loans or Eligible FMS Advances.
(a)
(2) On the Closing Date, the Guaranty will be attached to the Private Loan Note or the Private Loan Portion Notes, as the case may be, the Private Loan shall be funded, and the Total Permitted Prepayment Amount, or the portion thereof which the Borrower has selected to prepay, will be prepaid.
(3) The attachment of the Guaranty to the Private Loan Note or the Private Loan Portion Notes, as the case may be, will take place at such location as may be designated by the mutual agreement of the Borrower and DSAA.
(4) Prior to 1:00 p.m. prevailing local time in New York, New York, on the Closing Date, immediately available funds in amounts sufficient to prepay the Total Permitted Prepayment Amount, or the portion thereof which the Borrower has selected to prepay, shall be transferred by electronic funds transfer to DSAA at the Treasury Department account at the Federal Reserve Bank of New York. The funds transfer message must include the following credit information:
(b)
(2) On the Closing Date, the Guaranty will be attached to the Private Loan Note or the Private Loan Portion Notes, as the case may be, the Private Loan will be funded, and the Total Permitted Prepayment Amount, or the portion thereof which the Borrower has selected to prepay, will be prepaid.
(3) The attachment of the Guaranty to the Private Loan Note or the Private Loan Portion Notes, as the case
(4) Prior to 1:00 p.m. prevailing local time in New York, New York, on the Closing Date, immediately available funds in amounts sufficient to prepay at par the Permitted Prepayment Amount, or the portion thereof which the Borrower has selected to prepay, shall be transferred by electronic funds transfer to the Treasury Department account at the Federal Reserve Bank of New York. The funds transfer message must include the following credit information:
(c)
(a) Subject to the provisions of paragraph (b) of this section, the principal and interest payment schedule and maturity of the Private Loan must be the same as the payment schedules and maturities of the Eligible FMS Loans or Eligible FMS Advances, as the case may be, which the Borrower has selected to prepay with the proceeds of the Private Loan.
(b) Notwithstanding the preceding paragraph, an Eligible Private Lender that proposes to make a Private Loan, the proceeds of which will be used to prepay Eligible FMS Loans or Eligible FMS Advances, as the case may be, having differing payment structures and maturities, may:
(1) Consolidate the differing payment structures of the Eligible FMS Loans or the Eligible FMS Advances, as the case may be, into a single payment structure which complies with the following criteria:
(i) The Private Loan shall have one set of semi-annual payment dates;
(ii) Interest on and principal of the Private Loan shall be payable semi-annually; and
(iii) The amount of principal to be paid each year on account of the Private Loan shall be equal (rounded to the nearest $1,000.00 if desired, except for the final payment) to the aggregate amount of principal that is scheduled to be paid in such year on account of the respective Eligible FMS Loans or Eligible FMS Advances; or
(2) Consolidate the differing payment structures and maturities of the Eligible FMS Loans or the Eligible FMS Advances, as the case may be, into a single payment structure and maturity complying with the following criteria:
(i) The final maturity date of the Private Loan shall be the approximate weighted average of the final maturity dates of the Eligible FMS Loans or the Eligible FMS Advances with respect to which the Borrower has selected to prepay amounts thereof permitted by this part to be prepaid;
(ii) The initial principal payment date of the Private Loan shall occur no later than the earliest scheduled principal payment date of the Eligible FMS Loans or the Eligible FMS Advances with respect to which the Borrower has selected to prepay amounts thereof permitted by this part to be prepaid;
(iii) The Private Loan shall have one set of semi-annual payment dates;
(iv) Interest on the Private Loan shall be payable semi-annually; and
(v) The principal of the Private Loan shall be payable in equal installments
The interest rate on the Private Loan may include compensation for costs at prevailing market rates with the agreement of the Borrower and the Eligible Private Lender selected by the Borrower.
Each Private Loan Note, with the Guaranty attached, shall be fully and freely transferable to any Permitted Guaranty Holder.
The Guaranty shall cease to be effective with respect to the Private Loan or any Private Loan Portion or any Derivative to the extent that the Private Loan or the respective Private Loan Portion or the respective Derivative, as the case may be, is used to provide significant support for a Non-Registered Obligation.
(a) The Guaranty shall cease to be effective with respect to any Guaranteed Loan Amount or any Guaranteed Loan Portion Amount or any Guaranteed-Amount Equivalent to the extent that:
(1) The Guaranteed Amount or the respective Guaranteed Loan Portion Amount or the respective Guaranteed-Amount Equivalent, as the case may be, is separated at any time from the Unguaranteed Loan Amount or the respective Unguaranteed Loan Portion Amount or the respective Unguaranteed-Amount Equivalent, as the case may be, in any way, directly or through the issuance of any Guaranteed-Amount Equity Derivative or any Guaranteed-Amount Debt Derivative; or
(2) Any holder of the Private Loan Note or any Private Loan Portion Note or any Derivative, as the case may be, having a claim to payments on the Private Loan receives more than 90 percent of any payment due to such holder from payments made under the Guaranty at any time during the term of the Private Loan.
(b) Notwithstanding the preceding paragraph, if any Guaranteed-Amount Debt Derivative is issued, the Guaranty shall not cease to be effective with respect to any Guaranteed Loan Amount or any Guaranteed Loan Portion Amount or any Guaranteed-Amount Equivalent, as the case may be, if both of the circumstances described in paragraphs (b)(1) and (b)(2) of this section.
(1) A Borrower shall have delivered to the Secretary of the treasury evidence, in form and substance satisfactory to the Secretary of the Treasury, that the Interest Rate Difference will be substantial.
(i) To be considered, the evidence must meet the following requirements:
(A) The Borrower must show that the Interest Rate Difference is directly attributable to paragraph (a) of this section being applied to the Private Loan, that is, that the Interest Rate Difference will exist even when all other financing terms of the Private Loan, including any collateralization of the Unguaranteed Loan Amount or the respective Unguaranteed Loan Portion Amount or the respective Unguaranteed-Amount Equivalent, as the case may be, are identical;
(B) When calculating the Interest Rate Difference, the Borrower must assume that the Unguaranteed Loan Amount or the respective Unguaranteed Loan Portion Amount or the respective Unguaranteed-Amount Equivalent, as the case may be, will be collateralized by securities backed by the full faith and credit of the United States, unless the Borrower is legally prohibited from so collateralizing the Unguaranteed Loan Amount or the respective Unguaranteed Loan Portion Amount or the respective Unguaranteed-Amount Equivalent, as the case may be, or the Borrower has demonstrated to the satisfaction of the Secretary of the Treasury that the Borrower is unable to so collateralize the Unguaranteed Loan Amount or the respective Unguaranteed Loan Portion Amount or the respective Unguaranteed-Amount Equivalent;
(C) If the Borrower is legally prohibited from collateralizing the Unguaranteed Loan Amount or the respective Loan Guaranteed Portion
(D) If the Borrower delivers evidence to the Secretary of the Treasury respecting the Interest Rate Difference, which evidence assumes either that the Unguaranteed Loan Amount or the respective Unguaranteed Loan Portion Amount or the respective Unguaranteed-Amount Equivalent, as the case may be, will not be collateralized at all or that the Unguaranteed Loan Amount or the respective Unguaranteed Loan Portion Amount or the respective Unguaranteed-Amount Equivalent, as the case may be, will be collateralized, but not by securities backed by the full faith and credit of the United States, then the Borrower must also deliver to the Secretary of the Treasury the written agreement of the Borrower, which agreement shall be in form and substance satisfactory to the Secretary of the Treasury, that the Borrower will not collateralize the Unguaranteed Loan Amount or the respective Unguaranteed Loan Portion Amount or the respective Unguaranteed-Amount Equivalent, as the case may be, at any time during the term of the Private Loan in any way different from the assumptions used in calculating the Interest Rate Difference; and
(E) The Borrower must deliver to the Secretary of the Treasury the evidence pertaining to the Interest Rate Difference at the time that the Borrower submits to DSAA its plan for prepayment, if any, if no plan of prepayment is submitted, then no later than 10 days prior to the time that the Borrower submits to DSAA its prepayment application.
(ii) If the Secretary of the Treasury determines that the evidence submitted by the Borrower pertaining to the Interest Rate Difference is satisfactory in form and in substance, and that the Interest Rate Difference is substantial, a modified version of the Guaranty (deleting therefrom the provision that the Guaranty shall cease to be effective if any Guaranteed-Amount Debt Derivative is issued) will be attached to the Private Loan Note or the Private Loan Portion Notes, as the case may be.
(2) The Secretary of the Treasury shall have determined, in the sole discretion of the Secretary of the Treasury, that the respective Borrower's loan prepayment at par pursuant to subsection (a) of the Act through the issuance of any Guaranteed-Amount Debt Derivative is necessary to achieve the international economic policy interests of the United States.
(a) The Guaranty that will be attached to the Private Loan Note on the Closing Date shall be in the following form (except that the bracketed words shall be deleted if the conditions specified in § 25.404(b) shall have occurred):
For Value Received, the Defense Security Assistance Agency of the Department of Defense (“DSAA”), hereby guarantees to (Name of Lender) (“Lender”), incorporated under the laws of (U.S. State or other U.S. jurisdiction) or if not so incorporated or organized, then the principal place of doing business is (U.S. location, address, and zip code), under the authority of Section 24 of the Arms Export Control Act, as amended (“Act”), the due and punctual payment of ninety percent (90%) of amounts due: (1) on the promissory note (“Note”) in the principal amount of up to $——— dated ——— issued to the Lender by the Government of (Name of Borrower) (“Borrower”) pursuant to the Loan Agreement between the Lender and the Borrower dated the ——th day of ——— (“Agreement”); and (2) the Lender from the Borrower pursuant to the Agreement.
This Guaranty is a guaranty of payment covering all political and credit risks of nonpayment, including any nonpayment arising out of any claim which the Borrower may now or hereafter have against any person, corporation, or other entity (including without limitation, the United States, the Lender, and any supplier of defense items) in connection with any transaction, for any reason whatsoever. This Guaranty shall inure to the benefit of and shall be enforceable by the
DSAA hereby waives diligence, demand, protest, presentment and any requirement that the Lender exhaust any right or power to take any action against the Borrower and any notice of any kind whatsoever other than the demand for payment required to be given to DSAA hereunder in the event of default on a payment due under the Note.
In the event of failure of the Borrower to make payment, when and as due, of any installment of principal or interest under the Note, the DSAA shall make payment immediately to the Lender upon demand to the DSAA after the Borrower's failure to pay has continued for 10 calendar days. The amount payable under this Guaranty shall be ninety percent (90%) of the amount of the overdue installment of principal and interest, plus ninety percent (90%) of any and all late charges and interest thereon as provided in the Agreement. Upon payment by DSAA to the Lender, the Lender will assign to DSAA, without recourse or warranty, ninety percent (90%) of all of its rights in the Note and the Agreement with respect to such payment.
In the event of a default under the Agreement or the Note by the Borrower and so long as this Guaranty is in effect and the DSAA is not in default hereunder:
(i) The Lender or other Permitted Guaranty Holder shall not accelerate or reschedule payment of the principal or interest on the Note or any other note of the Borrower guaranteed by DSAA except with the written approval of DSAA; and
(ii) The Lender or other Permitted Guaranty Holder shall, if so directed by DSAA, invoke the default provisions of the Agreement.
Subject to the limitations set forth below, the Lender's rights under this Guaranty may be assigned to any “Permitted Guaranty Holder,” that is: (1) An individual domiciled in the United States; (2) a corporation incorporated, chartered or otherwise organized in the United States; or (3) a partnership or other juridical entity doing business in the United States. In the event of such assignment DSAA shall be promptly notified. The Lender will not agree to any material amendment of the Agreement or Note or consent to any material deviation from the provisions thereof without the prior written consent of DSAA.
Permitted Guaranty Holders shall be severally bound by, and shall be severally entitled to, the rights and obligations of the Lender under the Note, the Agreement, and this Guaranty. The Lender shall maintain a current, accurate written record of the names, addresses, amount of financial interest in the Note and Agreement, and date of acquisition of such interest of each Permitted Guaranty Holder and shall furnish DSAA a copy of such record on its demand without charge. No assignment by the Lender or by any Permitted Guaranty Holder shall be effective for purposes of this Guaranty unless and until so recorded by the Lender.
The total amount of this Guaranty shall not at any time exceed ninety percent (90%) of the outstanding principal, unpaid accrued interest and arrearages, if any, under the Agreement and the Note, including any portion of the Note, or any derivative of the Note or any portion of the Note.
This Guaranty shall cease to be effective with respect to the guaranteed amount of the total amount of the Note (the “Guaranteed Loan Amount”) or with respect to the guaranteed amount of any portion of the Note (the “Guaranteed Loan Portion Amount”) [or with respect to the amount of any derivative or derivatives of the Note or any portion of the Note equal, or in the aggregate equal, in principal amount to the total amount of the Note or such portion of the Note, as the case may be, which amount of such derivative or derivatives is equal to the respective Guaranteed Loan Amount or Guaranteed Loan Portion Amount, as the case may be (the “Guaranteed-Amount Equivalent”)] to the extent that (1) the Guaranteed Loan Amount or the respective Guaranteed Loan Portion Amount [or the respective Guaranteed-Amount Equivalent], as the case may be, is at any time separated from the unguaranteed amount of the total amount of the Note or the unguaranteed amount of the respective portion of the Note [or the amount of such derivative or derivatives of the Note which is not the amount which is equal to the Guaranteed Loan Amount or Guaranteed Loan Portion Amount, as the case may be], in any way, (a) directly, or (b) through the issuance of participation shares of, or undivided ownership or other equity interests in, the Note, or any portion of the Note, or any derivative of the Note or any portion of the Note, which have an exclusive or preferred claim to the Guaranteed Loan Amount or the respective Guaranteed Loan Portion Amount [or the respective Guaranteed-Amount Equivalent], as the case may be [or (c) through the issuance of notes, bonds or other debt instruments or obligations which are collateralized or otherwise secured by a pledge of, or security interest in, the Note, or any portion of the Note or any derivative of the Note or any portion
This Guaranty is fully and freely transferable to any Permitted Guaranty Holder, except that it shall cease to be effective with respect to the Agreement or the Note, or any portion of the Note, or any derivative of the Note or any portion of the Note, to the extent that the Agreement or the Note, or the respective portion of the Note, or the respective derivative of the Note or any portion of the Note, as the case may be, is used to provide significant support for any non-registered obligation.
The full faith and credit of the United States is pledged to the performance of this Guaranty. No claim which the United States may now or hereafter have against the Lender or any Permitted Guaranty Holder for any reason whatsoever shall affect in any way the right of the Lender or any Permitted Guaranty Holder to receive full and prompt payment of any amount otherwise due under this Guaranty. The United States represents and warrants that (a) it has full power, authority and legal right to execute, deliver and perform this Guaranty, (b) this Guaranty has been executed in accordance with and pursuant to the terms and provisions of section 24 of the Act, the provisions of the Foreign Operations, Export Financing, and Related Programs Appropriations Act, 1988, under the hearing “Foreign Military Sales Debt Reform,” and title 31, part 25, of the Code of Federal Regulations, (c) this Guaranty has been duly executed and delivered by a duly authorized representative of DSAA, and (d) this Guaranty constitutes the valid and legally binding obligations of the United States, enforceable in accordance with the terms hereof.
Any notice, demand, or other communication hereunder shall be deemed to have been given if in writing and actually delivered to the Comptroller, DSAA, the Pentagon, Washington, DC 20301-2800, or the successor, or such other place as may be designated in writing by the Comptroller, DSAA or the successor thereof.
By acceptance of the Note, the Lender agrees to the terms and conditions of this Guaranty.
(b) The obligations of DSAA under the Guaranty are expressly limited to those obligations contained in the form of Guaranty set forth in paragraph (a) of this section. Any provisions of any agreement relating to the Private Loan purporting to create obligations on the part of DSAA which are inconsistent with the terms of the Guaranty or any other provision of this part be unenforceable against DSAA.
Nothing in this rule is intended to authorize any person or entity to engage in any activity not otherwise authorized or permitted for such person or entity under any applicable laws of the United States, any territory or possession of the United States, any State, or the District of Columbia.
22 U.S.C. 262m-7, 31 U.S.C. 321.
This part prescribes procedures for the environmental review of, and comment by Federal agencies and the public on, proposed projects of multilateral development banks (MDBs).
(a) The Office of Multilateral Development Banks of the Department of the Treasury (hereinafter “MDB Office”) will ensure that the Environmental Protection Agency (EPA), the Council on Environmental Quality (CEQ), the Department of State, the Agency for International Development (AID), the National Oceanic and Atmospheric Administration (NOAA), and the Bank Information Center (BIC)
(b)(1) Members of the public may obtain copies of project listings from the BIC, 2025 Eye Street NW., suite 522, Washington, DC 20006 ((202) 466-8191, not a toll-free call).
(2) If a copy is not available from the BIC, members of the public may arrange to review and/or copy a project listing by contacting the MDB Office which will make a copy available at the Department of the Treasury Library, 1500 Pennsylvania Avenue NW., Washington, DC ((202) 622-0990, not a toll-free call). Members of the public are advised that they must make an appointment with the Treasury Library before they visit and that a charge (currently 15 cents per page) is imposed for the use of the library photocopier.
(a)
(2) (i) Members of the public may obtain copies of EIA Summaries from the BIC, 2025 Eye Street, NW., suite 522, Washington, DC 20006 ((202) 466-8191, not a toll-free call).
(ii) If a copy of an EIA Summary is not available from the BIC, members of the public may arrange to review and/or copy an EIA Summary by contacting the MDB Office at (202) 622-0765 (not a toll-free call), which will make a copy available at the Department of the Treasury Library, 1500 Pennsylvania Avenue NW., Washingon, DC. Members of the public are advised that they must make an appointment with the Treasury Library (202) 622-0990) before they visit, and that a charge (currently 15 cents per page) is imposed for the use of the library photocopier. To the extent possible, EIA Summaries will be available for review and copying at least 120 days before scheduled consideration of a project by the MDB Executive Directors.
(b)
(2)
(ii) If a particular MDB does not have a public reading room, members of the public may arrange to review and/or copy an EIA by contacting the MDB Office ((202) 622-0765 (not a toll-free call)), which will obtain a copy through the Office of the United States Executive Director of the concerned MDB and make it available in the Department of the Treasury Library, 1500 Pennsylvania Avenue NW., Washington, DC. Members of the public are advised that they must make an appointment with the Treasury Library ((202) 622-0990 not a toll-free call) before they visit, and that a charge (currently 15 cents per page) is imposed for the use of the library photocopier.
(a)
(ii) All written comments will be available for inspection and copying in their entirety in the Department of the Treasury Library, 1500 Pennsylvania Avenue NW., Washington, DC ((202) 622-0990). Members of the public are advised that they must make an appointment with the Treasury Library before they visit, and that a charge (currently 15 cents per page) is imposed for the use of the library photocopier.
(2)
(b)
(c)
(a)
(b)
(i) A MDB project would have a significant impact on the human environment, and
(ii) The MDB appears to have made an appropriate decision that such project merits environmental analysis, but less than a full-fledged environmental impact assessment as defined by that MDB's own procedures, the Department of the Treasury will obtain, through the United States Executive Director of the concerned MDB, such environmental information from the MDB (
(2) If such environmental information is insufficient to provide an adequate basis for analyzing the environmental impact of the proposed project and alternatives to the proposed project, the
31 U.S.C. 321, 333.
(a) The regulations in this part implement the provisions of 31 U.S.C. 333(c), which authorizes the Secretary of the Treasury to assess a civil penalty against any person who has misused the words, titles, abbreviations, initials, symbols, emblems, seals, or badges of the Department of the Treasury or any subdivision thereof in violation of 31 U.S.C. 333(a), in accordance with that section and this part.
(b) The regulations in this part do not apply to the extent that the Secretary or his/her designee has specifically authorized the person to manufacture, produce, sell, possess, or use the words, titles, abbreviations, initials, symbols, emblems, seals, or badges by written contract, agreement, or letter.
(a) The term “assessing official” means:
(1) The head of a bureau or other subdivision of the Department of the Treasury who has been delegated the authority to assess civil penalties under 31 U.S.C. 333(c); or
(2) An officer or employee of a bureau or subdivision at the grade of GS-15 or above to whom such authority has been redelegated by the head of such bureau or subdivision.
(b) The term “broadcast” or “telecast” mean widespread dissemination by electronic transmission or method, whether audio and/or visual.
(c) The term “civil penalty” means:
(1) A civil monetary penalty; and
(2) Any other civil or equitable remedy deemed necessary to rectify the potential for a continued misuse or harm from an activity found to have been in violation of 31 U.S.C. 333 or this part.
(d) The term “date of offense” means the later of—
(1) The date that the misuse occurred;
(2) The date that the misuse had the effect of conveying the false impression that the activity was associated with or approved, endorsed, sponsored or authorized by the Department or any of its subdivisions or officers or employees; or
(3) If the violation is a continuing one, the date on which the misuse of the words, titles, abbreviations, initials, symbols, emblems, seals, or badges protected by this part last occurred.
