Reporting, Procedures and Penalties Regulations and Sudanese Sanctions Regulations, 34060-34064 [05-11637]
Download as PDF
<![CDATA[
34060
Federal Register / Vol. 70, No. 112 / Monday, June 13, 2005 / Rules and Regulations
(e) * * *
(7) The vessel does not fish for,
possess or land NE multispecies, except
that Category 1 herring vessels may
possess and land haddock consistent
with the incidental catch allowance and
bycatch cap specified in § 648.86(a)(3).
(8) All Category 1 herring vessels
must notify NMFS Office of Law
Enforcement through VMS of the time
and place of offloading at least 12 hours
prior to crossing the VMS demarcation
line on their return trip to port, or, for
vessels that have not fished seaward of
the VMS demarcation line, at least 12
hours prior to landing. If a fishing trip
is less than 12 hours in length, Category
1 herring vessels must notify NMFS
Office of Law Enforcement through
VMS of the time and place of offloading
at least 6 hours prior to crossing the
VMS demarcation line on their return
trip to port, or, for vessels that have not
fished seaward of the VMS demarcation
line, at least 6 hours prior to landing.
The Regional Administrator may adjust
the prior notification minimum time
through publication of a notice in the
Federal Register consistent with the
Administrative Procedure Act.
*
*
*
*
*
I 6. In § 648.83, paragraph (b)(4) is
added to read as follows:
§ 648.83
Multispecies minimum fish sizes.
*
*
*
*
*
(b) * * *
(4) Category 1 herring vessels may
possess and land haddock that measure
less than the minimum fish size,
consistent with the haddock incidental
catch allowance and bycatch cap
specified in § 648.86(a)(3).
*
*
*
*
*
I 7. In § 648.86, paragraph (a)(3) is added
to read as follows:
§ 648.86 Multispecies possession
restrictions.
*
*
*
*
*
(a) * * *
(3)(i) Incidental catch allowance for
herring Category 1 vessels. Category 1
herring vessels defined in § 648.2 may
possess and land up to 1,000 lb (454 kg)
of haddock per trip, subject to the
requirements specified in § 648.80(d)
and (e).
(ii) Bycatch cap. (A) When the
Regional Administrator has determined
that 270,000 lb (122,470 kg) of observed
and reported haddock have been
landed, NMFS shall prohibit Category 1
herring vessels from entering or fishing
in the GB haddock stock area defined by
the coordinates specified in paragraph
(b)(6)(v)(B) of this section for GB cod
through a notice in the Federal Register
VerDate jul<14>2003
15:44 Jun 10, 2005
Jkt 205001
consistent with rulemaking
requirements of the Administrative
Procedure Act. In making this
determination, the Regional
Administrator shall use only haddock
landings observed by NMFS approved
observers and law enforcement officials,
and reports of haddock bycatch
submitted by vessels and dealers
pursuant to the reporting requirements
of this part.
(B) Upon the effective date of
prohibiting Category 1 herring vessels
from entering or fishing in the GB
haddock stock area as described in
paragraph (a)(3)(ii)(A) of this section,
the haddock possession limit is reduced
to 0 lb (0 kg) for all Category 1 herring
vessels.
*
*
*
*
*
[FR Doc. 05–11593 Filed 6–7–05; 4:49 pm]
BILLING CODE 3510–22–S
DEPARTMENT OF THE TREASURY
Office of Foreign Assets Control
31 CFR Parts 501 and 538
Reporting, Procedures and Penalties
Regulations and Sudanese Sanctions
Regulations
Office of Foreign Assets
Control, Treasury.
ACTION: Final rule.
AGENCY:
SUMMARY: The Office of Foreign Assets
Control (‘‘OFAC’’) of the U.S.
Department of the Treasury is revising
the Reporting, Procedures and Penalties
Regulations (the ‘‘RPPR’’) to make a
technical change in order to remove a
reference to the Government of Sudan
that was used prior to the promulgation
of Executive Order 13067 and the
Sudanese Sanctions Regulations.
OFAC is also amending the Sudanese
Sanctions Regulations, (the ‘‘SSR’’). The
amendments to the SSR include the
issuance of two general licenses,
effective June 13, 2005. One general
license authorizes the operation of
accounts in U.S. financial institutions
under certain circumstances for
individuals ordinarily resident in
Sudan. The other general license
authorizes U.S. depository institutions,
U.S. registered brokers and dealers in
securities, and U.S. registered money
transmitters to process transfers of funds
constituting noncommercial, personal
remittances to or from Sudan or for or
on behalf of individuals ordinarily
resident in Sudan. Other amendments to
the SSR include the removal of two
regulatory provisions and the revision of
a provision regarding reexportation of
PO 00000
Frm 00006
Fmt 4700
Sfmt 4700
U.S.-origin goods, technology or
software by non-U.S. persons, and
another revision of to reflect changes in
OFAC’s procedure for imposing civil
penalties.
DATES: Effective Date: June 13, 2005.