(e) The term “days” means calendar days, unless otherwise stated.
(f) The term “person” means an individual, partnership, association, corporation, company, business, firm, manufacturer, or any other organization or institution.
(a)
(1) Who uses in connection with, or as a part of, any advertisement, solicitation, business activity, or product, whether alone or with other words, letters, symbols, or emblems;
(i) The words “Department of the Treasury,” “United States Secret Service,” “United States Customs Service,” “Internal Revenue Service,” “Bureau of Alcohol, Tobacco and Firearms,” “Bureau of the Public Debt,” “Bureau of Engraving and Printing,” “Comptroller of the Currency,” “Federal Law Enforcement Training Center,” “Financial Crimes Enforcement Network,” “United States Mint,” or the name of any service, bureau, office, or other subdivision of the Department of the Treasury;
(ii) The titles “Secretary of the Treasury,” “Treasurer of the United States,” “Director of the Secret Service,” “Commissioner of Customs,” “Commissioner of Internal Revenue,” “Director, Bureau of Alcohol, Tobacco and Firearms,” “Commissioner of the Public Debt,” “Director of the Bureau of Engraving and Printing,” “Comptroller of the Currency,” “Director of the Federal Law Enforcement Training Center,” “Director of the Financial Crimes Enforcement Network,” “Director of the United States Mint,” or the title of any other officer or employee of the Department of the Treasury or subdivision thereof;
(iii) The abbreviations or initials of any entity or title referred to in paragraph (a)(1)(i) or (a)(1)(ii) of this section, including but not limited to “USSS,” “USCS,” “IRS,” “ATF,” or “BATF,” “BPD,” “FLETC,” “FINCEN” or “FinCEN,”and “SBMO”;
(iv) The words “United States Savings Bond,” including any variation thereof, or the name of any other security, obligation, or financial instrument issued by the Department of the Treasury or any subdivision thereof;
(v) Any symbol, emblem, seal, or badge of an entity referred to in paragraph (a)(1)(i) of this section (including the design of any envelope, stationery, or identification card used by such an entity); or
(vi) Any colorable imitation of any such words, titles, abbreviations, initials, symbol, emblem, seal, or badge; and
(2) Where such use is in a manner that could reasonably be interpreted or construed as conveying the false impression that such advertisement, solicitation, business activity, or product is in any manner approved, endorsed, sponsored, or authorized by, or associated with the Department of the Treasury or any entity referred to in paragraph (a)(1)(i) of this section, or any officer, or employee thereof.
(b)
(c)
(d)
(2) An assessing official may commence a civil action to recover or enforce any civil penalty imposed in a Final Notice of Assessment issued pursuant to § 27.7 at any time before the end of the two year period beginning on the date of the Final Notice of Assessment. If judicial review of the Final Notice of Assessment is sought, the two year period begins to run from the date that a final and unappealable court order is issued.
(e)
The assessing official will consider relevant factors when determining whether to assess or impose a civil penalty under this part, and the amount of a civil monetary penalty. Those factors may include, but are not limited to, the following:
(a) The scope of the misuse;
(b) The purpose and/or nature of the misuse;
(c) The extent of the harm caused by the misuse;
(d) The circumstances of the misuse; and
(e) The benefit intended to be derived from the misuse.
The assessing official shall serve an Initial Notice of Assessment by United States mail or other means upon any person believed to be in violation of § 27.3 and otherwise subject to a civil
(a) A specific reference to the provisions of § 27.3 violated;
(b) A concise statement of the facts that support the conclusion that such a violation occurred;
(c) The amount of the penalty proposed, and/or any other proposed civil or equitable remedy;
(d) A notice informing the person alleged to be in violation of § 27.3 that he/she:
(1) May, within 30 days of the date of the notice, pay the proposed civil monetary penalty and consent to each proposed civil or equitable remedy, thereby waiving the right to make a written response under § 27.6 and to seek judicial review under § 27.8:
(i) By electronic funds transfer (EFT) in accordance with instructions provided in the notice, or
(ii) By means other than EFT only with the written approval of the assessing official;
(2) May make a written response within 30 days of the date of the notice asserting, as appropriate:
(i) Why a civil monetary penalty and/or other civil or equitable remedy should not be imposed;
(ii) Why a civil monetary penalty should be in a lesser amount than proposed; and
(iii) Why the terms of a proposed civil or equitable remedy should be modified;
(3) May be represented by an attorney or other representative, provided that a designation of representative signed by the person alleged to be in violation is received by the assessing official; and
(4) May request, within 20 days of the date of the notice, a copy of or opportunity to review any documents and/or other evidence compiled and relied on by the agency in determining to issue the notice (the assessing official reserves the right to assert privileges available under law and may decline to disclose certain documents and/or other evidence); and
(e) The Initial Notice of Assessment shall also inform the person that:
(1) If no written response is received within the time allowed in § 27.6(b), a Final Notice of Assessment may be issued without a presentation by the person;
(2) If a written response has been made and it is deemed necessary, the assessing official may request, orally or in writing, additional information from the respondent;
(3) A Final Notice of Assessment may be issued in accordance with § 27.7 requiring that the civil monetary penalty be paid and compliance with the terms of any other civil or equitable remedy;
(4) A Final Notice of Assessment is subject to judicial review in accordance with 5 U.S.C. 701
(5) All submissions sent in response to the Initial
Notice of Assessment must be transmitted to the address specified in the notice and include the name, address, and telephone number of the respondent.
(a)(1) A person served with an Initial Notice of Assessment may make a written response explaining why the civil penalty should not be imposed, explaining why a civil monetary penalty should be in a lesser amount than proposed and/or explaining why the terms of a proposed civil or equitable remedy should be modified. The written response must provide:
(i) A reference to and specifically identify the Initial Notice of Assessment involved;
(ii) The full name of the person charged;
(iii) If not a natural person, the name and title of the head of the organization charged; and
(iv) If a representative of the person charged is filing the written response, a copy of the duly executed designation as representative.
(2) The written response must admit or deny each violation of § 27.3 charged in the Initial Notice of Assessment. Any charge not specifically denied will be presumed to be admitted. Where a charge is denied, the respondent shall
(b)
(2) If a request for documents or other evidence is made pursuant to § 27.5(d)(4), the written response must be received not later than 20 days after the date of the Department's response to the request.
(3)(i) In computing the number of days allowed for filing a written response under this paragraph, the first day counted is the day after the date of the Initial Notice of Assessment. If the last date on which the response is required to be filed by this paragraph is a Saturday, Sunday or Federal holiday, the response will be due on the next weekday after that date.
(ii) If a response is transmitted by United States mail, it will be deemed timely filed if postmarked on or before the due date.
(4) The assessing official may extend the period for making a written response under paragraphs (b)(1) and (b)(2) for good cause shown. Generally, failure to obtain representation in a timely manner will not be considered good cause.
(c)
(d) The assessing official will fully consider the facts and arguments submitted by the respondent in the written response and any other documents filed pursuant to this paragraph in determining whether to issue a Final Notice of Assessment under § 27.7, the appropriate amount of the civil monetary penalty imposed and the terms of any other appropriate civil or equitable remedy.
(a) In making a final determination whether to impose a penalty, the assessing official shall take into consideration all available information in the administrative record on the matter, including all information provided in or with a written response timely filed by the respondent and any additional information provided pursuant to § 27.5(e)(2). The assessing official will determine whether:
(1) The facts warrant a conclusion that no violation has occurred; or
(2) The facts warrant a conclusion that one or more violations have occurred; and
(3) The facts and violations found justify the conclusion that a civil penalty should be imposed.
(b) If the assessing official determines that no violation has occurred, the official shall promptly send a letter indicating that determination to the person served with an Initial Notice of Assessment and to any designated representative of such person.
(c)(1) If it has been determined that a violation has occurred, the assessing official shall issue a Final Notice of Assessment to the person served with an Initial Notice of Assessment and to any designated representative of such person.
(2) The assessing official may, in his/her discretion:
(i) Impose a civil monetary penalty and/or any civil or equitable remedy deemed necessary to rectify the potential for a continued misuse or harm from the violation(s);
(ii) Not impose a civil monetary penalty and/or civil or equitable remedy; or
(iii) Impose a civil monetary penalty and/or civil or equitable remedy and condition payment of the civil monetary penalty on the violator's future compliance with 31 U.S.C. 333, this part
(3) The Final Notice of Assessment shall:
(i) Include:
(A) A specific reference to the provisions of § 27.3 found to have been violated;
(B) A concise statement of the facts warranting a conclusion that a violations has occurred;
(C) An analysis of how the facts and violation(s) justify the conclusion that a civil monetary penalty and/or civil or equitable remedy should be imposed; and
(D) The amount of each civil monetary penalty imposed, a statement as to how the amount of each penalty was determined, and the terms of any civil or equitable remedy deemed necessary to rectify the potential for a continued misuse or harm from the violation(s); and
(ii) Inform the person that:
(A) Payment of a civil monetary penalty imposed by the Final Notice of Assessment must be made within 30 days of the date of the notice, and that any civil or equitable remedy imposed must be complied with as provided in the Final Notice of Assessment;
(B) Payment of a civil monetary penalty imposed by the Final Notice of Assessment shall be by EFT in accordance with instructions provided in the notice, unless the assessing official has given written approval to have payment made by other means;
(C) payment of a civil monetary penalty imposed by the Final Notice of Assessment constitutes consent by the person to comply with the terms of any civil or equitable remedy contained in the notice;
(D) If payment of a civil monetary penalty imposed by the Final Notice of Assessment has been waived on the condition that the person comply with the terms of any civil or equitable remedy contained in the notice or comply in the future with 31 U.S.C. 333 and this part, failure by the person to so comply will make the civil monetary penalty payable on demand;
(E) If a civil monetary penalty is not paid within 30 days of the date of the Final Notice of Assessment (or on demand under paragraph (C)(3)(ii)(D) of this sectiion), or if a civil or equitable remedy is not complied with in accordance with the terms of the notice, a civil action to collect the penalty or enforce compliance may be commenced at any time within two years of the date of the Final Notice of Assessment; and
(F) Any civil monetary penalty and civil or equitable remedy imposed by the Final Notice of Assessment may be subject to judicial review in accordance with 5 U.S.C. 701 et seq.
A final Notice of Assessment issued under this party may be subject to judicial review pursuant to 5 U.S.C. 701 et seq.
The following abbreviation is used in this chapter:
C. P. D.=
Sec. 209, 79 Stat. 257; 31 U.S.C. 405a-1.
The General Services Administration, as agent for the Treasury Department, will conduct periodic sales of silver as agreed upon between GSA and the Treasury Department. Sales will be under competitive bidding procedures established by agreement between GSA and the Treasury Department. Details of the bidding and selling procedures are obtainable by telephone or by writing to General Services Administration, Property Management and Disposal Service, Industry Materials Division, Metals Project, Washington, DC 20405.
Sales of silver will be at prices offered through the competitive bidding procedures referred to in § 56.1, and accepted by the GSA.
5 U.S.C. 301, by delegation from the Administrator of General Services, 35 FR 14426, and Treasury Department Order 177-25 (Revision 2), 38 FR 21947.
The regulations in this part governing conduct in and on the Bureau of the Mint buildings and grounds located as follows: U.S. Mint, Colfax, and Delaware Streets, Denver, Colorado; U.S. Bullion Depository, Fort Knox, Kentucky; U.S. Assay Office, 32 Old Slip New York, New York; U.S. Mint, 5th and Arch Streets, Philadelphia, Pennsylvania; U.S. Assay Office, 155 Hermann Street, and the Old U.S. Mint Building, 88 Fifth Street, San Francisco, California; and U.S. Bullion Depository, West Point, New York; are promulgated pursuant to the authority vested in the Secretary of the Treasury, including 5 U.S.C. 301, and that vested in him by delegation from the Administrator of General Services, 38 FR 20650 (1973), and in accordance with the authority vested in the Director of the Mint by Treasury Department Order No. 177-25 Revision 2), dated August 8, 1973, 38 FR 21947 (1973).
The regulations in this part apply to the buildings and grounds of the Bureau of the Mint located as follows: U.S. Mint, Colfax and Delaware Streets, Denver, Colorado; U.S. Bullion Depository, Fort Knox, Kentucky; U.S. Assay Office, 32 Old Slip, New York, New York; U.S. Mint, Fifth and Arch Streets, Philadelphia, Pennsylvania; U.S. Assay Office, 155 Hermann Street, and the Old U.S. Mint Building, 88 Fifth Street, San Francisco, California; and U.S. Bullion Depository, West Point, New York; and to all persons entering in or on such property. Unless otherwise stated herein, the Bureau of the Mint buildings and grounds shall be referred to in these regulations as the “property”.
Except as otherwise ordered, the property shall be closed to the public during other than normal working hours. The property shall also be closed to the public when, in the opinion of the senior supervising official of any Bureau of the Mint establishment covered by these regulations, or his delegate, an emergency situation exists, and at such other times as may be necessary for the orderly conduct of the Government's business. Admission to the property during periods when such property is closed to the public will be limited to authorized individuals who will be required to sign the register and/or display identification documents when requested by the guard.
It shall be unlawful for any person without proper authority to wilfully destroy, damage, deface, or remove property or any part thereof or any furnishings therein.
Persons in and on the property shall comply with the instructions of uniformed Bureau of the Mint guards (U.S. Special Policemen), other authorized officials, and official signs of a prohibitory or directory nature.
The use of loud, abusive, or profane language, unwarranted loitering, unauthorized assembly, the creation of any hazard to persons or things, improper disposal of rubbish, spitting, prurient prying, the commission of any obscene or indecent act, or any other disorderly conduct on the property is prohibited. The throwing of any articles of any kind in, upon, or from the property and climbing upon any part thereof, is prohibited. The entry, without specific permission, upon any part of the property to which the public does not customarily have access, is prohibited.
(a) Participating in games for money or other property, the operation of gambling devices, the conduct of a lottery or pool, the selling or purchasing of numbers tickets, or any other gambling in or on the property, is prohibited.
(b) Possession in or on the property of any numbers slip or ticket, record, notation, receipt, or other writing of a type ordinarily used in any illegal form of gambling such as a tip sheet or dream book, unless explained to the satisfaction of the head of the bureau or his delegate, shall be prima facie evidence that there is participation in an illegal form of gambling in or on such property.
Entering or being on the property, or operating a motor vehicle thereon by a person under the influence of alcoholic beverages, narcotics, hallucinogenic or dangerous drugs is prohibited. The use of any narcotic, hallucinogenic or dangerous drug in or on the property is prohibited. The use of alcoholic beverages in or on the property is prohibited except on occasions and on property upon which the Director of the Mint has for appropriate official uses granted and exemption permit in writing.
The unauthorized soliciting of alms and contributions, the commercial soliciting and vending of all kinds, the display or distribution of commercial advertising, or the collecting of private debts, in or on the property, is prohibited. This rule does not apply to Bureau of the Mint concessions or notices posted by authorized employees on the bulletin boards. Distribution of material such as pamphlets, handbills, and flyers is prohibited without prior approval from the Director of the Mint, or the delegate of the Director.
The taking of photographs on the property is prohibited, without the written permission of the Director of the Mint.
Dogs and other animals, except seeing-eye dogs, shall not be brought upon the property for other than official purposes.
(a) Drivers of all vehicles in or on the property shall drive in a careful and safe manner at all times and shall comply with the signals and directions of guards and all posted traffic signs.
(b) The blocking of entrances, driveways, walks, loading platforms, or fire hydrants in or on the property is prohibited.
(c) Parking in or on the property is not allowed without a permit or specific authority. Parking without authority, parking in unauthorized locations or in locations reserved for other persons or continuously in excess of 8 hours without permission, or contrary to the direction of a uniformed Bureau of the Mint guard, or of posted signs, is prohibited.
(d) This paragraph may be supplemented from time to time with the approval of the Director of the Mint, or the delegate of the Director, by the issuance and posting of such specific traffic directives as may be required and when so issued and posted such directives shall have the same force and effect as if made a part hereof.
No person while on the property shall carry firearms, other dangerous or deadly weapons, or explosives, either openly or concealed, except for official purposes.
Whoever shall be found guilty of violating any of the regulations in this part while on the property is subject to a fine of not more than $50, or imprisonment of not more than 30 days, or both (40 U.S.C. 318c). Nothing contained in the regulations in this part shall be construed to abrogate any other Federal laws or regulations or those of any State or municipality applicable to the property referred to in § 91.2 and governed by the regulations in this part.
5 U.S.C. 301.
With the approval of the Director of the Mint, dies for medals of a national character designated by Congress may be executed at the Philadelphia Mint, and struck in such field office of the Mints and Assay Offices as the Director shall designate.
Medals on the regular Mint list, when available, are sold to the public at a charge sufficient to cover their cost, and to include mailing cost when mailed. Copies of the list of medals available for sale and their selling prices may be obtained from the Director of the Mint, Washington, DC.
“Proof” coins, i.e., coins prepared from blanks specially polished and struck, are made as authorized by the Director of the Mint and are sold at a price sufficient to cover their face value plus the additional expense of their manufacture and sale. Their manufacture and issuance are contingent upon the demands of regular operations. Information concerning availability and price may be obtained from the Director of the Mint, Treasury Department, Washington, DC 20220.
Uncirculated Mint Sets, i.e., specially packaged coin sets containing one coin of each denomination struck at the Mints at Philadelphia and Denver, and the Assay Office at San Francisco, will be made as authorized by the Director of the Mint and will be sold at a price sufficient to cover their
(a)
(b)
(c)
Any person denied access to records requested under § 92.5 may file an appeal to the Director of the Mint within 30 days after notification of such denial. The appeal shall provide the name and address of the appellant, the identification of the record denied, and the date of the original request and its denial.
Sec. 1, 49 Stat. 938; 31 U.S.C. 773a.
The regulations in this part govern the exchange of the coin and paper currency of the United States (including national bank notes and Federal Reserve bank notes in process of retirement and Federal Reserve notes). Under authorization in the Act approved May 29, 1920, 41 Stat. 655 (31
The official agencies of the Department of the Treasury will continue to exchange lawfully held coins and currencies of the United States, dollar for dollar, for other coins and currencies which may be lawfully acquired and are legal tender for public and private debts. Paper currency of the United States which has been falsely altered and coins altered to render them for use as other denominations will not be redeemed since such currency and coins are subject to forfeiture under Title 18, United States Code, section 492. Persons receiving such currency and coins should notify immediately the nearest local office of the U.S. Secret Service of the Department of the Treasury, and hold the same pending advice from the Service.
Gold coins, and gold certificates of the type issued before January 30, 1934, are exchangeable, as provided in this part, into other currency or coin which may be lawfully issued.
(a) Lawfully held paper currency of the United States which has been mutilated will be exchanged at face amount if clearly more than one-half of the original whole note remains. Fragments of such mutilated currency which are not clearly more than one-half of the original whole note will be exchanged at face value only if the Director, Bureau of Engraving and Printing, Department of the Treasury, is satisfied that the missing portions have been totally destroyed. The Director's judgment shall be based on such evidence of total destruction as is necessary and shall be final.
(1) Mutilated currency is currency which has been damaged to the extent that (i) one-half or less of the original note remains or (ii) its condition is such that its value is questionable and the currency must be forwarded to the Treasury Department for examination by trained experts before any exchange is made.
(2) Unfit currency is currency which is unfit for further circulation because of its physical condition such as torn, dirty, limp, worn or defaced. Unfit currency should not be forwarded to the Treasury, but may be exchanged at commercial banks.
No relief will be granted on account of lawfully held paper currency of the United States which has been totally destroyed.
(a) Payment will be made to lawful holders of mutilated currency at full value when:
(1) Clearly more than 50% of a note identifiable as United States currency is present; or
(2) Fifty percent or less of a note identifiable as United States currency is present and the method of mutilation and supporting evidence demonstrate to the satisfaction of the Treasury that the missing portions have been totally destroyed.
(b) No payments will be made when:
(1) Fragments and remnants presented are not identifiable as United States currency; or
(2) Fragments and remnants presented which represent 50% or less of a note are identifiable as United States currency but the method of destruction and supporting evidence do not satisfy the Treasury that the missing portion has been totally destroyed.
(c) All cases will be handled under proper procedures to safeguard the funds and interests of the claimant. In some cases, the amount repaid will be less than the amount claimed. In other cases, the amount repaid may be greater. The amount paid will be determined by an examination made by trained mutilated currency examiners and governed by the above criteria.
(d) The Director of the Bureau of Engraving and Printing shall have final authority with respect to settlements for mutilated currency claims.
Mutilated currency examiners are normally able to determine the value of mutilated currency when it has been carefully packed and boxed as described below:
(a) Regardless of the condition of the currency, do not disturb the fragments more than is absolutely necessary.
(b) If the currency is brittle or inclined to fall apart, pack it carefully in cotton and box it as found, without disturbing the fragments, if possible.
(c) If the money was in a purse, box, or other container when mutilated, it should be left therein, if possible, in order to prevent further deterioration of the fragments or from their being lost.
(d) If it is absolutely necessary to remove the fragments from the container, send the container with the currency and any other contents found, except as noted in paragraph (h) of this section.
(e) If the money was flat when mutilated, do not roll or fold.
(f) If the money was in a roll when mutilated, do not attempt to unroll or straighten.
(g) If coin or any other metal is mixed with the currency, remove carefully. Do not send coin or other metal in the same package with mutilated paper currency, as the metal will break up the currency. Coin should be forwarded as provided in § 100.12 (c) and (d).
(h) Any fused or melted coin should be sent to: Superintendent, United States Mint, P.O. Box 400, Philadelphia, PA 19105.
Mutilated currency shipments must be addressed as follows: Department of the Treasury, Bureau of Engraving and Printing, OCS, Room 344A, Post Office Box 37048, Washington, DC 20013.
(a)
(b)
(c)
(d)
(a)
(2) Partial coins are U.S. coins which are not whole; partial coins must be readily and clearly identifiable as to genuineness and denomination.
(b)
(c)
(a)
(2) Mixed coins are U.S. coins of several alloy categories which are presented together, but are readily and clearly identifiable as U.S. coins.
(b)
(i) The inventory value of the copper and nickel as priced in the Philadelphia Mint, Coinage Metal Account at the end of the preceding calendar quarter or;
(ii) $1.5327 per pound of contained copper, which is the face value equivalent of a pound of copper in the copper one-cent coin plus $18.1442 per pound of contained nickel which is the face value equivalent of a pound of nickel in the five cent coin.
(2) The redemption rate (discussed in subparagraph (1)(a)) will take effect on the 15th day of each new calendar quarter.
(c)
(2) Fused and mixed coins containing lead, solder, or other substance which will render them unsuitable for coinage metal will not be accepted.
(d)
Criminal penalties connected with the defacement or mutilation of U.S. coins are provided in the United States Code, Title 18, section 331.
Other than as provided in this document all transactions including the exchange of paper currency and coin shall be handled through the Federal Reserve banks and branches.
The Act of June 30, 1876 (19 Stat. 4; 31 U.S.C. 424), provides that all U.S. Officers charged with the receipt or disbursement of public moneys, and all officers of national banks, shall stamp or write in plain letters the word “counterfeit,” “altered,” or “worthless” upon all fraudulent notes issued in the form of, and intended to circulate as money, which shall be presented at their places of business; and if such officers shall wrongfully stamp any genuine note of the United States, or of the national bank, they shall, upon presentation, “redeem” such notes at the face amount thereof.
All counterfeit notes and coin found in remittances are cancelled and delivered to the U.S. Secret Service of the Department of the Treasury or to the nearest local office of that Service, a receipt for the same being forwarded to the sender. Communications with respect thereto should be addressed to the Director, U.S. Secret Service, Department of the Treasury, Washington, DC 20223.
18 U.S.C. 492.
The purpose of this part is to establish a policy whereby certain purchasers or holders of gold coins who have forfeited them to the United States because they were counterfeit may, in the discretion of the Secretary of the Treasury, recover the gold bullion from the coins. This part sets forth the procedures to be followed in implementing this policy.
(a)
(1) The petitioner innocently purchased or received the coins and held them without the knowledge that they were counterfeit; and,
(2) The petitioner voluntarily submitted the coins to the Treasury Department for a determination of whether they were legitimate or counterfeit; and,
(3) The coins were determined to be counterfeit and were seized by the Treasury Department and forfeited to the United States.
(b)
(c)
(1) The full name and address of the petitioner;
(2) A description of the coin or coins involved;
(3) The name and address of the person from whom the coins were received or purchased by the petitioner;
(4) The date and place where they were voluntarily submitted for examination;
(5) Any other circumstances relied upon by the petitioner to justify the mitigation;
(6) A statement that the petitioner purchased or received and held the coins without the knowledge that they were counterfeit.
(a) The Assistant Secretary will receive and review all petitions for mitigation of the forfeiture of counterfeit gold coins. He shall conduct such further investigation, and may request such further information from the petitioner as he deems necessary. Petitions will be approved if the Assistant Secretary determines that:
(1) The gold coins have not been previously disposed of by normal procedures;
(2) The petitioner was an innocent purchaser or holder of the gold coins and is not under investigation in connection with the coins at the time of submission or thereafter;
(3) The coins are not needed and will not be needed in the future in any investigation or as evidence in legal proceedings; and
(4) Mitigation of the forfeiture is in the best interest of the Government.
If the petition is approved, the Assistant Secretary shall then forward the gold coins to the Bureau of the Mint where, if economically feasible, the gold bullion will be extracted from the counterfeit coins. The Bureau of the Mint will then return the bullion to the Assistant Secretary.
The petitioner shall be required to pay all reasonable costs incurred in extracting the bullion from the counterfeit coins, as shall be determined by the Assistant Secretary. Payment must be made prior to the return of the gold bullion to the petitioner.
After receiving the gold bullion from the Bureau of the Mint, the Assistant Secretary shall notify the petitioner that his petition has been approved and that payment of the smelting costs in an amount set forth in such notice must be made prior to the return of the bullion.
The provisions of this part shall not apply where the cost of smelting the gold coins exceeds the value of the gold bullion to be returned.
The Secretary of the Treasury retains complete discretion to deny any claim of any petitioner when the Secretary believes it is not in the best interest of the Government to return the bullion to the petitioner or when the Secretary is not convinced that the petitoner was an innocent purchaser or holder without knowledge that the gold coins were counterfeit.
12 U.S.C. 1829b and 1951-1959; 31 U.S.C. 5311-5330.
When used in this part and in forms prescribed under this part, where not otherwise distinctly expressed or manifestly incompatible with the intent thereof, terms shall have the meanings ascribed in this section.
(a)
(b)
(1) That person either alone, in conjunction with or on behalf of others;
(2) Transports, mails, ships or receives in any manner; is about to transport, mail or ship in any manner; or causes the transportation, mailing, shipment or receipt in any manner of;
(3) Monetary instruments;
(4) Into the United States or out of the United States;
(5) Totaling more than $10,000;
(6)(i) On one calendar day or (ii) if for the purpose of evading the reporting requirements of § 103.23, on one or more days.
(c)
(1) A commercial bank or trust company organized under the laws of any State or of the United States;
(2) A private bank;
(3) A savings and loan association or a building and loan association organized under the laws of any State or of the United States;
(4) An insured institution as defined in section 401 of the National Housing Act;
(5) A savings bank, industrial bank or other thrift institution;
(6) A credit union organized under the law of any State or of the United States;
(7) Any other organization chartered under the banking laws of any State and subject to the supervision of the bank supervisory authorities of a State;
(8) A bank organized under foreign law;
(9) Any national banking association or corporation acting under the provisions of section 25(a) of the Act of Dec. 23, 1913, as added by the Act of Dec. 24, 1919, ch. 18, 41 Stat. 378, as amended (12 U.S.C. 611-32).
(d)
(e)
(f)
(g)
(h)
(i)
(j)
(k)
(l)
(m)
(n)
(1) A bank (except bank credit card systems);
(2) A broker or dealer in securities;
(3) A currency dealer or exchanger, including a person engaged in the business of a check casher;
(4) An issuer, seller, or redeemer of traveler's checks or money orders, except as a selling agent exclusively who does not sell more than $150,000 of such instruments within any given 30-day period;
(5) A licensed transmitter of funds, or other person engaged in the business of transmitting funds;
(6) A telegraph company;
(7)(i)
(ii) For purposes of this paragraph (i)(7), “gross annual gaming revenue” means the gross gaming revenue received by a casino, during either the previous business year or the current business year of the casino. A casino or gambling casino which is a casino for purposes of this part solely because its gross annual gaming revenue exceeds $1,000,000 during its current business year, shall not be considered a casino for purposes of this part prior to the time in its current business year that its gross annual gaming revenue exceeds $1,000,000.
(iii) Any reference in this part, other than in this paragraph (n)(7) and in paragraph (n)(8) of this section, to a casino shall also include a reference to a card club, unless the provision in question contains specific language varying its application to card clubs or excluding card clubs from its application.
(8)(i)
(ii) For purposes of this paragraph (n)(8),
(9) A person subject to supervision by any state or federal bank supervisory authority;.
(10) The United States Postal Service with respect to the sale of money orders.
(o)
(p)
(q)
(r)
(s)
(t)
(1) Is issued in bearer or registered form;
(2) Is of a type commonly dealt in upon securities exchanges or markets or commonly recognized in any area in which it is issued or dealt in as a medium for investment;
(3) Is either one of a class or series or by its terms is divisible into a class or series of instruments; and
(4) Evidences a share, participation or other interest in property or in an enterprise or evidences an obligation of the issuer.
(u)
(i) Currency;
(ii) Traveler's checks in any form;
(iii) All negotiable instruments (including personal checks, business checks, official bank checks, cashier's checks, third-party checks, promissory notes (as that term is defined in the Uniform Commercial Code), and money orders) that are either in bearer form, endorsed without restriction, made out to a fictitious payee (for the purposes of § 103.23), or otherwise in such form that title thereto passes upon delivery;
(iv) Incomplete instruments (including personal checks, business checks, official bank checks, cashier's checks, third-party checks, promissory notes (as that term is defined in the Uniform
(v) Securities or stock in bearer form or otherwise in such form that title thereto passes upon delivery.
(2) Monetary instruments do not include warehouse receipts or bills of lading.
(v)
(w)
(x)
(y)
(1) The instruction does not state a condition to payment to the beneficiary other than time of payment;
(2) The receiving bank is to be reimbursed by debiting an account of, or otherwise receiving payment from, the sender; and
(3) The instruction is transmitted by the sender directly to the receiving bank or to an agent, funds transfer system, or communication system for transmittal to the receiving bank.
(z)
(aa)
(bb)
(cc)
(dd)
(ee)
(ff)
(gg)
(hh)
(ii)
(2) For purposes of § 103.22, and other provisions of this part relating solely to the report required by that section, the term “transaction in currency” shall mean a transaction involving the physical transfer of currency from one person to another. A transaction which is a transfer of funds by means of bank check, bank draft, wire transfer, or other written order, and which does not include the physical transfer of currency, is not a transaction in currency for this purpose.
(jj)
(kk)
(1) The instruction does not state a condition to payment to the recipient other than time of payment;
(2) The receiving financial institution is to be reimbursed by debiting an account of, or otherwise receiving payment from, the sender; and
(3) The instruction is transmitted by the sender directly to the receiving financial institution or to an agent or communication system for transmittal to the receiving financial institution.
(ll)
(mm)
(nn)
(oo)
(pp)
(qq)
(rr)
(ss)
(tt)
At 63 FR 1923, Jan. 13, 1998, § 103.11 was amended by redesignating paragraphs (n)(8) and (n)(9) as (n)(9) and (n)(10), respectively, and adding new paragraphs (n)(7)(iii) and (n)(8), effective Aug. 1, 1998.
The Secretary hereby determines that the reports required by this subpart have a high degree of usefulness in criminal, tax, or regulatory investigations or proceedings.
(a)
(2) A transaction requires reporting under the terms of this section if it is conducted or attempted by, at, or through the bank, it involves or aggregates at least $5,000 in funds or other assets, and the bank knows, suspects, or has reason to suspect that:
(i) The transaction involves funds derived from illegal activities or is intended or conducted in order to hide or disguise funds or assets derived from illegal activities (including, without limitation, the ownership, nature, source, location, or control of such funds or assets) as part of a plan to violate or evade any federal law or regulation or to avoid any transaction reporting requirement under federal law or regulation;
(ii) The transaction is designed to evade any requirements of this part or of any other regulations promulgated under the Bank Secrecy Act, Pub. L. 91-508, as amended, codified at 12 U.S.C. 1829b, 12 U.S.C. 1951-1959, and 31 U.S.C. 5311-5330; or
(iii) The transaction has no business or apparent lawful purpose or is not the sort in which the particular customer would normally be expected to engage, and the bank knows of no reasonable explanation for the transaction after examining the available facts, including the background and possible purpose of the transaction.
(b)
(2)
(3)
(c)
(d)
(e)
(f)
(a)(1) Each financial institution other than a casino or the Postal Service shall file a report of each deposit, withdrawal, exchange of currency or other payment or transfer, by, through, or to such financial institution which involves a transaction in currency of more than $10,000. Transactions in currency by exempt persons with banks are not subject to this requirement to the extent provided in paragraph (h) of this section. Multiple currency transactions shall be treated as a single transaction if the financial institution has knowledge that they are by or on behalf of any person and result in either cash in or cash out totaling more than $10,000 during any one business day. Deposits made at night or over a weekend or holiday shall be treated as if received on the next business day following the deposit.
(2) Each casino shall file a report of each transaction in currency, involving either cash in or cash out, of more than $10,000.
(i) Transactions in currency involving cash in include, but are not limited to:
(A) Purchases of chips, tokens, and plaques;
(B) Front money deposits;
(C) Safekeeping deposits;
(D) Payments on any form of credit, including markers and counter checks;
(E) Bets of currency;
(F) Currency received by a casino for transmittal of funds through wire transfer for a customer;
(G) Purchases of a casino's check; and
(H) Exchanges of currency for currency, including foreign currency.
(ii) Transactions in currency involving cash out include, but are not limited to:
(A) Redemptions of chips, tokens, and plaques;
(B) Front money withdrawals;
(C) Safekeeping withdrawals;
(D) Advances on any form of credit, including markers and counter checks;
(E) Payments on bets, including slot jackpots;
(F) Payments by a casino to a customer based on receipt of funds through wire transfer for credit to a customer;
(G) Cashing of checks or other negotiable instruments;
(H) Exchanges of currency for currency, including foreign currency; and
(I) Reimbursements for customers’ travel and entertainment expenses by the casino.
(iii) Multiple currency transactions shall be treated as a single transaction if the casino has knowledge that they are by or on behalf of any person and result in either cash in or cash out totaling more than $10,000 during any gaming day. For purposes of this paragraph (a)(2), a casino shall be deemed to have the knowledge described in the preceding sentence, if: any sole proprietor, partner, officer, director, or employee of the casino, acting within the scope of his or her employment, has knowledge that such multiple currency transactions have occurred, including knowledge from examining the books, records, logs, information retained on magnetic disk, tape or other machine-readable media, or in any manual system, and similar documents and information, which the casino maintains pursuant to any law or regulation or within the ordinary course of its business, and which contain information that such multiple currency transactions have occurred.
(3) The Postal Service shall file a report of each cash purchase of postal money orders in excess of $10,000. Multiple cash purchases totaling more than $10,000 shall be treated as a single transaction if the Postal Service has knowledge that they are by or on behalf of any person during any one day.
(4) A financial institution includes all of its domestic branch offices for the purpose of this paragraph's reporting requirements.
(b) Except as otherwise directed in writing by the Assistant Secretary (Enforcement) or the Commissioner of Internal Revenue:
(1) This section shall not require reports:
(i) Of transactions with Federal Reserve Banks or Federal Home Loan banks;
(ii) Of transactions between domestic banks; or
(iii) By nonbank financial institutions of transactions with commercial banks (however, commercial banks must report such transactions with nonbank financial institutions).
(2) A bank may exempt from the reporting requirement of paragraph (a) of this section the following:
(i) Deposits or withdrawals of currency from an existing account by an established depositor who is a United States resident and operates a retail type of business in the United States. For the purpose of this subsection, a retail type of business is a business primarily engaged in providing goods to ultimate consumers and for which the business is paid in substantial portions by currency, except that dealerships which buy or sell motor vehicles, vessels, or aircraft are not included and their transactions may not be exempted from the reporting requirements of this section.
(ii) Deposits or withdrawals of currency from an existing account by an established depositor who is a United States resident and operates a sports arena, race track, amusement park, bar, restaurant, hotel, check cashing
(iii) Deposits or withdrawals, exchanges of currency or other payments and transfers by local or state governments, or the United States or any of its agencies or instrumentalities.
(iv) Withdrawals for payroll purposes from an existing account by an established depositor who is a United States resident and operates a firm that regularly withdraws more than $10,000 in order to pay its employees in currency.
(c) In each instance the transactions exempted under paragraph (b) of this section must be in amounts which the bank may reasonably conclude do not exceed amounts commensurate with the customary conduct of the lawful, domestic business of that customer, or in the case of transactions with a local or state government or the United States or any of its agencies or instrumentalities, in amounts which are customary and commensurate with the authorized activities of the agency or instrumentality. This section does not permit a bank to exempt its transactions with nonbank financial institutions (except for check cashing services licensed by state or local governments and the United States Postal Service) nor will additional exemption authority be granted for such transaction (except transactions by other check cashers).
(d) After October 27, 1986, a bank may not place any customer on its exempt list without first preparing a written statement, signed by the customer, describing the customary conduct of the lawful domestic business of that customer and a detailed statement of reasons why such person is qualified for an exemption. The statement shall include the name, address, nature of business, taxpayer identification number, and account number of the customer being exempted. The signature, including the title and position of the person signing, will attest to the accuracy of the information concerning the name, address, nature of business, and tax identification number of the customer. Immediately above the signature line, the following statement shall appear:
“The information contained above is true and correct to the best of my knowledge and belief. I understand that this information will be read and relied upon by the Government.”
(e) A bank may apply to the Commissioner of Internal Revenue for additional authority to grant an exemption to the reporting requirement, not otherwise permitted under paragraph (b) of this section, if the bank believes that circumstances warrant such an exemption. Such requests shall be addressed to: Chief, Currency and Banking Reports Branch, Compliance Review Group, IRS Data Center, Post Office Box 32063, Detroit, Michigan 48232, and must be accompanied by a statement of the circumstances that warrant special exemption treatment and a copy of the statement signed by the customer required by paragraph (d) of this section.
(f) A record of each exemption granted under this section and the reason therefor must be kept in a centralized list. The record shall include the names and addresses of all banks referred to in paragraph (b)(1)(ii) of this section, as well as the name, address, business, taxpayer identification number and account number of each depositor that has engaged in currency transactions which have not been reported because
(g) Upon the request of the Assistant Secretary (Enforcement) or the Commissioner of Internal Revenue, a bank shall provide a report containing the list of the bank's customers whose transactions have been exempted under this section and such related information as the Assistant Secretary or Commissioner shall require, including copies of the statements required in paragraph (d) of this section. The report must be provided within 15 days of the request. Any exemption may be rescinded at the discretion of the requesting official, who may require the bank to file reports required by paragraph (a) of this section with respect to future transactions of any customer whose transactions previously were exempted.
(h)
(2)
(i) A bank, to the extent of such bank's domestic operations;
(ii) A department or agency of the United States, of any state, or of any political subdivision of any state;
(iii) Any entity established under the laws of the United States, of any state, or of any political subdivision of any state, or under an interstate compact between two or more states, that exercises governmental authority on behalf of the United States or any such state or political subdivision;
(iv) Any entity, other than a bank, whose common stock or analogous equity interests are listed on the New York Stock Exchange or the American Stock Exchange or whose common stock or analogous equity interests have been designated as a Nasdaq National Market Security listed on the Nasdaq Stock Market (except stock or interests listed under the separate “Nasdaq Small-Cap Issues” heading);
(v) Any subsidiary, other than a bank, of any entity described in paragraph (h)(2)(iv) of this section (a “listed entity”) that is organized under the laws of the United States or of any state and at least 51 per cent of whose common stock is owned by the listed entity; and
(vi) Notwithstanding paragraphs (h)(2)(iv) and (h)(2)(v) of this section, any financial institution other than a bank, that is an entity described in paragraph (h)(2)(iv) or (h)(2)(v) of this section, to the extent to such financial institution's domestic operations.
(3)
(ii) Except where the person sought to be exempted is another bank as described in paragraph (h)(2)(i) of this section, designation of an exempt person shall be made by a single filing of Internal Revenue Service Form 4789, in which line 36 is marked “Designation of Exempt Person” and items 2-14 (Part I, Section A) and items 37-49 (Part III) are completed, or by filing any form specifically designated by FinCEN for this purpose. The designation must be made separately by each bank that treats the person in question as an exempt person.
(iii) When designating another bank as an exempt person, a bank must make either the filing as described in paragraph (h)(3)(ii) of this section or file, in such a format and manner as FinCEN may specify, a current list of its domestic bank customers. In the event that a bank files its current list of domestic bank customers, the bank must make the filing as described in paragraph (h)(3)(ii) of this section for each bank that is a new customer and for which an exemption is sought under this paragraph (h).
(iv) The designation requirements set forth in this paragraph (h)(3) apply whether or not the particular exempt person to be designated has previously been treated as exempt from the reporting requirements of section 103.22(a) under the rules contained in paragraph (b) or (e) of this section.
(4)
(ii) A bank may treat a person as a governmental department, agency, or entity if the name of such person reasonably indicates that it is described in paragraph (h)(2)(ii) or (h)(2)(iii) of this section, or if such person is known generally in the community to be a State, the District of Columbia, a tribal government, a Territory or Insular Possession of the United States, or a political subdivision or a wholly-owned agency or instrumentality of any of the foregoing. An entity generally exercises governmental authority on behalf of the United States, a State, or a political subdivision, for purposes of paragraph (h)(2)(iii) of this section, only if its authorities include one or more of the powers to tax, to exercise the authority of eminent domain, or to exercise police powers with respect to matters within its jurisdiction. Examples of entities that exercise governmental authority include, but are not limited to, the New Jersey Turnpike Authority and the Port Authority of New York and New Jersey.