FOR FURTHER INFORMATION CONTACT:
Chief of Compliance Programs, tel.: 202/
622–2490, Chief of Civil Penalties, tel.:
202/622–6140, Chief of Licensing, tel.:
202/622–2480, Chief of Policy Planning
and Program Management, tel.: 202/
622–4855, or Chief Counsel, tel.: 202/
622–2410, Office of Foreign Assets
Control, Department of the Treasury,
Washington, DC 20220.
SUPPLEMENTARY INFORMATION:
Electronic and Facsimile Availability
This file is available for download
without charge in ASCII and Adobe
Acrobat readable (*.PDF) formats at
GPO Access. GPO Access supports
HTTP, FTP, and Telnet at
fedbbs.access.gpo.gov. It may also be
accessed by modem dialup at 202/512–
1387 followed by typing ‘‘/GO/FAC.’’
Paper copies of this document can be
obtained by calling the Government
Printing Office at 202–512–1530.
Additional information concerning the
programs of the Office of Foreign Assets
Control is available for download from
the Office’s Internet Home Page at:
https://www.treas.gov/ofac or via FTP at
ofacftp.treas.gov. Facsimiles of
information are available through the
Office’s 24-hour fax-on-demand service:
call 202/622–0077 using a fax machine,
a fax modem, or (within the United
States) a touch-tone telephone.
Background
On November 3, 1997, President
Clinton, invoking the authority, inter
alia, of the International Emergency
Economic Powers Act (50 U.S.C. 1701–
1706), issued Executive Order 13067 (62
FR 59989, November 5, 1997). The order
declared a national emergency with
respect to the policies and actions of the
Government of Sudan, ‘‘including
continued support for international
terrorism; ongoing efforts to destabilize
neighboring governments; and the
prevalence of human rights violations,
including slavery and the denial of
religious freedom.’’ To deal with this
national emergency, Executive Order
13067 imposed trade sanctions with
respect to Sudan and blocked all
property and interests in property of the
Government of Sudan in the United
States or within the possession or
control of U.S. persons. The Sudanese
Sanctions Regulations, 31 CFR part 538
(the ‘‘SSR’’), implement Executive Order
13067.
E:\FR\FM\13JNR1.SGM
13JNR1
Federal Register / Vol. 70, No. 112 / Monday, June 13, 2005 / Rules and Regulations
The Reporting, Procedures and
Penalties Regulations, 31 CFR part 501
(the ‘‘RPPR’’), set forth uniform
reporting and procedural requirements
applicable to all OFAC sanctions
programs. OFAC is amending the RPPR
to make a technical change to § 501.604
by removing a reference to the
Government of Sudan from that section.
Section 501.604(b) uses the Government
of Sudan in an example of transactions
involving funds transfers that are
rejected, but not blocked. This example,
however, was published before the
issuance of Executive Order 13067 and
OFAC’s promulgation of the SSR.
Executive Order 13067 and the SSR
require U.S. financial institutions to
block unlicensed funds transfers
involving the Government of Sudan.
OFAC is also amending provisions of
the SSR dealing with the transfer of
funds to Sudan. First, the SSR are being
amended by the removal of § 538.413,
an interpretive provision stating that the
transfer of funds to Sudan from the
United States does not constitute an
exportation of services pursuant to
§ 538.205. As a result of the removal of
§ 538.413, money transmittal services to
Sudan are prohibited except as
otherwise authorized.
Second, to authorize a means by
which noncommercial, personal
transmittals of money to Sudan may
take place in a manner consistent with
Executive Order 13067, OFAC is
amending the SSR by issuing a general
license, effective June 13, 2005. This
general license, new § 538.528,
authorizes U.S. depository institutions,
U.S. registered brokers and dealers in
securities, and U.S. registered money
transmitters to process transfers of funds
constituting noncommercial, personal
remittances under certain circumstances
to or from Sudan or for or on behalf of
individuals ordinarily resident in
Sudan. The general license does not
authorize transfers if the underlying
transaction is otherwise prohibited by
subpart B of the SSR. Definitions of
‘‘U.S. depository institution,’’ ‘‘U.S.
registered broker or dealer in
securities,’’ and ‘‘U.S. registered money
transmitter’’ are added to subpart C of
the SSR to clarify the scope of the
general license.
Third, § 538.412, an interpretive
provision stating that the operation of
accounts in financial institutions for
private Sudanese persons does not
constitute the exportation of a service to
Sudan, is removed from subpart D of the
SSR. The content of this section appears
in revised form in subpart E as a new
general license, § 538.527, effective June
13, 2005. Section 538.527 authorizes the
operation of accounts in U.S. financial
VerDate jul<14>2003
15:44 Jun 10, 2005
Jkt 205001
institutions for individuals ordinarily
resident in Sudan, provided that
transactions through the accounts are of
a personal nature. The section does not
authorize account transactions for use in
supporting or operating a business; nor
does it authorize transfers of funds to
Sudan or to or for the benefit of
individuals ordinarily resident in Sudan
unless authorized by § 538.528. The
section also does not authorize
transactions that are otherwise
prohibited by subpart B of the SSR.