(iii) In determining whether a person is described in paragraph (h)(2)(iv) of this section, a bank may rely on any New York, American or Nasdaq Stock Market listing published in a newspaper of general circulation, or any commonly accepted or published stock symbol guide, on any information contained on the Securities and Exchange Commission “Edgar” System, or on any information contained in an Internet World-Wide Web site or sites maintained by the New York Stock Exchange, the American Stock Exchange, or the National Association of Securities Dealers.
(iv) In determining whether a person is described in paragraph (h)(2)(v) of this section, a bank may rely upon:
(A) Any reasonably authenticated corporate officer's certificate;
(B) Any reasonably authenticated photocopy of Internal Revenue Service Form 851 (Affiliation Schedule) or the equivalent thereof for the appropriate tax year; or
(C) A person's Annual Report or Form 10-K, as filed in each case with the Securities and Exchange Commission.
(v) The records maintained by a bank to document its compliance with and administration of the rules of this paragraph (h) shall be kept in accordance with the provisions of section 103.38.
(5)
(6)
(A) Knowingly files false or incomplete information with respect to the transaction or the customer engaging in the transaction; or
(B) Has reason to believe that the customer does not meet the criteria established by this paragraph (h) for treatment of the transactor as an exempt person or that the transaction is not a transaction of the exempt person.
(ii) Absent specific knowledge of any information that would be grounds for revocation as provided in paragraph (h)(8) of this section, a bank is required to verify the status of those entities it
(iii) A bank that files a report with respect to a currency transaction by an exempt person rather than treating such person as exempt shall remain subject, with respect to each such report, to the rules for filing reports, and the penalties for filing false or incomplete reports that are applicable to reporting of transactions in currency by persons other than exempt persons. A bank that continues to treat a person described in paragraph (h)(2) as exempt from the reporting requirements of section 103.22(a) on a basis other than as provided in this paragraph (h) shall remain subject to the rules governing an exemption on such other basis and to the penalties for failing to comply with the rules governing such other exemption.
(7)
(8)
(i) The status of an entity as an exempt person under paragraph (h)(2)(iv) of this section ceases once such entity ceases to be listed on the applicable stock exchange; and
(ii) The status of a subsidiary as an exempt person under paragraph (h)(2)(v) of this section ceases once such subsidiary ceases to have at least 51 per cent of its common stock owned by a listed entity.
(9)
(a) Each person who physically transports, mails, or ships, or causes to be physically transported, mailed, or shipped, or attempts to physically transport, mail or ship, or attempts to cause to be physically transported, mailed or shipped, currency or other monetary instruments in an aggregate amount exceeding $10,000 at one time from the United States to any place outside the United States, or into the United States from any place outside the United States, shall make a report thereof. A person is deemed to have caused such transportation, mailing or shipping when he aids, abets, counsels, commands, procures, or requests it to be done by a financial institution or any other person.
(b) Each person who receives in the U.S. currency or other monetary instruments in an aggregate amount exceeding $10,000 at one time which have been transported, mailed, or shipped to such person from any place outside the United States with respect to which a report has not been filed under paragraph (a) of this section, whether or not required to be filed thereunder, shall make a report thereof, stating the amount, the date of receipt, the form of monetary instruments, and the person from whom received.
(c) This section shall not require reports by:
(1) A Federal Reserve;
(2) A bank, a foreign bank, or a broker or dealer in securities, in respect to currency or other monetary instruments mailed or shipped through the postal service or by common carrier;
(3) A commercial bank or trust company organized under the laws of any State or of the United States with respect to overland shipments of currency or monetary instruments shipped to or received from an established customer maintaining a deposit relationship with the bank, in amounts which the bank may reasonably conclude do not exceed amounts commensurate with the customary conduct of the business, industry or profession of the customer concerned;
(4) A person who is not a citizen or resident of the United States in respect to currency or other monetary instruments mailed or shipped from abroad to a bank or broker or dealer in securities through the postal service or by common carrier;
(5) A common carrier of passengers in respect to currency or other monetary instruments in the possession of its passengers;
(6) A common carrier of goods in respect to shipments of currency or monetary instruments not declared to be such by the shipper;
(7) A travelers’ check issuer or its agent in respect to the transportation of travelers’ checks prior to their delivery to selling agents for eventual sale to the public;
(8) By a person with respect to a restrictively endorsed traveler's check that is in the collection and reconciliation process after the traveler's check has been negotiated,
(9) Nor by a person engaged as a business in the transportation of currency, monetary instruments and other commercial papers with respect to the transportation of currency or other monetary instruments overland between established offices of banks or brokers or dealers in securities and foreign persons.
(d) A transfer of funds through normal banking procedures which does not involve the physical transportation of currency or monetary instruments is not required to be reported by this section. This section does not require that more than one report be filed covering a particular transportation, mailing or shipping of currency or other monetary instruments with respect to which a complete and truthful report has been filed by a person. However, no person required by paragraph (a) or (b) of this section to file a report shall be excused from liability for failure to do so if, in fact, a complete and truthful report has not been filed.
(a) Each person subject to the jurisdiction of the United States (except a foreign subsidiary of a U.S. person) having a financial interest in, or signature or other authority over, a bank, securities or other financial account in a foreign country shall report such relationship to the Commissioner of the Internal Revenue for each year in which such relationship exists, and shall provide such information as shall be specified in a reporting form prescribed by the Secretary to be filed by such persons. Persons having a financial interest in 25 or more foreign financial accounts need only note that fact on the form. Such persons will be required to provide detailed information concerning each account when so requested by the Secretary or his delegate.
(a)
(b)
(1) Checks or drafts, including traveler's checks, received by respondent financial institution for collection or credit to the account of a foreign financial agency, sent by respondent financial institution to a foreign country for collection or payment, drawn by respondent financial institution on a foreign financial agency, drawn by a foreign financial agency on respondent financial institution—including the following information.
(i) Name of maker or drawer;
(ii) Name of drawee or drawee financial institution;
(iii) Name of payee;
(iv) Date and amount of instrument;
(v) Names of all endorsers.
(2) Transmittal orders received by a respondent financial institution from a foreign financial agency or sent by respondent financial institution to a foreign financial agency, including all information maintained by that institution pursuant to § 103.33.
(3) Loans made by respondent financial institution to or through a foreign financial agency—including the following information:
(i) Name of borrower;
(ii) Name of person acting for borrower;
(iii) Date and amount of loan;
(iv) Terms of repayment;
(v) Name of guarantor;
(vi) Rate of interest;
(vii) Method of disbursing proceeds;
(viii) Collateral for loan.
(4) Commercial paper received or shipped by the respondent financial institution—including the following information:
(i) Name of maker;
(ii) Date and amount of paper;
(iii) Due date;
(iv) Certificate number;
(v) Amount of transaction.
(5) Stocks received or shipped by respondent financial institution—including the following information:
(i) Name of corporation;
(ii) Type of stock;
(iii) Certificate number;
(iv) Number of shares;
(v) Date of certificate;
(vi) Name of registered holder;
(vii) Amount of transaction.
(6) Bonds received or shipped by respondent financial institution—including the following information:
(i) Name of issuer;
(ii) Bond number;
(iii) Type of bond series;
(iv) Date issued;
(v) Due date;
(vi) Rate of interest;
(vii) Amount of transaction;
(viii) Name of registered holder.
(7) Certificates of deposit received or shipped by respondent financial institution—including the following information:
(i) Name and address of issuer;
(ii) Date issued;
(iii) Dollar amount;
(iv) Name of registered holder;
(v) Due date;
(vi) Rate of interest;
(vii) Certificate number;
(viii) Name and address of issuing agent.
(c)
(1) A reasonable classification of financial institutions subject to or exempt from a reporting requirement;
(2) A foreign country to which a reporting requirement applies if the Secretary decides that applying the requirement to all foreign countries is unnecessary or undesirable;
(3) The magnitude of transactions subject to a reporting requirement; and
(4) The kind of transaction subject to or exempt from a reporting requirement.
(d)
(e)
(2) The Secretary shall not issue a regulation under paragraph (a) of this section for the purpose of obtaining individually identifiable account information concerning a customer, as defined by the Right to Financial Privacy Act (12 U.S.C. 3401
(3) The Secretary may issue a regulation pursuant to paragraph (a) of this section requiring a financial institution to report transactions completed prior to the date it received notice of the reporting requirement. However, with respect to completed transactions, a financial institution may be required to provide information only from records required to be maintained pursuant to Subpart C of this part, or any other provision of state or Federal law, or otherwise maintained in the regular course of business.
(a) If the Secretary of the Treasury finds, upon the Secretary's own initiative or at the request of an appropriate Federal or State law enforcement official, that reasonable grounds exist for concluding that additional recordkeeping and/or reporting requirements are necessary to carry out the purposes of this part and to prevent persons from evading the reporting/recordkeeping requirements of this part, the Secretary may issue an order requiring any domestic financial institution or group of domestic financial institutions in a geographic area and any other person participating in the type of transaction to file a report in the manner and to the extent specified in such order. The order shall contain such information as the Secretary may describe concerning any transaction in which such financial institution is involved for the payment, receipt, or transfer of United States coins or currency (or such other monetary instruments as the Secretary may describe in such order) the total amounts or denominations of which are equal to or greater than an amount which the Secretary may prescribe.
(b) An order issued under paragraph (a) of this section shall be directed to the Chief Executive Officer of the financial institution and shall designate one or more of the following categories of information to be reported: Each deposit, withdrawal, exchange of currency or other payment or transfer, by, through or to such financial institution specified in the order, which involves all or any class of transactions in currency and/or monetary instruments equal to or exceeding an amount to be specified in the order.
(c) In issuing an order under paragraph (a) of this section, the Secretary will prescribe:
(1) The dollar amount of transactions subject to the reporting requirement in the order;
(2) The type of transaction or transactions subject to or exempt from a reporting requirement in the order;
(3) The appropriate form for reporting the transactions required in the order;
(4) The address to which reports required in the order are to be sent or from which they will be picked up;
(5) The starting and ending dates by which such transactions specified in the order are to be reported;
(6) The name of a Treasury official to be contacted for any additional information or questions;
(7) The amount of time the reports and records of reports generated in response to the order will have to be retained by the financial institution; and
(8) Any other information deemed necessary to carry out the purposes of the order.
(d)(1) No order issued pursuant to paragraph (a) of this section shall prescribe a reporting period of more than 60 days unless renewed pursuant to the requirements of paragraph (a).
(2) Any revisions to an order issued under this section will not be effective until made in writing by the Secretary.
(3) Unless otherwise specified in the order, a bank receiving an order under this section may continue to use the exemptions granted under § 103.22 of this part prior to the receipt of the order, but may not grant additional exemptions.
(4) For purposes of this section, the term
(a)(1) A report required by § 103.22(a) shall be filed by the financial institution within 15 days following the day on which the reportable transaction occurred.
(2) A report required by § 103.22(g) shall be filed by the bank within 15 days after receiving a request for the report.
(3) A copy of each report filed pursuant to §103.22 shall be retained by the financial institution for a period of five years from the date of the report.
(4) All reports required to be filed by § 103.22 shall be filed with the Commissioner of Internal Revenue, unless otherwise specified.
(b)(1) A report required by § 103.23(a) shall be filed at the time of entry into the United States or at the time of departure, mailing or shipping from the United States, unless otherwise specified by the Commissioner of Customs.
(2) A report required by § 103.23(b) shall be filed within 15 days after receipt of the currency or other monetary instruments.
(3) All reports required by § 103.23 shall be filed with the Customs officer in charge at any port of entry or departure, or as otherwise specified by the Commissioner of Customs. Reports required by § 103.23(a) for currency or other monetary instruments not physically accompanying a person entering or departing from the United States, may be filed by mail on or before the date of entry, departure, mailing or shipping. All reports required by § 103.23(b) may also be filed by mail. Reports filed by mail shall be addressed to the Commissioner of Customs, Attention: Currency Transportation Reports, Washington, DC 20229.
(c) Reports required to be filed by § 103.24 shall be filed with the Commissioner of Internal Revenue on or before June 30 of each calendar year with respect to foreign financial accounts exceeding $10,000 maintained during the previous calendar year.
(d) Reports required by § 103.22, § 103.23 or § 103.24 shall be filed on forms prescribed by the Secretary. All information called for in such forms shall be furnished.
(e) Forms to be used in making the reports required by §§ 103.22 and 103.24 may be obtained from the Internal Revenue Service. Forms to be used in making the reports required by § 103.23
Before concluding any transaction with respect to which a report is required under § 103.22, a financial institution shall verify and record the name and address of the individual presenting a transaction, as well as record the identity, account number, and the social security or taxpayer identification number, if any, of any person or entity on whose behalf such transaction is to be effected. Verification of the identity of an individual who indicates that he or she is an alien or is not a resident of the United States must be made by passport, alien identification card, or other official document evidencing nationality or residence (
(a) No financial institution may issue or sell a bank check or draft, cashier's check, money order or traveler's check for $3,000 or more in currency unless it maintains records of the following information, which must be obtained for each issuance or sale of one or more of these instruments to any individual purchaser which involves currency in amounts of $3,000-$10,000 inclusive:
(1) If the purchaser has a deposit account with the financial institution:
(i)(A) The name of the purchaser;
(B) The date of purchase;
(C) The type(s) of instrument(s) purchased;
(D) The serial number(s) of each of the instrument(s) purchased; and
(E) The amount in dollars of each of the instrument(s) purchased.
(ii) In addition, the financial institution must verify that the individual is a deposit accountholder or must verify the individual's identity. Verification may be either through a signature card or other file or record at the financial institution provided the deposit accountholder's name and address were verified previously and that information was recorded on the signature card or other file or record; or by examination of a document which is normally acceptable within the banking community as a means of identification when cashing checks for nondepositors and which contains the name and address of the purchaser. If the deposit accountholder's identity has not been verified previously, the financial institution shall verify the deposit accountholder's identity by examination of a document which is normally acceptable within the banking community as a means of identification when cashing checks for nondepositors and which contains the name and address of the purchaser, and shall record the specific identifying information (
(2) If the purchaser does not have a deposit account with the financial institution:
(i)(A) The name and address of the purchaser;
(B) The social security number of the purchaser, or if the purchaser is an alien and does not have a social security number, the alien identification number;
(C) The date of birth of the purchaser;
(D) The date of purchase;
(E) The type(s) of instrument(s) purchased;
(F) The serial number(s) of the instrument(s) purchased; and
(G) The amount in dollars of each of the instrument(s) purchased.
(ii) In addition, the financial institution shall verify the purchaser's name and address by examination of a document which is normally acceptable within the banking community as a means of identification when cashing checks for nondepositors and which contains the name and address of the purchaser, and shall record the specific identifying information (
(b) Contemporaneous purchases of the same or different types of instruments totaling $3,000 or more shall be treated as one purchase. Multiple purchases during one business day totaling $3,000 or more shall be treated as one purchase if an individual employee, director, officer, or partner of the financial institution has knowledge that these purchases have occurred.
(c) Records required to be kept shall be retained by the financial institution for a period of five years and shall be made available to the Secretary upon request at any time.
The Secretary hereby determines that the records required to be kept by this subpart have a high degree of usefulness in criminal, tax, or regulatory investigations or proceedings.
Records of accounts required by § 103.24 to be reported to the Commissioner of Internal Revenue shall be retained by each person having a financial interest in or signature or other authority over any such account. Such records shall contain the name in which each such account is maintained, the number or other designation of such account, the name and address of the foreign bank or other person with whom such account is maintained, the type of such account, and the maximum value of each such account during the reporting period. Such records shall be retained for a period of 5 years and shall be kept at all times available for inspection as authorized by law. In the computation of the period of 5 years, there shall be disregarded any period beginning with a date on which the taxpayer is indicted or information instituted on account of the filing of a false or fraudulent Federal income tax return or failing to file a Federal income tax return, and ending with the date on which final disposition is made of the criminal proceeding.
Each financial institution shall retain either the original or a microfilm or other copy or reproduction of each of the following:
(a) A record of each extension of credit in an amount in excess of $10,000, except an extension of credit secured by an interest in real property, which record shall contain the name and address of the person to whom the extension of credit is made, the amount thereof, the nature or purpose thereof, and the date thereof;
(b) A record of each advice, request, or instruction received or given regarding any transaction resulting (or intended to result and later canceled if such a record is normally made) in the
(c) A record of each advice, request, or instruction given to another financial institution or other person located within or without the United States, regarding a transaction intended to result in the transfer of funds, or of currency, other monetary instruments, checks, investment securities, or credit, of more than $10,000 to a person, account or place outside the United States.
(d) A record of such information for such period of time as the Secretary may require in an order issued under § 103.26(a), not to exceed five years.
(e)
(1)
(A) The name and address of the originator;
(B) The amount of the payment order;
(C) The execution date of the payment order;
(D) Any payment instructions received from the originator with the payment order;
(E) The identity of the beneficiary's bank; and
(F) As many of the following items as are received with the payment order:
(
(
(
(ii) For each payment order that it accepts as an intermediary bank, a bank shall retain either the original or a microfilm, other copy, or electronic record of the payment order.
(iii) For each payment order that it accepts as a beneficiary's bank, a bank shall retain either the original or a microfilm, other copy, or electronic record of the payment order.
(2)
(i) If the payment order is made in person, prior to acceptance the originator's bank shall verify the identity of the person placing the payment order. If it accepts the payment order, the originator's bank shall obtain and retain a record of the name and address, the type of identification reviewed, the number of the identification document (
(ii) If the payment order accepted by the originator's bank is not made in person, the originator's bank shall obtain and retain a record of name and address of the person placing the payment order, as well as the person's taxpayer identification number (
(3)
(i) if the proceeds are delivered in person to the beneficiary or its representative or agent, the beneficiary's bank shall verify the identity of the person receiving the proceeds and shall obtain and retain a record of the name and address, the type of identification reviewed, and the number of the identification document (
(ii) if the proceeds are delivered other than in person, the beneficiary's bank shall retain a copy of the check or other instrument used to effect payment, or the information contained thereon, as well as the name and address of the person to which it was sent.
(4)
(5)
(6)
(i) Funds transfers where the originator and beneficiary are any of the following:
(A) A bank;
(B) A wholly-owned domestic subsidiary of a bank chartered in the United States;
(C) A broker or dealer in securities;
(D) A wholly-owned domestic subsidiary of a broker or dealer in securities;
(E) The United States;
(F) A state or local government; or
(G) A federal, state or local government agency or instrumentality; and
(ii) Funds transfers where both the originator and the beneficiary are the same person and the originator's bank and the beneficiary's bank are the same bank.
(f)
(1)
(A) The name and address of the transmittor;
(B) The amount of the transmittal order;
(C) The execution date of the transmittal order;
(D) Any payment instructions received from the transmittor with the transmittal order;
(E) The identity of the recipient's financial institution;
(F) As many of the following items as are received with the transmittal order:
(
(
(
(G) Any form relating to the transmittal of funds that is completed or signed by the person placing the transmittal order.
(ii) For each transmittal order that it accepts as an intermediary financial institution, a financial institution shall retain either the original or a microfilm, other copy, or electronic record of the transmittal order.
(iii) for each transmittal order that it accepts as a recipient's financial institution, a financial institution shall retain either the original or a microfilm, other copy, or electronic record of the transmittal order.
(2)
(i) If the transmittal order is made in person, prior to acceptance the transmittor's financial institution shall verify the identity of the person placing the transmittal order. If it accepts the transmittal order, the transmittor's financial institution shall obtain and retain a record of the name and address, the type of identification reviewed, and the number of the identification document (
(ii) If the transmittal order accepted by the transmittor's financial institution is not made in person, the
(3)
(i) If the proceeds are delivered in person to the recipient or its representative or agent, the recipient's financial institution shall verify the identity of the person receiving the proceeds and shall obtain and retain a record of the name and address, the type of identification reviewed, and the number of the identification document (
(ii) If the proceeds are delivered other than in person, the recipient's financial institution shall retain a copy of the check or other instrument used to effect payment, or the information contained thereon, as well as the name and address of the person to which it was sent.
(4)
(5)
(6)
(i) Transmittals of funds where the transmittor and the recipient are any of the following:
(A) A bank;
(B) A wholly-owned domestic subsidiary of a bank chartered in the United States;
(C) A broker or dealer in securities;
(D) A wholly-owned domestic subsidiary of a broker or dealer in securities;
(E) The United States;
(F) A state or local government; or
(G) A federal, state or local government agency or instrumentality; and
(ii) Transmittals of funds where both the transmittor and the recipient are the same person and the transmittor's financial institution and the recipient's financial institution are the same broker or dealer in securities.
(g) Any transmittor's financial institution or intermediary financial institution located within the United States shall include in any transmittal order for a transmittal of funds in the amount of $3,000 or more, information as required in this paragraph (g):
(1) A transmittor's financial institution shall include in a transmittal order, at the time it is sent to a receiving financial institution, the following information:
(i) The name and, if the payment is ordered from an account, the account number of the transmittor;
(ii) The address of the transmittor, except for a transmittal order through Fedwire until such time as the bank that sends the order to the Federal Reserve Bank completes its conversion to the expanded Fedwire format;
(iii) The amount of the transmittal order;
(iv) The execution date of the transmittal order;
(v) The identity of the recipient's financial institution;
(vi) As many of the following items as are received with the transmittal order:
(A) The name and address of the recipient;
(B) The account number of the recipient;
(C) Any other specific identifier of the recipient; and
(vii) Either the name and address or numerical identifier of the transmittor's financial institution.
(2) A receiving financial institution that acts as an intermediary financial institution, if it accepts a transmittal order, shall include in a corresponding transmittal order at the time it is sent to the next receiving financial institution, the following information, if received from the sender:
(i) The name and the account number of the transmittor;
(ii) The address of the transmittor, except for a transmittal order through Fedwire until such time as the bank that sends the order to the Federal Reserve Bank completes its conversion to the expanded Fedwire format;
(iii) The amount of the transmittal order;
(iv) The execution date of the transmittal order;
(v) The identity of the recipient's financial institution;
(vi) As many of the following items as are received with the transmittal order:
(A) The name and address of the recipient;
(B) The account number of the recipient;
(C) Any other specific identifier of the recipient; and
(vii) Either the name and address or numerical identifier of the transmittor's financial institution.
(3)
(i)
(A) Includes in the transmittal order, at the time it is sent to the receiving financial institution, the information specified in paragraphs (g)(1)(iii) through (v), and the information specified in paragraph (g)(1)(vi) of this section to the extent that such information has been received by the financial institution, and
(B) Provides the information specified in paragraphs (g)(1)(i), (ii) and (vii) of this section to a financial institution that acted as an intermediary financial institution or recipient's financial institution in connection with the transmittal order, within a reasonable time after any such financial institution makes a request therefor in connection with the requesting financial institution's receipt of a lawful request for such information from a federal, state, or local law enforcement or financial regulatory agency, or in connection with the requesting financial institution's own Bank Secrecy Act compliance program.
(ii)
(A) Includes in the transmittal order, at the time it is sent to the receiving financial institution, the information specified in paragraphs (g)(2)(iii) through (g)(2)(vi) of this section, to the extent that such information has been received by the intermediary financial institution; and
(B) Provides the information specified in paragraphs (g)(2)(i), (ii) and (vii) of this section, to the extent that such information has been received by the intermediary financial institution, to a financial institution that acted as an intermediary financial institution or recipient's financial institution in connection with the transmittal order, within a reasonable time after any such financial institution makes a request therefor in connection with the requesting financial institution's receipt of a lawful request for such information from a federal, state, or local law enforcement or regulatory agency, or in connection with the requesting financial institution's own Bank Secrecy Act compliance program.
(iii)
(4)
(a)(1) With respect to each certificate of deposit sold or redeemed after May 31, 1978, or each deposit or share account opened with a bank after June 30, 1972, a bank shall, within 30 days from the date such a transaction occurs or an account is opened, secure and maintain a record of the taxpayer identification number of the customer involved; or where the account or certificate is in the names of two or more persons, the bank shall secure the taxpayer identification number of a person having a financial interest in the certificate or account. In the event that a
(2) The 30-day period provided for in paragraph (a)(1) of this section shall be extended where the person opening the account has applied for a taxpayer identification or social security number on Form SS-4 or SS-5, until such time as the person maintaining the account has had a reasonable opportunity to secure such number and furnish it to the bank.
(3) A taxpayer identification number required under paragraph (a)(1) of this section need not be secured for accounts or transactions with the following: (i) Agencies and instrumentalities of Federal, state, local or foreign governments; (ii) judges, public officials, or clerks of courts of record as custodians of funds in controversy or under the control of the court; (iii) aliens who are (A) ambassadors, ministers, career diplomatic or consular officers, or (B) naval, military or other attaches of foreign embassies and legations, and for the members of their immediate families; (iv) aliens who are accredited representatives of international organizations which are entitled to enjoy privileges, exemptions and immunities as an international organization under the International Organization Immunities Act of December 29, 1945 (22 U.S.C. 288), and the members of their immediate families; (v) aliens temporarily residing in the United States for a period not to exceed 180 days; (vi) aliens not engaged in a trade or business in the United States who are attending a recognized college or university or any training program, supervised or conducted by any agency of the Federal Government; (vii) unincorporated subordinate units of a tax exempt central organization which are covered by a group exemption letter, (viii) a person under 18 years of age with respect to an account opened as a part of a school thrift savings program, provided the annual interest is less than $10; (ix) a person opening a Christmas club, vacation club and similar installment savings programs provided the annual interest is less than $10; and (x) non-resident aliens who are not engaged in a trade or business in the United States. In instances described in paragraphs (a)(3), (viii) and (ix) of this section, the bank shall, within 15 days following the end of any calendar year in which the interest accrued in that year is $10 or more use its best effort to secure and maintain the appropriate taxpayer identification number or application form therefor.
(4) The rules and regulations issued by the Internal Revenue Service under section 6109 of the Internal Revenue Code of 1954 shall determine what constitutes a taxpayer identification number and whose number shall be obtained in the case of an account maintained by one or more persons.
(b) Each bank shall, in addition, retain either the original or a microfilm or other copy or reproduction of each of the following:
(1) Each document granting signature authority over each deposit or share account, including any notations, if such are normally made, of specific identifying information verifying the identity of the signer (such as a driver's license number or credit card number);
(2) Each statement, ledger card or other record on each deposit or share account, showing each transaction in, or with respect to, that account;
(3) Each check, clean draft, or money order drawn on the bank or issued and payable by it, except those drawn for $100 or less or those drawn on accounts which can be expected to have drawn on them an average of at least 100 checks per month over the calendar year or on each occasion on which such checks are issued, and which are (i) dividend checks, (ii) payroll checks, (iii) employee benefit checks, (iv) insurance claim checks, (v) medical benefit checks, (vi) checks drawn on government agency accounts, (vii) checks drawn by brokers or dealers in securities, (viii) checks drawn on fiduciary accounts, (ix) checks drawn on other financial institutions, or (x) pension or annuity checks;
(4) Each item in excess of $100 (other than bank charges or periodic charges made pursuant to agreement with the customer), comprising a debit to a customer's deposit or share account, not required to be kept, and not specifically exempted, under paragraph (b)(3) of this section;
(5) Each item, including checks, drafts, or transfers of credit, of more than $10,000 remitted or transferred to a person, account or place outside the United States;
(6) A record of each remittance or transfer of funds, or of currency, other monetary instruments, checks, investment securities, or credit, of more than $10,000 to a person, account or place outside the United States;
(7) Each check or draft in an amount in excess of $10,000 drawn on or issued by a foreign bank which the domestic bank has paid or presented to a nonbank drawee for payment;
(8) Each item, including checks, drafts or transfers of credit, of more than $10,000 received directly and not through a domestic financial institution, by letter, cable or any other means, from a bank, broker or dealer in foreign exchange outside the United States;
(9) A record of each receipt of currency, other monetary instruments, investment securities or checks, and of each transfer of funds or credit, of more than $10,000 received on any one occasion directly and not through a domestic financial institution, from a bank, broker or dealer in foreign exchange outside the United States; and
(10) Records prepared or received by a bank in the ordinary course of business, which would be needed to reconstruct a transaction account and to trace a check in excess of $100 deposited in such account through its domestic processing system or to supply a description of a deposited check in excess of $100. This subparagraph shall be applicable only with respect to demand deposits.
(11) A record containing the name, address, and taxpayer identification number, if available, of the purchaser of each certificate of deposit, as well as a description of the instrument, a notation of the method of payment, and the date of the transaction.
(12) A record containing the name, address and taxpayer identification number, if available, of any person presenting a certificate of deposit for payment, as well as a description of the instrument and the date of the transaction.
(13) Each deposit slip or credit ticket reflecting a transaction in excess of $100 or the equivalent record for direct deposit or other wire transfer deposit transactions. The slip or ticket shall record the amount of any currency involved.
(a)(1) With respect to each brokerage account opened with a broker or dealer in securities after June 30, 1972, by a person residing or doing business in the United States or a citizen of the United States, such broker or dealer shall within 30 days from the date such account is opened, secure and maintain a record of the taxpayer identification number of the person maintaining the account; or in the case of an account of one or more individuals, such broker or
(2) The 30-day period provided for in paragraph (a)(1) of this section shall be extended where the person opening the account has applied for a taxpayer identification or social security number on Form SS-4 or SS-5, until such time as the person maintaining the account has had a reasonable opportunity to secure such number and furnish it to the broker or dealer.
(3) A taxpayer identification number for a deposit or share account required under paragraph (a)(1) of this section need not be secured in the following instances: (i) Accounts for public funds opened by agencies and instrumentalities of Federal, state, local, or foreign governments, (ii) accounts for aliens who are
(b) Every broker or dealer in securities shall, in addition, retain either the original or a microfilm or other copy or reproduction of each of the following:
(1) Each document granting signature or trading authority over each customer's account;
(2) Each record described in § 240.17a-3(a) (1), (2), (3), (5), (6), (7), (8), and (9) of Title 17,
(3) A record of each remittance or transfer of funds, or of currency, checks, other monetary instruments, investment securities, or credit, of more than $10,000 to a person, account, or place, outside the United States;
(4) A record of each receipt of currency, other monetary instruments, checks, or investment securities and of each transfer of funds or credit, of more than $10,000 received on any one occasion directly and not through a domestic financial institution, from any person, account or place outside the United States.
(a) With respect to each deposit of funds, account opened or line of credit extended after the effective date of these regulations, a casino shall, at the time the funds are deposited, the account is opened or credit is extended, secure and maintain a record of the name, permanent address, and social security number of the person involved. Where the deposit, account or credit is in the names of two or more persons, the casino shall secure the name, permanent address, and social security number of each person having a financial interest in the deposit, account or line of credit. The name and
(b) In addition, each casino shall retain either the original or a microfilm or other copy or reproduction of each of the following:
(1) A record of each receipt (including but not limited to funds for safekeeping or front money) of funds by the casino for the account (credit or deposit) of any person. The record shall include the name, permanent address and social security number of the person from whom the funds were received, as well as the date and amount of the funds received. If the person from whom the funds were received is a non-resident alien, the person's passport number or a description of some other government document used to verify the person's identity shall be obtained and recorded;
(2) A record of each bookkeeping entry comprising a debit or credit to a customer's deposit account or credit account with the casino;
(3) Each statement, ledger card or other record of each deposit account or credit account with the casino, showing each transaction (including deposits, receipts, withdrawals, disbursements or transfers) in or with respect to, a customer's deposit account or credit account with the casino;
(4) A record of each extension of credit in excess of $2,500, the terms and conditions of such extension of credit, and repayments. The record shall include the customer's name, permanent address, social security number, and the date and amount of the transaction (including repayments). If the customer or person for whom the credit extended is a non-resident alien, his passport number or description of some other government document used to verify his identity shall be obtained and recorded;
(5) A record of each advice, request or instruction received or given by the casino for itself or another person with respect to a transaction involving a person, account or place outside the United States (including but not limited to communications by wire, letter, or telephone). If the transfer outside the United States is on behalf of a third party, the record shall include the third party's name, permanent address, social security number, signature, and the date and amount of the transaction. If the transfer is received from outside the United States on behalf of a third party, the record shall include the third party's name, permanent address, social security number, signature, and the date and amount of the transaction. If the person for whom the transaction is being made is a non-resident alien the record shall also include the person's name, his passport number or a description of some other government document used to verify his identity;
(6) Records prepared or received by the casino in the ordinary course of business which would be needed to reconstruct a person's deposit account or credit account with the casino or to trace a check deposited with the casino through the casino's records to the bank of deposit;
(7) All records, documents or manuals required to be maintained by a casino under state and local laws or regulations, regulations of any governing Indian tribe or tribal government, or terms of (or any regulations issued under) any Tribal-State compacts entered into pursuant to the Indian Gaming Regulatory Act, with respect to the casino in question.
(8) All records which are prepared or used by a casino to monitor a customer's gaming activity.
(9)(i) A separate record containing a list of each transaction between the casino and its customers involving the following types of instruments having a face value of $3,000 or more:
(A) Personal checks (excluding instruments which evidence credit granted by a casino strictly for gaming, such as markers);
(B) Business checks (including casino checks);
(C) Official bank checks;
(D) Cashier's checks;
(E) Third-party checks;
(F) Promissory notes;
(G) Traveler's checks; and
(H) Money orders.
(ii) The list will contain the time, date, and amount of the transaction; the name and permanent address of the customer; the type of instrument; the name of the drawee or issuer of the instrument; all reference numbers (
(10) A copy of the compliance program described in § 103.54(a).
(11) In the case of card clubs only, records of all currency transactions by customers, including without limitation, records in the form of currency transaction logs and multiple currency transaction logs, and records of all activity at cages or similar facilities, including, without limitation, cage control logs.
(c)(1) Casinos which input, store, or retain, in whole or in part, for any period of time, any record required to be maintained by § 103.33 or this section on computer disk, tape, or other machine-readable media shall retain the same on computer disk, tape, or machine-readable media.
(2) All indexes, books, programs, record layouts, manuals, formats, instructions, file descriptions, and similar materials which would enable a person readily to access and review the records that are described in § 103.33 and this section and that are input, stored, or retained on computer disk, tape, or other machine-readable media shall be retained for the period of time such records are required to be retained.
At 63 FR 1924, § 103.36 was amended by adding paragraph (b)(11), effective Aug. 1, 1998.
(a)(1) After July 7, 1987, each currency dealer or exchanger shall secure and maintain a record of the taxpayer identification number of each person for whom a transaction account is opened or a line of credit is extended within 30 days after such account is opened or credit line extended. Where a person is a non-resident alien, the currency dealer or exchanger shall also record the person's passport number or a description of some other government document used to verify his identity. Where the account or credit line is in the names of two or more persons, the currency dealer or exchanger shall secure the taxpayer identification number of a person having a financial interest in the account or credit line. In the event that a currency dealer or exchanger has been unable to secure the identification required within the 30-day period specified, it shall nevertheless not be deemed to be in violation of this section if:
(i) It has made a reasonable effort to secure such identification, and
(ii) It maintains a list containing the names, addresses, and account or credit line numbers of those persons from whom it has been unable to secure such identification, and makes the names, addresses, and account or credit line numbers of those persons available to the Secretary as directed by him.
(2) The 30-day period provided for in paragraph (a)(1) of this section shall be extended where the person opening the account or credit line has applied for a
(3) A taxpayer identification number for an account or credit line required under paragraph (a)(1) of this section need not be secured in the following instances:
(i) Accounts for public funds opened by agencies and instrumentalities of Federal, state, local or foreign governments,
(ii) Accounts for aliens who are—
(A) Ambassadors, ministers, career diplomatic or consular officers, or
(B) Naval, military or other attaches of foreign embassies, and legations, and for members of their immediate families,
(iii) Accounts for aliens who are accredited representatives to international organizations which are entitled to enjoy privileges, exemptions, and immunities as an international organization under the International Organizations Immunities Act of December 29, 1945 (22 U.S.C. 288), and for the members of their immediate families,
(iv) Aliens temporarily residing in the United States for a period not to exceed 180 days,
(v) Aliens not engaged in a trade or business in the United States who are attending a recognized college or any training program, supervised or conducted by any agency of the Federal Government, and
(vi) Unincorporated subordinate units of a tax exempt central organization which are covered by a group exemption letter.
(b) Each currency dealer or exchanger shall retain either the original or a microfilm or other copy or reproduction of each of the following:
(1) Statements of accounts from banks, including paid checks, charges or other debit entry memoranda, deposit slips and other credit memoranda representing the entries reflected on such statements;
(2) Daily work records, including purchase and sales slips or other memoranda needed to identify and reconstruct currency transactions with customers and foreign banks;
(3) A record of each exchange of currency involving transactions in excess of $1000, including the name and address of the customer (and passport number or taxpayer identification number unless received by mail or common carrier) date and amount of the transaction and currency name, country, and total amount of each foreign currency;
(4) Signature cards or other documents evidencing signature authority over each deposit or security account, containing the name of the depositor, street address, taxpayer identification number (TIN) or employer identification number (EIN) and the signature of the depositor or of a person authorized to sign on the account (if customer accounts are maintained in a code name, a record of the actual owner of the account);
(5) Each item, including checks, drafts, or transfers of credit, of more than $10,000 remitted or transferred to a person, account or place outside the United States;
(6) A record of each receipt of currency, other monetary instruments, investment securities and checks, and of each transfer of funds or credit, or more than $10,000 received on any one occasion directly and not through a domestic financial institution, from any person, account or place outside the United States;
(7) Records prepared or received by a dealer in the ordinary course of business, that would be needed to reconstruct an account and trace a check in excess of $100 deposited in such account through its internal recordkeeping system to its depository institution, or to supply a description of a deposited check in excess of $100;
(8) A record maintaining the name, address and taxpayer identification number, if available, of any person presenting a certificate of deposit for payment, as well as a description of the instrument and date of transaction;
(9) A system of books and records that will enable the currency dealer or
(a) Wherever it is required that there be retained either the original or a microfilm or other copy or reproduction of a check, draft, monetary instrument, investment security, or other similar instrument, there shall be retained a copy of both front and back of each such instrument or document, except that no copy need be retained of the back of any instrument or document which is entirely blank or which contains only standardized printed information, a copy of which is on file.
(b) Records required by this subpart to be retained by financial institutions may be those made in the ordinary course of business by a financial institution. If no record is made in the ordinary course of business of any transaction with respect to which records are required to be retained by this subpart, then such a record shall be prepared in writing by the financial institution.
(c) The rules and regulations issued by the Internal Revenue Service under 26 U.S.C. 6109 determine what constitutes a taxpayer identification number and whose number shall be obtained in the case of an account maintained by one or more persons.
(d) All records that are required to be retained by this part shall be retained for a period of five years. Records or reports required to be kept pursuant to an order issued under § 103.26 of this part shall be retained for the period of time specified in such order, not to exceed five years. All such records shall be filed or stored in such a way as to be accessible within a reasonable period of time, taking into consideration the nature of the record, and the amount of time expired since the record was made.
For the purposes of this subpart, a remittance or transfer of funds, or of currency, other monetary instruments, checks, investment securities, or credit to the domestic account of a person whose address is known by the person making the remittance or transfer, to be outside the United States, shall be deemed to be a remittance or transfer to a person outside the United States, except that, unless otherwise directed by the Secretary, this section shall not apply to a transaction on the books of a domestic financial institution involving the account of a customer of such institution whose address is within approximately 50 miles of the location of the institution, or who is known to be temporarily outside the United States.
Wherever in this part an amount is stated in dollars, it shall be deemed to mean also the equivalent amount in any foreign currency.
Nothing herein contained shall require or authorize the microfilming or other reproduction of
(a) Currency or other obligation or security of the United States as defined in 18 U.S.C. 8, or
(b) Any obligation or other security of any foreign government, the reproduction of which is prohibited by law.
(a) The Secretary may within his discretion disclose information reported under this part for any reason consistent with the purposes of the Bank Secrecy Act, including those set forth in paragraphs (b) through (d) of this section.
(b) The Secretary may make any information set forth in any report received pursuant to this part available to another agency of the United States, to an agency of a state or local government or to an agency of a foreign government, upon the request of the head of such department or agency made in writing and stating the particular information desired, the criminal, tax or regulatory purpose for which the information is sought, and the official need for the information.
(c) The Secretary may make any information set forth in any report received pursuant to this part available to the Congress, or any committee or subcommittee thereof, upon a written request stating the particular information desired, the criminal, tax or regulatory purpose for which the information is sought, and the official need for the information.
(d) The Secretary may make any information set forth in any report received pursuant to this part available to any other department or agency of the United States that is a member of the Intelligence Community, as defined by Executive Order 12333 or any succeeding executive order, upon the request of the head of such department or agency made in writing and stating the particular information desired, the national security matter with which the information is sought and the official need therefor.
(e) Any information made available under this section to other department or agencies of the United States, any state or local government, or any foreign government shall be received by them in confidence, and shall not be disclosed to any person except for official purposes relating to the investigation, proceeding or matter in connection with which the information is sought.
(f) The Secretary may require that a state or local government department or agency requesting information under paragraph (b) of this section pay fees to reimburse the Department of the Treasury for costs incidental to such disclosure. The amount of such fees will be set in accordance with the statute on fees for government services, 31 U.S.C. 9701.
All reports required under this part and all records of such reports are specifically exempted from disclosure under section 552 of Title 5, United States Code.
(a) The Secretary, in his sole discretion, may by written order or authorization make exceptions to or grant exemptions from the requirements of this part. Such exceptions or exemptions may be conditional or unconditional, may apply to particular persons or to classes of persons, and may apply to particular transactions or classes of transactions. They shall, however, be applicable only as expressly stated in the order of authorization, and they shall be revocable in the sole discretion of the Secretary.
(b) The Secretary shall have authority to further define all terms used herein.
(c)(1) The Secretary may, as an alternative to the reporting and recordkeeping requirements for casinos in §§ 103.22(a)(2) and 103.25(a)(2), and 103.36, grant exemptions to the casinos in any state whose regulatory system substantially meets the reporting and recordkeeping requirements of this part.
(2) In order for a state regulatory system to qualify for an exemption on behalf of its casinos, the state must provide:
(i) That the Treasury Department be allowed to evaluate the effectiveness of
(ii) That the reports required under the state's regulatory system be submitted to the Treasury Department within 15 days of receipt by the state;
(iii) That any records required to be maintained by the casinos relevant to any matter under this part and to which the state has access or maintains under its regulatory system be made available to the Treasury Department within 30 days of request;
(iv) That the Treasury Department be provided with periodic status reports on the state's compliance efforts and findings;
(v) That all but minor violations of the state requirements be reported to Treasury within 15 days of discovery; and
(vi) That the state will initiate compliance examinations of specific institutions at the request of Treasury within a reasonable time, not to exceed 90 days where appropriate, and will provide reports of these examinations to Treasury within 15 days of completion or periodically during the course of the examination upon the request of the Secretary. If for any reason the state were not able to conduct an investigation within a reasonable time, the state will permit Treasury to conduct the investigation.
(3) Revocation of any exemption under this subsection shall be in the sole discretion of the Secretary.
(a) Overall authority for enforcement and compliance, including coordination and direction of procedures and activities of all other agencies exercising delegated authority under this part, is delegated to the Assistant Secretary (Enforcement).
(b) Authority to examine institutions to determine compliance with the requirements of this part is delegated as follows:
(1) To the Comptroller of the Currency with respect to those financial institutions regularly examined for safety and soundness by national bank examiners;
(2) To the Board of Governors of the Federal Reserve System with respect to those financial institutions regularly examined for safety and soundness by Federal Reserve bank examiners;
(3) To the Federal Deposit Insurance Corporation with respect to those financial institutions regularly examined for safety and soundness by FDIC bank examiners;
(4) To the Federal Home Loan Bank Board with respect to those financial institutions regularly examined for safety and soundness by FHLBB bank examiners;
(5) To the Chairman of the Board of the National Credit Union Administration with respect to those financial institutions regularly examined for safety and soundness by NCUA examiners.
(6) To the Securities and Exchange Commission with respect to brokers or dealers in securities;
(7) To the Commissioner of Customs with respect to §§ 103.23 and 103.48;
(8) To the Commissioner of Internal Revenue with respect to all financial institutions, except brokers or dealers in securities, not currently examined by Federal bank supervisory agencies for soundness and safety.
(c) Authority for investigating criminal violations of this part is delegated as follows:
(1) To the Commissioner of Customs with respect to § 103.23;
(2) To the Commissioner of Internal Revenue except with respect to § 103.23.
(d) Authority for the imposition of civil penalties for violations of this part lies with the Assistant Secretary, and in the Assistant Secretary's absence, the Deputy Assistant Secretary (Law Enforcement).
(e) Periodic reports shall be made to the Assistant Secretary by each agency to which compliance authority has been delegated under paragraph (b) of this section. These reports shall be in such a form and submitted at such intervals as the Assistant Secretary may direct. Evidence of specific violations of any of the requirements of this part may be submitted to the Assistant Secretary at any time.
(f) The Assistant Secretary or his delegate, and any agency to which compliance has been delegated under
(a) For any willful violation, committed on or before October 12, 1984, of any reporting requirement for financial institutions under this part or of any recordkeeping requirements of § 103.22, the Secretary may assess upon any domestic financial institution, and upon any partner, director, officer, or employee thereof who willfully participates in the violation, a civil penalty not to exceed $1,000.
(b) For any willful violation committed after October 12, 1984 and before October 28, 1986, of any reporting requirement for financial institutions under this part or of the recordkeeping requirements of § 103.32, the Secretary may assess upon any domestic financial institution, and upon any partner, director, officer, or employee thereof who willfully participates in the violation, a civil penalty not to exceed $10,000.
(c) For any willful violation of any recordkeeping requirement for financial institutions, except violations of § 103.32, under this part, the Secretary may assess upon any domestic financial institution, and upon any partner, director, officer, or employee thereof who willfully participates in the violation, a civil penalty not to exceed $1,000.
(d) For any failure to file a report required under § 103.23 or for filing such a report containing any material omission or misstatement, the Secretary may assess a civil penalty up to the amount of the currency or monetary instruments transported, mailed or shipped, less any amount forfeited under § 103.48.
(e) For any willful violation of § 103.53 committed after January 26, 1987, the Secretary may assess upon any person a civil penalty not to exceed the amount of coins and currency involved in the transaction with respect to which such penalty is imposed. The amount of any civil penalty assessed under this paragraph shall be reduced by the amount of any forfeiture to the United States in connection with the transaction for which the penalty was imposed.
(f) For any willful violation committed after October 27, 1986, of any reporting requirement for financial institutions under this part (except § 103.24, § 103.25 or § 103.32), the Secretary may assess upon any domestic financial institution, and upon any partner, director, officer, or employee thereof who willfully participates in the violation, a civil penalty not to exceed the greater of the amount (not to exceed $100,000) involved in the transaction or $25,000.
(g) For any willful violation committed after October 27, 1986, of any requirement of § 103.24, § 103.25, or § 103.32, the Secretary may assess upon any person, a civil penalty:
(1) In the case of a violation of § 103.25 involving a transaction, a civil penalty not to exceed the greater of the amount (not to exceed $100,000) of the transaction, or $25,000; and
(2) In the case of a violation of § 103.24 or § 103.32 involving a failure to report the existence of an account or any identifying information required to be provided with respect to such account, a civil penalty not to exceed the greater of the amount (not to exceed $100,000) equal to the balance in the account at the time of the violation, or $25,000.
(h) For each negligent violation of any requirement of this part, committed after October 27, 1986, the Secretary may assess upon any financial institution a civil penalty not to exceed $500.
Any currency or other monetary instruments which are in the process of any transportation with respect to which a report is required under § 103.23 are subject to seizure and forfeiture to
(a) Any person who willfully violates any provision of Title I of Pub. L. 91-508, or of this part authorized thereby may, upon conviction thereof, be fined not more than $1,000 or be imprisoned not more than 1 year, or both. Such person may in addition, if the violation is of any provision authorized by Title I of Pub. L. 91-508 and if the violation is committed in furtherance of the commission of any violation of Federal law punishable by imprisonment for more than 1 year, be fined not more than $10,000 or be imprisoned not more than 5 years, or both.
(b) Any person who willfully violates any provision of Title II of Pub. L. 91-508, or of this part authorized thereby, may, upon conviction thereof, be fined not more than $250,000 or be imprisoned not more than 5 years, or both.
(c) Any person who willfully violates any provision of Title II of Pub. L. 91-508, or of this part authorized thereby, where the violation is either
(1) Committed while violating another law of the United States, or
(2) Committed as part of a pattern of any illegal activity involving more than $100,000 in any 12-month period, may, upon conviction thereof, be fined not more than $500,000 or be imprisoned not more than 10 years, or both.
(d) Any person who knowingly makes any false, fictitious or fraudulent statement or representation in any report required by this part may, upon conviction thereof, be fined not more than $10,000 or be imprisoned not more than 5 years, or both.
(a) If a customs officer has reasonable cause to believe that there is a monetary instrument being transported without the filing of the report required by §§ 103.23 and 103.25 of this chapter, he may stop and search, without a search warrant, a vehicle, vessel, aircraft, or other conveyance, envelope or other container, or person entering or departing from the United States with respect to which or whom the officer reasonably believes is transporting such instrument.
(b) If the Secretary has reason to believe that currency or monetary instruments are in the process of transportation and with respect to which a report required under § 103.23 has not been filed or contains material omissions or misstatements, he may apply to any court of competent jurisdiction for a search warrant. Upon a showing of probable cause, the court may issue a warrant authorizing the search of any or all of the following:
(1) One or more designated persons.
(2) One or more designated or described places or premises.
(3) One or more designated or described letters, parcels, packages, or other physical objects.
(4) One or more designated or described vehicles. Any application for a search warrant pursuant to this section shall be accompanied by allegations of fact supporting the application.
(c) This section is not in derogation of the authority of the Secretary under any other law or regulation.
Except as provided in §§ 103.34(a)(1), 103.35(a)(1), and 103.36(a) and except for the purpose of assuring compliance with the recordkeeping and reporting requirements of this part, this part does not authorize the Secretary or any other person to inspect or review the records required to be maintained by subpart C of this part. Other inspection, review or access to such records is governed by other applicable law.
(a) If an individual provides original information which leads to a recovery
(b) The Secretary shall determine the amount of the reward to be paid under this section; however, any reward paid may not be more than 25 percent of the net amount of the fine, penalty or forfeiture collected, or $150,000, whichever is less.
(c) An officer or employee of the United States, a State, or a local government who provides original information described in paragraph (a) in the performance of official duties is not eligible for a reward under this section.
No person shall for the purpose of evading the reporting requirements of § 103.22 with respect to such transaction:
(a) Cause or attempt to cause a domestic financial institution to fail to file a report required under § 103.22;
(b) Cause or attempt to cause a domestic financial institution to file a report required under § 103.22 that contains a material omission or misstatement of fact; or
(c) Structure (as that term is defined in § 103.11(n) of this part) or assist in structuring, or attempt to structure or assist in structuring, any transaction with one or more domestic financial institutions.
(a)
(2) At a minimum, each compliance program shall provide for:
(i) A system of internal controls to assure ongoing compliance;
(ii) Internal and/or external independent testing for compliance;
(iii) Training of casino personnel, including training in the identification of unusual or suspicious transactions, to the extent that the reporting of such transactions is hereafter required by this part, by other applicable law or regulation, or by the casino's own administrative and compliance policies;
(iv) An individual or individuals to assure day-to-day compliance;
(v) Procedures for using all available information to determine:
(A) When required by this part, the name, address, social security number, and other information, and verification of the same, of a person;
(B) When required by this part, the occurrence of unusual or suspicious transactions; and
(C) Whether any record as described in subpart C of this part must be made and retained; and
(vi) For casinos that have automated data processing systems, the use of automated programs to aid in assuring compliance.
(b)
(1)
(2)
(3)
(4)
(5)
For any investigation for the purpose of civil enforcement of violations of the Currency and Foreign Transactions Reporting Act, as amended (31 U.S.C. 5311 through 5324), section 21 of the Federal Deposit Insurance Act (12 U.S.C. 1829b), section 411 of the National Housing Act (12 U.S.C. 1730d), or Chapter 2 of Pub. L. 91-508 (12 U.S.C. 1951
For purposes of this part, the following officials are hereby designated as delegates of the Secretary who are authorized to issue a summons under § 103.61, solely for the purposes of civil enforcement of this part:
(a)
(b)
(c)
(a)
(1) The name, title, address, and telephone number of the person before whom the appearance shall take place (who may be a person other than the persons who are authorized to issue such a summons under § 103.62 of this part);
(2) The address to which the person summoned shall report for the appearance;
(3) The date and time of the appearance; and
(4) The name, title, address, and telephone number of the person who has issued the summons.
(b)
(1) The name, title, address, and telephone number of the person to whom the materials shall be produced (who may be a person other than the persons who are authorized to issue such a summons under § 103.62 of this part);
(2) The address at which the person summoned shall produce the materials, not to exceed 500 miles from any place where the financial institution operates or conducts business in the United States;
(3) The specific manner of production, whether by personal delivery, by mail, or by messenger service;
(4) The date and time for production; and
(5) The name, title, address, and telephone number of the person who has issued the summons.
(a)
(b)
(1) Upon any person, by registered mail, return receipt requested, directed to the person summoned;
(2) Upon a natural person by personal delivery; or
(3) Upon any other person by delivery to an officer, managing or general agent, or any other agent authorized to receive service of process.
(c)
(a)
(b)
(c)
(1) Make public the name of any person to whom a summons has been issued under this part, or release any information to the public concerning that person or the issuance of a summons to that person prior to the time and date set for that person's appearance or production of records; or
(2) Disclose any testimony taken (including the name of the witness) or material presented pursuant to the summons, to any person other than an officer or employee of the Treasury Department or of any component thereof.
In the case of contumacy by, or refusal to obey a summons issued to, any person under this part, the Secretary or any delegate of the Secretary listed under § 103.62 of this part shall refer the matter to the Attorney General or delegate of the Attorney General (including any United States Attorney or Assistant United States Attorney, as appropriate), who may bring an action to
Persons summoned under this part shall be paid the same fees and mileage for travel in the United States that are paid witnesses in the courts of the United States. The United States shall not be liable for any other expense incurred in connection with the production of books, papers, records, or other data under this part.
This subpart provides that the Assistant Secretary (Enforcement), or his designee, either unilaterally or upon request, may issue administrative rulings interpreting the application of part 103.
(a) Each request for an administrative ruling must be in writing and contain the following information:
(1) A complete description of the situation for which the ruling is requested,
(2) A complete statement of all material facts related to the subject transaction,
(3) A concise and unambiguous question to be answered,
(4) A statement certifying, to the best of the requestor's knowledge and belief, that the question to be answered is not applicable to any ongoing state or federal investigation, litigation, grand jury proceeding, or proceeding before any other governmental body involving either the requestor, any other party to the subject transaction, or any other party with whom the requestor has an agency relationship,
(5) A statement identifying any information in the request that the requestor considers to be exempt from disclosure under the Freedom of Information Act, 5 U.S.C. 552, and the reason therefor,
(6) If the subject situation is hypothetical, a statement justifying why the particular situation described warrants the issuance of a ruling,
(7) The signature of the person making the request, or
(8) If an agent makes the request, the signature of the agent and a statement certifying the authority under which the request is made.
(b) A request filed by a corporation shall be signed by a corporate officer and a request filed by a partnership shall be signed by a partner.
(c) A request may advocate a particular proposed interpretation and may set forth the legal and factual basis for that interpretation.
(d) Requests shall be addressed to: Director, Office of Financial Enforcement, Office of the Assistant Secretary (Enforcement), U.S. Department of the Treasury, 1500 Pennsylvania Avenue NW., Room 4320, Washington, DC 20220.
(e) The requester shall advise the Director, Office of Financial Enforcement, immediately in writing of any subsequent change in any material fact or statement submitted with a ruling request in conformity with paragraph (a) of this section.
The Director, Office of Financial Enforcement, shall notify the requester if the ruling request does not conform with the requirements of § 103.71. The notice shall be in writing and shall describe the requirements that have not been met. A request that is not brought into conformity with such requirements within 30 days from the date of such notice, unless extended for good cause by the Office of Financial Enforcement, shall be treated as though it were withdrawn.
(a) The Office of the Assistant Secretary (Enforcement) will not issue administrative rulings in response to oral requests. Oral opinions or advice by Treasury, the Customs Service, the Internal Revenue Service, the Office of the Comptroller of the Currency, or any other bank supervisory agency personnel, regarding the interpretation and application of this part, do not bind the Treasury Department and carry no precedential value.
(b) A person who has made a ruling request in conformity with § 103.71 may request an opportunity for oral discussion of the issues presented in the request. The request should be made to the Director, Office of Financial Enforcement, and any decision to grant such a conference is wholly within the discretion of the Director. Personal conferences or telephone conferences may be scheduled only for the purpose of affording the requester an opportunity to discuss freely and openly the matters set forth in the administrative ruling request. Accordingly, the conferees will not be bound by any argument or position advocated or agreed to, expressly or impliedly, during the conference. Any new arguments or facts put forth by the requester at the meeting must be reduced to writing by the requester and submitted in conformity with § 103.71 before they may be considered in connection with the request.
A person may withdraw a request for an administrative ruling at any time before the ruling has been issued.
The Assistant Secretary (Enforcement), or his designee may issue a written ruling interpreting the relationship between part 103 and each situation for which such a ruling has been requested in conformity with § 103.71. A ruling issued under this section shall bind the Treasury Department only in the event that the request describes a specifically identified actual situation. A ruling issued under this section shall have precedential value, and hence may be relied upon by others similarly situated, only if it is published or will be published by the Office of Financial Enforcement in the
(a) The Assistant Secretary (Enforcement), or his designee may modify or rescind any ruling made pursuant to § 103.75:
(1) When, in light of changes in the statute or regulations, the ruling no longer sets forth the interpretation of the Assistant Secretary (Enforcement) with respect to the described situation,
(2) When any fact or statement submitted in the original ruling request is found to be materially inaccurate or incomplete, or
(3) For other good cause.
(b) Any person may submit to the Assistant Secretary (Enforcement) a written request that an administrative ruling be modified or rescinded. The request should conform to the requirements of § 103.71, explain why rescission or modification is warranted, and refer
(c) Treasury shall modify an existing administrative ruling by issuing a new ruling that rescinds the relevant prior ruling. Once rescinded, an administrative ruling shall no longer have any precedential value.
(d) An administrative ruling may be modified or rescinded retroactively with respect to one or more parties to the original ruling request if the Assistant Secretary determines that:
(1) A fact or statement in the original ruling request was materially inaccurate or incomplete,
(2) The requestor failed to notify in writing the Office of Enforcement of a material change to any fact or statement in the original request, or
(3) A party to the original request acted in bad faith when relying upon the ruling.
(a) Any part of any administrative ruling, including names, addresses, or information related to the business transactions of private parties, may be disclosed pursuant to a request under the Freedom of Information Act, 5 U.S.C. 552. If the request for an administrative ruling contains information which the requestor wishes to be considered for exemption from disclosure under the Freedom of Information Act, the requestor should clearly identify such portions of the request and the reasons why such information should be exempt from disclosure.
(b) A requestor claiming an exemption from disclosure will be notified, at least 10 days before the administrative ruling is issued, of a decision not to exempt any of such information from disclosure so that the underlying request for an administrative ruling can be withdrawn if the requestor so chooses.
What action should a financial institution take when it believes that it is being misused by persons who are intentionally structuring transactions to evade the reporting requirement or engaging in transactions that may involve illegal activity such as drug trafficking, tax evasion or money laundering?
A teller at X State Bank notices that the same person comes into the bank each day and purchases, with cash, between $9,000 and $9,900 in cashier's checks. Even when aggregated, these purchases never exceed $10,000 during any one business day. The teller also notices that this person tries to go to different tellers for each transaction and is very reluctant to provide information about his frequent transactions or other information such as name, address, etc. Likewise, the payees on these cashier's checks all have common names such as “John Smith” or “Mary Jones.” The teller informs the bank's compliance officer that she believes that this person is structuring his transactions in order to evade the reporting requirements under the Bank Secrecy Act. X State Bank wants to know what actions it should take in this situation or in any other situation where a transaction or a person conducting a transaction appears suspicious.
As it appears that the person may be intentionally structuring the transactions to evade the Bank Secrecy Act reporting requirements, X State Bank should immediately telephone the local office of the Internal Revenue Service (“IRS”) and speak to a Special Agent in the IRS Criminal Investigation Division, or should call 1-800-BSA-CTRS, where his call will be referred to a Special Agent.
Any information provided to the IRS should be given within the confines of § 1103(c) of the Right to Financial Privacy Act. 12 U.S.C. 3401-3422. Section 1103(c) of that Act permits a financial instituiton to notify a government authority of information relevant to a possible violation of any statute or regulation. Such information may consist of the names of any individuals or corporate entities involved in the suspicious transactions; account numbers; home and business addresses; social security numbers; type of account; interest paid on account; location of the branch or office where the suspicious transaction occurred; a specification of the offense that the financial institution
Additionally, the bank may be required, by the Federal regulatory agency which supervises it, to submit a criminal referral form. Thus, the bank should check with its regulatory agency to determine whether a referral form should be submitted.
Lastly, under the facts as described above, X State Bank is not required to file a Currency Transaction Report (“CTR”) because the currency transaction (i.e. purchase of cashier's checks) did not exceed $10,000 during one business day. If the bank had found that on a particular day the person had in fact used a total of more than $10,000 in currency to purchase cashier's checks, but had each individual cashier's check made out in amounts of less than $10,000, the bank is obligated to file a CTR, and should follow the other steps described above.
If X State Bank notices that a person may be misusing it by intentionally structuring transactions to evade the BSA reporting requirements or engaging in transactions that may involve other illegal activity, the bank should telephone the local office of the Internal Revenue Service, Criminal Investigation Division, and report that information to a Special Agent, or should call 1-800-BSA-CTRS. In addition, the Federal regulatory agency which supervises X State Bank may require the bank to submit a criminal referral form. All disclosures to the Government should be made in accordance with the provisions of the Right to Financial Privacy Act.
When, if ever, should a bank file a CMIR on behalf of its customer, when the customer is importing or exporting more than $10,000 in currency or monetary instruments?
A customer walks into B National Bank (“B”) with $15,000 in cash for deposit into her account. As is required, the bank teller begins to fill out a Currency Transaction Report (“CTR”, IRS Form 4789) in order to report a transaction in currency of more than $10,000. While the teller is filling out the CTR, the customer mentions to the teller that she has just received the money in a letter from a relative in France. Should the teller also file a CMIR, either on the customer's behalf or on the bank's behalf?
B National Bank should not file a CMIR when a customer deposits currency in excess of $10,000 into her account, even if the bank has knowledge that the customer received the currency from a place outside the United States. 31 CFR 103.23 requires that a CMIR be filed by anyone who transports, mails, ships or receives, or attempts, causes or attempts to cause the transportation, mailing, shipping or receiving of currency or monetary instruments in excess of $10,000, from or to a place outside the United States. The term “monetary instruments” includes currency and instruments such as negotiable instruments endorsed without restriction.
The obligation to file the CMIR is solely on the person who transports, mails, ships or receives, or causes or attempts to transport, mail, ship or receive. No other person is under any obligation to file a CMIR. Thus, if a customer walks into the bank and declares that he or she has received or transported currency in an aggregate amount exceeding $10,000 from a place outside the United States and wishes to deposit the currency into his or her account, the bank is under no obligation to file a CMIR on the customer's behalf. Likewise, because the bank itself did not receive the money from a customer outside the United States, it has no obligation to file a CMIR on its own behalf. The same holds true if a customer declares his intent to transport currency or monetary instruments in excess of $10,000 to a place outside the United States.
However, the bank is strongly encouraged to inform the customer of the CMIR reporting requirement. If the bank has knowledge that the customer is aware of the CMIR reporting requirement, but is nevertheless disregarding the requirement or if information about the transaction is otherwise suspicious, the bank should contact the local office of the U.S. Customs Service or 1-800-BE ALERT. The United States Customs Service has been delegated authority by the Assistant Secretary (Enforcement) to investigate criminal violations of 31 CFR 103.23.
Any information provided to Customs should be given within the confines of section 1103(c) of the Right to Financial Privacy Act, 12 U.S.C. 3401-3422. Section 1103(c) permits a financial institution to notify a Government authority of information relevant to a possible violation of any statute or regulation. Such information may consist of the name (including those of corporate entities) of any individual involved in the suspicious transaction; account numbers; home and business addresses; social security numbers; type of account; interest paid on account; location of branch where the suspicious transaction occurred; a specification of the offense that the financial institution believes has been committed; and a description of the activities giving rise to the bank's suspicions.
A previous interpretation of § 103.23(b) by Treasury held that if a bank received currency or monetary instruments over the counter from a person who may have transported them into the United States, and knows that such items have been transported into the country, it must file a report on Form 4790 if a complete and truthful report has not been filed by the customer.
A bank should not file a CMIR when a customer deposits currency or monetary instruments in excess of $10,000 into her account even if the bank has knowledge that the currency or monetary instruments were received or transported from a place outside the United States. 31 CFR 103.23. The same is true if the bank has knowledge that the customer intends to transport the currency or monetary instruments to a place outside the United States. However, the bank is required to file a CTR if it receives in excess of $10,000 in cash from its customer, and is strongly encouraged to inform the customer of the CMIR requirements. In addition, if the bank has knowledge that the customer is aware of the CMIR reporting requirement and is nevertheless planning to disregard it or if the transaction is otherwise suspicious, the bank should notify the local office of the United States Customs Service (or 1-800-
Whether a bank may exempt “cash-back” transactions of a customer whose primary business is of a type that may be exempted either unilaterally by the bank or pursuant to additional authority granted by the IRS.
The ABC Grocery (“ABC”), a retail grocery store, has an account at the X State Bank for its daily deposits of currency. Because ABC regularly and frequently deposits amounts ranging from $20,000 to $30,000, the bank has properly granted ABC an exemption for daily deposits up to a limit of $30,000.
Recently, ABC began providing its customers with a check-cashing service as an adjunct to its primary business of selling groceries. ABC's primary business still consists of the sale of groceries. However, the unexpectedly heavy demand for ABC's check-cashing service has required ABC to maintain a substantially greater quantity of cash in the store than was necessary for the grocery business in the past. To facilitate the operations of its check-cashing service, ABC is presenting the bank with large numbers of checks in “cash-back” transactions, rather than depositing the checks into its account and withdrawing cash from that account. X State Bank has just been presented with a “cash-back” transaction wherein an employee of ABC is exchanging $15,000 worth of checks for cash. How should the bank treat this transaction?
A
Moreover, because “cash back” transactions are never exemptible, the bank may not unilaterally exempt “cash-back” transactions by ABC, or seek additional authority from the IRS to grant a special exemption for ABC's “cash-back” transactions. Instead, the bank must report ABC's “cash back” transaction on a CTR, listing it as a $15,000 “check cashed” transaction.
A bank may never grant a unilateral exemption, or obtain additional authority from the IRS to grant a special exemption to the “cash-back” transactions of a customer. A “cash back” transaction is one where one or more checks or other monetary instruments are presented in exchange for cash or a portion of the checks or monetary instruments
If a bank has exempted a single account of a customer into which multiple establishments of that customer make deposits, must the bank list all of the establishments on its exemption list or may the bank list only the § 103.22(f) information of the customer's headquarters or its principal business establishment on its exemption list?
A fast food company operates a chain of fast-food restaurants in several states. In New York, the company has established a single deposit account at Bank A, into which all of the company's establishments in that area make deposits. In Connecticut, the company has established ten bank accounts at Bank B; each of the company's ten establishments in Connecticut have been assigned a separate account into which it makes deposits. Banks A and B have properly exempted the company's accounts, but now seek guidance on the manner in which they should add these accounts to their exemption lists. All of the company's establishments use the same taxpayer identification number (“TIN”).
Under the regulations, the bank must keep “in a centralized list,” § 103.22(f) information for “each depositor that has engaged in currency transactions which have not been reported because of (an) exemption * * *” However, where all of the company's establishments deposit into one exempt account as at Bank A, above, the bank need only maintain § 103.22(f) information on its list for the customer's corporate headquarters or the principal establishment that obtained the exemption. The bank may, but is not required to, list identifying information for all of the customers’ establishments depositing into the one account. If the bank chooses to list only the information for the customer's headquarters or principal establishment, it should briefly note that on the exemption list and should ensure that the individual addresses for each establishment are readily available upon request. Where each of the company's establishments deposit into separate exempt accounts as at Bank B, the bank must maintain separate § 103.22(f) information on the exemption list for each establishment.
Under § 103.22(b)(2) (i), (ii), and (iv) and § 103.22(e) of the regulation, a bank can only grant an exemption for “an existing account (of) an established depositor who is a United States resident.” Under these provisions, therefore, the bank can only grant an exemption for an existing individual account, not for an individual customer or group of accounts. Thus, if a customer has a separate account for each of its business establishments, the bank must consider each account for a separate exemption. If the bank grants exemptions for more than one account, it should prepare a separate exemption statement and establish a separate dollar limit for each account.
Once an exemption has been granted for an account, § 103.22(f) requires the bank to maintain a centralized exemption list that includes the name, address, business, types of transactions exempted, the dollar limit of the exemption, taxpayer identification number, and account number of the customers whose accounts have been exempted.
Under 31 CFR 103.22, when a bank has exempted a single account of a customer into which more than one of the customer's establishments make deposits, the bank may include the name, address, business, type of transactions exempted, the dollar limit of the exemption, taxpayer identification number, and account number (“§ 103.22(f) information”) of either the customer's headquarters or the principal business establishment, or it may separately list § 103.22(f) information for each of the establishments using that account. If the bank chooses to list only the information for the customer's headquarters or principal establishment, it should briefly note that fact on the exemption list, and it should ensure that the individual addresses of those establishments not on the list are readily available upon request. If a bank has granted separate exemptions to several accounts, each of which is used by a single establishment of the same customer, the bank must include on its exemption list § 103.22(f) information for each of those establishments. Previous Treasury correspondence or interpretations contrary to this policy are hereby rescinded.
Does a financial institution have a duty to file a CTR on currency transactions where the financial institution never physically receives the cash because it uses an armored car service to collect, transport and process its customer's cash receipts?
X State Bank (the “Bank”) and Acme Armored Car Service (“Acme”) have entered into a contract which provides for Acme to collect, transport and process revenues received from Bank customers:
Each day, Acme picks up cash, checks, and deposit tickets from Little Z, a non-exempt customer of the Bank. Recently, receipts of cash from Little Z have exceeded $10,000. Acme delivers the checks and deposit tickets to the Bank where they are processed and Little Z's account is credited. All cash collected, however, is taken by Acme to its central office where it is counted and processed. The cash is then delivered by Acme to the Federal Reserve Bank for deposit into the Bank's account. Must the Bank file a CTR to report a receipt of cash in excess of $10,000 by Acme from Little Z?
Yes. Since Acme is receiving cash in excess of $10,000 on behalf of the Bank, the Bank must file a CTR in order to report these transactions.
Section 103.22(a)(1) requires “(e)ach financial institution * * * [to] file a report of each deposit, withdrawal, exchange of currency or other payment or transfer, by, through or to such financial institution which involves a transaction in currency of more than $10,000.” Section 103.11 (a) and (g) defines “Bank” and “Financial Institution” to include agents of those banks and financial institutions.
Under the facts presented, Acme is acting as an agent of the Bank. This is because Acme and the Bank have a contractual relationship whereby the Bank has authorized Acme to pick up, transport and process Little Z's receipts on behalf of the Bank. The Federal Reserve Bank's acceptance of deposits from Acme into the Bank's account at the Fed, is additional evidence of the agency relationship between the Bank and Acme.
Therefore, when Acme receives currency in excess of $10,000 from Little Z, the Bank must report that transaction on Form 4789. Likewise, if Acme receives currency from Little Z in multiple transactions, § 103.22(a)(1) requires the Bank to aggregate these transactions and file a single CTR for the total amount of currency received by Acme, if the Bank has knowledge of these multiple transactions. Knowledge by the Bank's agent, i.e., Acme, that the currency was received in multiple transactions, is attributable to the Bank. The Bank must assure that Acme, as its agent, obtains all the information and identification necessary to complete the CTR.
Financial institutions must file a CTR for the currency received by an armored car service from the financial institution's customer when the armored car service physically receives the cash from the customer, transports it and processes the receipts, even though the currency may never physically be received by the financial institution. This is because the armored car service is acting as an agent of the financial institution.
Under § 103.22 of the BSA regulations, may a bank unilaterally grant one exemption or establish a single dollar exemption limit for a group of existing accounts of the same customer? If not, may a bank obtain additional authority from the IRS to grant a single exemption for a group of exemptible accounts belonging to the same customer?
ABC Inc. (“ABC”), with TIN 12-3456789, owns five fast food restaurants. Each restaurant has its own account at the X State Bank and each restaurant routinely deposits less than $10,000 into its individual account. However, when the deposits into these five accounts are aggregated they regularly and frequently exceed $10,000. Accordingly, the bank prepares and files one CTR for ABC Inc., on each business day that ABC's aggregated currency transactions exceed $10,000. X State Bank wants to know whether it can unilaterally exempt these five accounts having the same TIN, and, if not, whether it can obtain additional authority from the IRS to grant a single exemption to the group of five accounts belonging to ABC.
Under § 103.22(b)(2) (i) and (ii) of the Bank Secrecy Act (“BSA”) regulations, 31 CFR part 103, only an individual account of a customer may be unilaterally exempted from the currency transaction reporting provisions. The bank may not unilaterally grant one exemption or establish a single dollar exemption limit for multiple accounts of the same customer. This is because §§ 103.22(b)(2)(i) and 103.22(b)(2)(ii) of the BSA regulations only permit a bank to unilaterally exempt “[d]eposits or withdrawals of currency from an existing account by an established depositor who is a United States resident and operates a retail type of business in the United States.” 31 CFR 103.22(b)(2) (i) and (ii).
Section 103.22(e) of the BSA regulations provides, however, that “[a] bank may apply to the * * * [IRS] for additional authority to grant exemptions to the reporting requirements not otherwise permitted under paragraph (b) of this section * * *” 31 CFR 103.22(e). Therefore, under this authority, and at the request of a bank, the IRS may,
(1) Each of the accounts in the group is owned by the same person and has the same taxpayer identification number.
(2) The deposits or withdrawals into each account are made by a customer that operates a business that may be either unilaterally or specially exemptible and each account meets the other exemption criteria (except for the dollar amount).
(3) Currency transactions for each account individually do not exceed $10,000 on a regular and frequent basis.
(4) Aggregated currency transactions for all accounts included in the group regularly and frequently exceed $10,000.
If a bank determines that an exemption would be appropriate in a situation involving a group of accounts belonging to a single customer, it must apply to the IRS for authority to grant one special exemption covering the accounts in question. As with all requests for special exemptions, any request for additional authority to grant a special exemption must be made in writing and accompanied by a statement of the circumstances that warrant special exemption treatment and a copy of the statement signed by the customer as required by § 103.22(d). 31 CFR 103.22(d).
Additional authority to grant a special exemption for a group of accounts must be obtained from the IRS regardless of whether the businesses may be unilaterally exempted under § 103.22(b)(2), because the exemption, if granted, would apply to a group of existing accounts as opposed to an individual existing account. 31 CFR 103.22(b)(2).
Also, if any one of a given customer's accounts has regular and frequent currency transactions which exceed $10,000, that account may not be included in the group exemption. This is because the bank may, as provided by § 103.22(b)(2), either unilaterally exempt that account or obtain authority from the IRS to grant a special exemption for that account if it meets the other criteria for exemption. Thus, only accounts of exemptible businesses which do not have regular and frequent (
The intention of this special exemption is to permit banks to exempt the accounts of established customers, such as the ABC Inc. restaurants described above, which are owned by the same person and have the same TIN but which individually do not have sufficient currency deposit or withdrawal activity that regularly and frequently exceed $10,000.
If X State Bank determines that an exemption would be appropriate for ABC Inc., it must apply to the IRS for authority to grant one special exemption covering ABC's five separate accounts. As with all requests for special exemptions, ABC's request for additional authority to grant a special exemption must be made in writing and accompanied by a statement of the circumstances that warrant special exemption treatment and a copy of the statement signed by the customer as required by § 103.22(d). 31 CFR 103.22(d). The IRS may, in its discretion, grant additional authority to exempt the ABC accounts if: (1) They have the same taxpayer identification number; (2) they each are for customers that operate a business that may be either unilaterally or specially exemptible and each account meets the other exemption criteria (except for dollar amount); (3) the currency transactions for each account individually do not exceed $10,000 on a regular and frequent basis; but (4) when aggregated the currency transactions for all the accounts regularly and frequently do exceed $10,000.
When a customer has established bank accounts for each of several establishments that it owns, and the bank has exempted one or more of those accounts, how does the bank aggregate the customer's currency transactions?
X Company (“X”) operates two fast-food restaurants and a wholesale food business. X has opened separate bank accounts at the A National Bank (the “Bank”) for each of its two restaurants, account numbers 1 and 2 respectively. Each of these two accounts has been properly exempted by the bank. Account number 1 has an exemption limit of $25,000 for deposits, and account number 2 has an exemption limit of $40,000 for deposits. X also has a third account, account number 3, at the bank for use in the operation of its wholesale food business. On occasion, cash deposits of more than $10,000 are made into this third account. Because these cash deposits are infrequent, the bank cannot obtain additional authority to grant this account a special exemption.
During the same business day, two $15,000 cash deposits totalling $30,000 are made into account number 1, a separate cash deposit of $35,000 is made into account number 2 and a deposit of $9,000 in currency is made into account number 3 (X's account for its wholesale food business).
The bank must now determine how to aggregate and report all of these transactions
Section 103.22 of the Bank Secrecy Act (“BSA”), 31 CFR part 103, requires a financial institution to treat multiple currency transactions “as a single transaction if the financial institution has knowledge that they are by or on behalf of any person and result in either cash-in or cash-out totalling more than $10,000 during any one business day.” This means that a financial institution must file a CTR if it knows that multiple currency transactions involving two or more accounts have been conducted by or on behalf of the same person and, those transactions, when aggregated, exceed $10,000. Knowledge, in this context, means knowledge on the part of a partner, director, officer or employee of the institution or on the part of any existing computer or manual system at the institution that permits it to aggregate transactions.
Thus, if the bank has knowledge of multiple transactions, the bank should aggregate the transactions in the following manner.
First, the bank should separately review and total all cash-in and cash-out transactions within each account. Cash-in transactions should be aggregated with other cash-in transactions and cash-out transactions should be aggregated with cash-out transactions. Cash-in and cash-out transactions should not be aggregated together or offset against each other.
Second, the bank should determine whether the account has an exemption limit. If the account has an exemption limit, the bank should determine whether it has been exceeded. If the exemption limit has not been exceeded, the transactions for the exempted account should not be aggregated with other transactions.
If the total transactions during the same business day for a particular account exceed the exemption limit, the total of all of the transactions for that account should be aggregated with the total amount of the transactions for other accounts that exceed their respective exemption limits, with any accounts without exemption limits, and with transactions conducted by or on behalf of the same person that do not involve accounts (e.g., purchases of bank checks with cash) of which the bank has knowledge.
In the example discussed above, all of the transactions have been conducted “on behalf of” X, as X owns the restaurants and the wholesale food business. The total $30,000 deposit for account 1 exceeds the $25,000 exemption limit for that account. The $35,000 deposit into account number 2 is less than the $40,000 exemption limit for that account. Finally, the $9,000 deposit into account number 3, does not by itself constitute a reportable transaction.
Therefore, under the facts above, the bank should aggregate the entire $30,000 deposit into account number 1 (not just the amount that exceeds the exemption limit), with the $9,000 deposit into account number 3, for a total of $39,000. The bank should not include the $35,000 deposit into account number 2, as that deposit does not exceed the exemption limit for that account. Accordingly, the bank should complete and file a single CTR for $39,000.
If the bank does not have knowledge that multiple currency transactions have been conducted in these accounts on the same business day (e.g., because it does not have a system that aggregates among accounts and the deposits were made by three different individuals at different times) the bank should file one CTR for $30,000 for account number 1, as the activity into that account exceeds its exemption limit.
When a customer has more than one account and a bank employee has knowledge that multiple currency transaction have been conducted in the accounts or the bank has an existing computer or manual system that permits it to aggregate transactions for multiple accounts, the bank should aggregate the transactions in the following manner.
First, the bank should aggregate for each account all cash-in or cash-out transactions conducted during one business day. If the account has an exemption limit, the bank should determine whether the exemption limit of that account has been exceeded. If the exemption limit has not been exceeded, the total of the transactions for that particular account does not have to be aggregated with other transactions. If the total transactions during the same business day for a particular account exceed the exemption limit, however, the total of all of the transactions for that account should be aggregated with any total from other accounts that exceed their respective exemption limits, with any accounts without exemption limits, and with any reportable transactions conducted by or on behalf of the customer not involving accounts (e.g., purchases of bank checks or “cash back” transactions) of which the bank has knowledge. The bank should then file a CTR for the aggregated amount.
How does a financial institution fulfill the requirement that it furnish information
Under § 103.28 of the Bank Secrecy Act (“BSA”) regulations, 31 CFR part 103, a financial institution must report on a Currency Transaction Report (“CTR”) the name and address of the individual conducting the transaction, and the identity, account number, and the social security or taxpayer identification number of any person on whose behalf the transaction was conducted. See 31 U.S.C. 5313. “A participant acting for another person shall make the report as the agent or bailee of the person and identify the person for whom the transaction is being made.” Identifying information about the person on whose behalf the transaction is conducted must always be furnished if the transaction is reportable under the BSA, regardless of whether the transaction involves an account.
Because the BSA requires financial institutions to file complete and accurate CTR's, it is the financial institution's responsibility to ascertain the real party in interest. 31 U.S.C. 5313. One way that a financial institution can obtain information about the identity of the person on whose behalf the transaction is being conducted is to ask the person conducting the transaction whether he is acting for himself or on behalf of another person. Only if as a result of strong “know your customer” or other internal control policies, the financial institution is satisfied that its records contain information concerning the true identity of the person on whose behalf the transaction is conducted, may the financial institution rely on those records to complete the CTR.
It is the responsibility of a financial institution to file complete and accurate CTRs.
Identification of elderly or disabled patrons conducting large currency transactions. Financial institutions must file a form 4789, Currency Transaction Report (CTR) on transactions in currency in excess of $10,000, and must verify and record information about the identity of the person(s) who conduct(s) the transaction in Part I of the CTR. Financial institutions also must record on a chronological log sales of, and verify the identity of individuals who purchase, certain monetary instruments with currency in amounts between $3,000 and $10,000, inclusive. Many financial institutions have asked Treasury how they can meet the requirement to examine an identifying document that contains the person's name and address when s/he does not possess such a document (
How does a financial institution fulfill the requirement to verify and record the name and address of an elderly or disabled individual who conducts a currency transaction in excess of $10,000 or who purchases certain monetary instruments with currency valued between $3,000 and $10,000 when he/she does not possess a passport, alien identification card or other official document, or other document that is normally acceptable within the banking community as a means of identification when cashing checks for nondepositors?
It is the responsibility of a financial institution to file complete and accurate CTRs and to maintain complete and accurate monetary instrument logs pursuant to 31 CFR §§ 103.27(d) and 103.29 of the BSA regulations. It is also the responsibility of a financial institution to verify and to record the identity of individuals conducting reportable currency transactions and/or cash purchases of certain monetary instruments as required by BSA regulations §§ 103.28 and 103.29. Only if the financial institution is confident that an elderly or disabled patron is who s/he says s/he is may it complete these transactions. A financial institution shall use whatever information it has available, in accordance with its established policies and procedures, to determine its patron's identity. This includes review of its internal records for any information on file, and asking for other forms of identification, including a social security or medicare/medicaid card along with another document which contains both the patron's name and address such as an organizational membership card, voter registration card, utility bill or real estate tax bill. These forms of identification shall also be identified as acceptable in the bank's formal written policy and operating procedures as identification for transactions involving the elderly or the disabled. Once implemented, the financial institution should permit no exception to its policy and procedures. In these cases, the financial institution should record the word “Elderly” or “Disabled” on the CTR and/or chronological log and the method used to identify the elderly, or disabled patron such as “Social Security and (organization) Membership Card only ID.”
Before concluding a transaction for which a Currency Transaction Report is required pursuant to 31 CFR 103.22, a financial institution must verify and record the name and address of the individual conducting the transaction. 31 CFR 103.28. Verification of the individual's identity must be made by examination of a document, other than a bank signature card, that is normally acceptable within the banking community as a means of identification when cashing checks for nondepositors (
Before issuing or selling bank checks or drafts, cashier's checks, traveler's checks or money orders to an individual(s), for currency between $3,000 and $10,000, a financial institution must verify whether the individual has a deposit account or verify the individual's identity. 31 CFR 103.29. Verification may be made by examination of a signature card or other account record at the financial institution if the deposit accountholder's name and address were verified at the time the account was opened, or at any subsequent time, and that information was recorded on the signature card or record being examined.
Verification may also be made by examination of a document that contains the name and address of the purchaser and which is normally acceptable within the banking community as a means of identification when cashing checks for nondepositors. In the case of a deposit accountholder whose identity has not been previously verified, the financial institution shall record the specific identifying information on its chronological log (
Certain elderly or disabled patrons do not possess identification documents that would normally be considered acceptable within the banking community (
Financial institutions may accept as appropriate identification a social security, medicare, medicaid or other insurance card presented along with another document that contains both the name and address of the patron (
This procedure may only be applied if the following circumstances exist. First, the financial institution must establish that the identification the elderly or disabled patron has is limited to a social security or medicare/medicaid card plus another document which contains the patron's name and address. Second, the financial institution must use whatever information it has available, or policies and procedures it has in place, to determine the patron's identity. If the patron is a deposit accountholder, the financial institution should review its internal records to determine if there is information on file to verify his/her identity. Only if the financial institution is confident that the elderly or disabled patron is who s/he says s/he is, may the transaction be concluded. Failure to identify an elderly or a disabled customer's identity as required by 31 CFR § 103.28 and as described herein may result in the imposition of civil and or criminal penalties. Finally, the financial institution shall establish a formal written policy and implement operating procedures for processing reportable currency transactions or recording cash sales of certain monetary instruments to elderly or disabled patrons who do not have forms of identification ordinarily considered “acceptable.” Once implemented, the financial institution shall permit no exceptions to its policy and procedures. In addition, financial institutions are encouraged to record the elderly or disabled patron's identity and address as well as the method of identification on a signature card or other record when it is obtained and verified.
In completing a CTR, if all of the above conditions are satisfied, the financial institution should enter the words “Elderly” or “Disabled” and the method used to verify the patron's identity, such as “Social Security and (organization) Membership Cards Only ID,” in Item 15a.
Similarly, when logging the cash purchase of a monetary instrument(s), the financial institution shall enter on its chronological log the words, “Elderly” or “Disabled,” and the method used to verify such patron's identity.
Jesse Fleming, a 75 year old retiree, has been saving $10 bills for twenty years in order to help pay for his granddaughter's college education. He enters the Trustworthy National Bank where he has no account but his granddaughter has a savings account, and presents $13,000 in $10 bills to the teller. He instructs the teller to deposit $9,000 into his granddaughter's savings account, and requests a cashier's check for $4,000 made payable to State University.
Because of poor eyesight, Mr. Fleming no longer drives and does not possess a valid driver's license. When asked for identification by the teller he presents a social security card and his retirement organization membership card that contains his name and address.
In this example, the Trustworthy National Bank must check to determine if Mr. Fleming's social security and organizational membership cards are acceptable forms of
How should a financial institution complete a CTR when multiple transactions are aggregated and reported on a single form and all or part of the information called for in the form may not be known?
Multiple transactions that total in excess of $10,000, or an established exemption limit, when aggregated must be reported on a CTR if the financial institution has knowledge that the transactions have occurred. In many cases, the individual transactions being reported are each under $10,000, or the exemption limit, and the institution was not aware at the time of any one of the transactions that a CTR would be required. Therefore, the identifying information on the person conducting the transaction was not required to be obtained at the time the transaction was conducted.
If after a reasonable effort to obtain the information required to complete items 4 through 15 of the CTR, all or part of such information is not available, the institution must check item 3d to indicate that the information is not being provided because the report involves multiple transactions for which complete information is not available. The institution must, however, provide as much of the information as is reasonably available.
All subsections of item 48 on the CTR must be completed to report the number of transactions involved and the number of locations of the financial institution and zip codes of those locations where the transactions were conducted.
Sections 103.22(a)(1) and (c) of the Bank Secrecy Act (BSA) regulations, 31 CFR part 103, require a financial institution to file a CTR for each deposit, withdrawal, exchange of currency, or other payment or transfer, by, through, or to the financial institution, which involves a transaction in currency of more than $10,000 or the established exemption limit for an exempt account. Multiple transactions must be treated as a single transaction if the financial institution has knowledge that they are by, or on behalf of, any person and result in either cash in or cash out of the financial institution totalling more than $10,000 or the exemption limit during any one business day. Knowledge, in this context, means knowledge on the part of a partner, director, officer or employee of the financial institution or on the part of any existing automated or manual system at the financial institution that permits it to aggregate transactions.
The purpose of item 3 on the CTR is to indicate why all or part of the information required in items 4 through 15 is not being provided on the form. If the reason information is missing is solely because the transaction(s) occurred through an armored car service, a mail deposit or shipment, or a
As described in Example No. 5 below, there may be situations where one transaction among several exceeds the applicable threshold. Item 3d should be checked whenever multiple transactions are being reported and all or part of the information necessary to complete items 4 through 15 is not available because at the time of any one of the individual transactions, a CTR was not required and the financial institution did not obtain the appropriate information.
When reporting multiple transactions, the financial institution must complete as many of items 4 through 15 as possible. In the event the institution learns that more than one person conducted the multiple transactions being reported, it must check item 2 on the CTR and is encouraged to make reasonable efforts to obtain and report any appropriate information on each of the persons in items 4 through 15 on the front and back of the CTR form, and if necessary, on additional sheets of paper attached to the report.
The purpose of item 48 is to indicate that multiple transactions are involved in the CTR being filed. Items 48 a, b, and c require information about the number of transactions being reported and the number of bank branches and the zip code of each branch where the transactions took place. If multiple transactions exceeding $10,000 or an account exemption limit occur at the same time, the financial institution should treat the transactions in a manner consistent with its internal transaction posting procedures. For example, if a customer presents four separate deposits, at the same time, totalling over $10,000, the institution may report the transactions in item 48a to be one or four separate transactions. If the transactions are posted as four separate transactions the financial institution should enter the number 4 in item 48a and the number 1 in item 48b. If the transactions are posted as one transaction the institution should enter the 1 in both 48a and 48b. Reporting the transactions in this manner will guarantee the integrity of the paper trail being created, that is, the number of transactions reported on the CTR will be the same as the number of transactions showing in the institution's records.
These situations should be differentiated from those cases where separate transactions occur at different times during the same business day, and which, when aggregated, exceed $10,000 or the exemption limit. For instance, if the same or another individual conducts two of the same type of transactions at different times during the same business day at two different branches of the financial institution on behalf of the same person, and the institution has knowledge that the transactions occurred and exceed $10,000 or the exemption limit, then the financial institution must enter the number 2 in items 48a and 48b.
Dorothy Fishback presents a teller with three cash deposits to the same account, at the same time, in amounts of $5,000, $6,000, and $8,500 requesting that the deposits be posted to the account separately. It is the bank's procedure to post the transactions separately. A CTR is completed while the customer is at the teller window.
A CTR is completed based upon the information obtained at the time Dorothy Fishback presents the multiple transactions. Item 3d would not be checked on the CTR because all of the information in items 4 through 15 is being provided contemporaneously with the transaction. As it is the bank's procedure to post the transactions separately, the number of transactions reported in item 48a would be 3 and the number of branches reported in item 48b would be 1. The zip code for the location where the transactions were conducted would be entered in item 48c.
Andrew Weiner makes a $7,000 cash deposit to his account at ABC Federal Savings Bank. Later the same day, Mr. Weiner returns to the same teller and deposits $5,000 in cash to a different account. At the time Mr. Weiner makes the second deposit, the teller realizes that the two deposits exceed $10,000 and prepares a CTR obtaining all of the necessary identifying information directly from Mr. Weiner.
Even though the two transactions were conducted at different times during the same business day, Mr. Weiner conducted both transactions at the same place and the appropriate identifying information was obtained by the teller at the time of the second transaction. Item 3d would not be checked on the CTR. The number of transactions reported in item 48a must be 2 and the number of branches reported in item 48b would be 1. The zip code for the location where the transactions took place would be entered in item 48c.
Internal auditor Mike Pelzer is reviewing the daily cash transactions report for People's Bank and notices that five cash deposits were made the previous day to account
Having reviewed the report of aggregated transactions, Mike Pelzer has knowledge that transactions exceeding the account exemption limit have occurred during a single business day. A CTR must be filed. People's Bank is encouraged to make a reasonable effort to provide the information for items 4 through 15 on the CTR. Such efforts could include a search of the institution's records or a phone call to the department store to identify the persons that conducted the transactions. If all of the information is not contained in the institution's records or otherwise obtained, item 3d must be checked. The number of transactions reported in item 48a must be 5 and the number of branches reported in 48b would be 3. The zip codes for the three locations where the transactions occurred must be entered in item 48c.
Mrs. Saunders makes a cash withdrawal, for $4,000, from a joint savings account she owns with her husband. That day her husband, Mr. Saunders, withdraws $7,000 cash using the same teller. Realizing that the withdrawals exceed $10,000, the teller obtains identifying information on Mr. Saunders required to complete a CTR.
In this case, item 2 on the CTR must be checked because the teller knows that more than one person conducted the transactions. Information on Mr. Saunders would appear in Part I and the bank is encouraged to ask him for, or to check its records for the required identifying information on Mrs. Saunders. If after taking reasonable efforts to locate the desired information, all of the required information is not found on file in the institution's records or is not otherwise obtained, box 3d must be checked to indicate that all information is not being provided because multiple transactions are being reported. Whatever information on Mrs. Saunders is contained in the records of the institution must be reported in the continuation of Part I on the back of Form 4789. The number of transactions reported in item 48a must be 2 and the number of branches reported in item 48b would be 1. The zip code for the branch where the transactions took place would be entered in item 48c.
On another day, Mrs. Saunders makes a deposit of $3,000 cash and no information required for Part I of the CTR is requested of her. She is followed later the same day by her husband, Mr. Saunders, who deposits $12,000 in currency and who provides all data required to complete Part I for himself.
Item 2 on the CTR must be checked because the teller knows that more than one person conducted the transactions. Information on Mr. Saunders would appear in Part I and the bank is encouraged to ask him for, or to check its records for the required identifying information on Mrs. Saunders. If after taking reasonable efforts to locate the desired information, all of the required information is not found on file in the institution's records or is not otherwise obtained, box 3d must be checked to indicate that all information is not being provided because multiple transactions are being reported. Whatever information on Mrs. Saunders is contained in the records of the institution must be reported in the continuation of Part I on the back of Form 4789. The number of transactions reported in item 48a must be 2 and the number of branches reported in item 48b would be 1. The zip code for the branch where the transactions took place would be entered in item 48c.
A review of First Federal Bank's daily cash transactions report for a given day indicates several cash deposits to a single account totaling more than $10,000. Two separate deposits were made in the night depository at the institution's main office, and two deposits were conducted at the teller windows of two other branch locations. Each deposit was under $10,000.
Item 3c should be checked to indicate that identifying information is not provided because transactions were received through the night deposit box. If the tellers involved with the two face to face deposits remember who conducted the transactions, institution records can be checked for identifying information. If the records contain some of the information required by items 4 through 15, that information must be provided, and item
22 U.S.C. 286f and 3101
(a)
(i) United States claims on, and liabilities to, foreigners;
(ii) Transactions in securities and other financial assets with foreigners; and
(iii) The monetary reserves of the United States.
(2) Data pertaining to direct investment transactions are not required to be reported under this Part.
(3) Reports shall be made in such manner and at such intervals as specified by the Secretary of the Treasury. See subpart B of this part for additional requirements concerning these reports.
(b)
(i) Transactions in foreign exchange;
(ii) Transfers of credit that are, in whole or part, denominated in a foreign currency; and
(iii) The creation or acquisition of claims that reference transactions, holdings, or evaluations of foreign exchange.
(2) Reports shall be made in such manner and at such intervals as specified by the Secretary. See subpart C of this part for additional requirements concerning these reports.
(c)
(a)
(ii) Copies of forms and instructions prescribed by the Secretary for reporting under this Part may be obtained from any Federal Reserve Bank, or from the Office of the Assistant Secretary (Economic Policy), Department of the Treasury, Washington, DC 20220.
(2)
(b)
(2)
(3)
(c)
(a) Except for use in violation and enforcement proceedings pursuant to the International Investment and Trade in Services Survey Act, 22 U.S.C. 3101
(b) The information submitted by any individual respondent on reports required under subpart C of this part will not be disclosed publicly. Aggregated data may be published or disclosed only in a manner which will not reveal the information reported by any individual respondent. The Department may furnish to Federal agencies, the Board of Governors of the Federal Reserve System, and to Federal Reserve district banks data reported pursuant to subpart C of this part to the extent permitted by applicable law.
(a) Whoever fails to file a report required by subpart B of this part shall be subject to a civil penalty of not less than $2,500 and not more than $25,000
(b) Whoever willfully fails to file a report required by subpart B of this part may be criminally prosecuted and upon conviction fined not more than $10,000 and, if an individual (including any officer, director, employee, or agent of any corporation who knowingly participates in such violation), may be imprisoned for not more than one year, or both.
(c) Whoever fails to file a report required by subpart C of this part shall be subject to a civil penalty of not more than $10,000.
Banks, other depository institutions, International Banking Facilities, bank holding companies, brokers and dealers, and nonbanking enterprises subject to the jurisdiction of the United States shall maintain all information necessary to make a complete report pursuant to this Part for not less than three years from the date such report is required to be filed or was filed, whichever is later, or for such shorter period as may be specified in the instructions to the applicable report form.
Reports on international capital transactions and positions provide timely and reliable information on international portfolio capital movements by U.S. persons. This information is needed for preparation of the capital accounts of the United States balance of payments and the international investment position of the United States.
(a)
(2) Nonbanking enterprises in the United States not described in § 128.12(a)(1) shall file monthly and quarterly reports with respect to deposits and certificates of deposit with banks outside the United States and specified claims and liabilities positions with unaffiliated foreigners.
(b)
(c)
The Secretary may prescribe special survey reports at such times as the Secretary determines there is a need for detailed information on the aggregate data derived from current periodic reports or to provide additional qualitative information with respect to such data. Notice of special survey reports will be published in accordance with § 128.1(c).
Reports by respondents on foreign currency positions provide data on the nature and source of flows of mobile capital, including transactions by large United States business enterprises (as determined by the Secretary) and their foreign affiliates as required by 31 U.S.C. 5315.
Respondents shall file reports weekly, monthly and quarterly on the value of such items as outstanding foreign exchange contracts, dealing positions,
The Secretary may prescribe special survey reports with respect to foreign exchange positions and related information at such times as the Secretary determines that there is a need for prompt or expanded information on current conditions in the foreign exchange markets. Notice of special survey reports will be published in accordance with § 128.1(c).
In an action dated September 7, 1965, the National Advisory Council on International Monetary and Financial Problems made the following determination pursuant to section 2(a) of E.O. 10033 of February 8, 1949.
Action No. 320, March 17, 1949 is superseded by this determination and is hereby revoked.
II. Designation of the Treasury Department by the Director of the Bureau of the Budget pursuant to section 2(b) of E.O. 10033.
On December 1, 1965, the Treasury Department was designated, pursuant to section 2(b) of E.O. 10033 of February 8, 1949, to collect information for the International Monetary Fund under the National Advisory Council determination of September 7, 1965. The letter containing the designation reads as follows:
Dear Mr. Secretary: On September 7, 1965, the National Advisory Council after consultation with this Bureau in accordance with section 2(a) of Executive Order 10033, made the following determination (Action 65 (E.O.)-49:
“The National Advisory Council, having consulted with the Director of the Bureau of the Budget, determines that current information with respect to international capital movements, derived from data on U.S. liabilities to claims on foreigners and transactions in securities with foreigners, and current information with respect to U.S. gold holdings, foreign-currency holdings, and dollar liabilities to foreigners, are essential in order that the United States may comply with official requests of the International Monetary Fund for information with respect to the U.S. balance of payments and monetary reserves.”
It is hereby determined pursuant to section 2(b) of Executive Order 10033, that the Treasury Department shall collect information pertaining to capital movements between the United States and foreign countries and pertaining to the monetary reserves of the United States, except information pertaining to direct-investment transactions, U.S. Government foreign lending operations, and claims and liabilities of U.S. Government agencies (other than public debt obligations), which is collected by the Department of Commerce.
This letter supersedes the earlier determination as to the responsibilities of the Treasury Department in this area, dated April 21, 1949, as amended May 4, 1950.
22 U.S.C. 3101 et seq.; E.O. 11961, 42 FR 4321, 3 CFR, 1977 Comp., p. 86.
The purpose of this part is to provide general information on portfolio investment survey data collection programs and analyses under the International Investment and Trade in Services Survey Act ((formerly the International Investment Survey Act of 1976) (the “Act”)). The purpose of the Act is to provide for the collection of comprehensive and reliable information concerning international investment, including portfolio investment. The Act specifies that regular data collection programs and surveys specified by the Act or deemed necessary by the Secretary of the Treasury shall be conducted to secure information on international capital flows and other information related to international portfolio investment, including information that may be necessary for computing and analyzing the United States balance of payments.
For purposes of the Act and for reporting requirements under this Part:
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(a) Notice of specific reporting requirements, including who is required to report, the information to be reported, the manner of reporting, and the time and place of filing reports, will be published by the Secretary of the Treasury in the
(b) Written responses are required from all reporters.
(c) Information required from reporters shall be furnished under oath.
Reporters shall maintain all information used in preparing a report under this part for the period specified in the notice published by the Secretary of the Treasury pursuant to section 129.3, and shall make this information available for review and inspection at the request of the Department of the Treasury.
(a) Information collected pursuant to the Act will be kept in confidence.
(b) Access to information collected pursuant to the Act shall be available only to officials and employees (including consultants and contractors and their employees) designated by the Secretary of the Treasury to perform functions under the Act.
(c) Nothing in this part shall be construed to require any Federal agency to disclose information otherwise protected by law.
(d) No person can compel the submission or disclosure of reports, or constituent parts thereof, or copies of such reports or constituents parts thereof, prepared pursuant to this part, without the prior written consent of the person who maintained or who furnished the report and the customer of the person who furnished the report, where the information supplied is identifiable as being derived from the records of the customer. As required by the Act, any published reports issued by the Treasury based upon information pursuant to this part will only contain data aggregated in such a way that neither the person supplying the information nor the investor can be identified.
Reporters are advised that the Act provides the following penalties:
(a)
(b)
A list of CFR titles, subtitles, chapters, subchapters and parts and an alphabetical list of agencies publishing in the CFR are included in the CFR Index and Finding Aids volume to the Code of Federal Regulations which is published separately and revised annually.
Material Approved for Incorporation by Reference
Table of CFR Titles and Chapters
Alphabetical List of Agencies Appearing in the CFR
Redesignation Table
List of CFR Sections Affected
The Director of the Federal Register has approved under 5 U.S.C. 552(a) and 1 CFR Part 51 the incorporation by reference of the following publications. This list contains only those incorporations by reference effective as of the revision date of this volume. Incorporations by reference found within a regulation are effective upon the effective date of that regulation. For more information on incorporation by reference, see the preliminary pages of this volume.
At 54 FR 4957, Jan. 31, 1989, §§ 601.901—601.942 (subpart I), formerly appearing in title 26, part 601, were redesignated as part 19 of title 31.
For the convenience of the user, the following table shows the relationship of the redesignated sections.
All changes in this volume of the Code of Federal Regulations which were made by documents published in the Federal Register since January 1, 1986, are enumerated in the following list. Entries indicate the nature of the changes effected. Page numbers refer to Federal Register pages. The user should consult the entries for chapters and parts as well as sections for revisions.
For the period before January 1, 1986, see the “List of CFR Sections Affected, 1949-1963, 1964-1972, and 1973-1985” published in seven separate volumes.