In addition to the changes described
above, § 538.507 of the SSR is also
revised to clarify the circumstances
under which the reexportation of goods,
technology or software of U.S. origin to
Sudan or the Government of Sudan by
a non-U.S. person is authorized.
Finally, §§ 538.701–.704 of the SSR
are amended to reflect changes in
OFAC’s procedure for imposing or
settling civil penalties. Sections
538.701–.704 set forth the procedure by
which civil penalties will be issued or
settled, as well as guidelines for
responding to a prepenalty notice. The
amendments do not affect the maximum
penalty amounts that the SSR authorize.
Public Participation
Because the Regulations involve a
foreign affairs function, the provisions
of Executive Order 12866 and the
Administrative Procedure Act (5 U.S.C.
553) (the ‘‘APA’’) requiring notice of
proposed rulemaking, opportunity for
public participation, and delay in
effective date are inapplicable. Because
no notice of proposed rulemaking is
required for this rule, the Regulatory
Flexibility Act (5 U.S.C. 601–612) does
not apply. However, OFAC encourages
interested persons who wish to
comment to do so in writing by any of
the following methods:
• Agency Web site: https://
www.treas.gov/offices/enforcement/
ofac/comment.html.
• Fax: Chief of Records, 202/622–
1657.
• Mail: Chief of Records, Attn:
Request for Comments, Office of Foreign
Assets Control, Department of the
Treasury, 1500 Pennsylvania Avenue,
NW., Washington, DC 20220.
OFAC will not accept public
comments in languages other than
English or accompanied by a request
that a part or all of the submission be
treated confidentially because of its
business proprietary nature or for any
other reason. OFAC will return any such
submission to the originator. All public
comments on these Regulations will be
a matter of public record. Copies of the
public record concerning these
Regulations will be made available not
PO 00000
Frm 00007
Fmt 4700
Sfmt 4700
34061
sooner than September 12, 2005 and
will be obtainable from OFAC’s Web
site (https://www.treas.gov/ofac). If that
service is unavailable, written requests
for copies may be sent to: Office of
Foreign Assets Control, U.S. Department
of the Treasury, 1500 Pennsylvania
Ave., NW., Washington, DC 20220, Attn:
Chief, Records Division.
Paperwork Reduction Act
The collections of information related
to 31 CFR part 501 and 31 CFR part 538
are contained in 31 CFR part 501 (the
‘‘Reporting, Procedures and Penalties
Regulations’’). Pursuant to the
Paperwork Reduction Act of 1995 (44
U.S.C. 3507), those collections of
information have been approved by the
Office of Management and Budget under
control number 1505–0164. An agency
may not conduct or sponsor, and a
person is not required to respond to, a
collection of information unless the
collection of information displays a
valid control number.
List of Subjects
31 CFR Part 501
Administrative practice and
procedure, Banks, Banking, Blocking of
assets, Information, Investments, Loans,
Penalties, Reporting and recordkeeping
requirements, Services, Specially
designated nationals, Sudan, Terrorism.
31 CFR Part 538
Administrative practice and
procedure, Agricultural commodities,
Banks, Banking, Blocking of assets,
Drugs, Exports, Foods, Foreign trade,
Humanitarian aid, Imports, Information,
Investments, Loans, Medical devices,
Medicine, Penalties, Reporting and
recordkeeping requirements, Services,
Specially designated nationals, Sudan,
Terrorism, Transportation.
For the reasons set forth in the
Preamble, 31 CFR parts 501 and 538 are
amended as follows:
I
PART 501—REPORTING,
PROCEDURES AND PENALTIES
REGULATIONS
1. The authority citation for part 501
continues to read as follows:
I
Authority: 21 U.S.C. 1901–1908; 22 U.S.C.
287c; 31 U.S.C. 321(b); 50 U.S.C. 1701–1706;
50 U.S.C. App. 1–44.
2. Section 501.604 is amended by
revising paragraph (b) (3) to read as
follows:
I
§ 501.604 Reports by U.S. financial
institutions on rejected funds transfers.
*
*
*
(b) * * *
E:\FR\FM\13JNR1.SGM
13JNR1
*
*
34062
Federal Register / Vol. 70, No. 112 / Monday, June 13, 2005 / Rules and Regulations
(3) Transferring unlicensed gifts or
charitable donations from the
Government of Syria to a U.S. person;
PART 538—SUDANESE SANCTIONS
REGULATIONS
United States, that is a money
transmitter, as defined in 31 CFR
103.11(uu)(5), that is registered
pursuant to 31 CFR 103.41.
Subpart D—Interpretations
3. The authority citation for part 538
continues to read as follows:
I
Authority: 3 U.S.C. 301; 31 U.S.C. 321(b);
18 U.S.C. 2339B, 2332d; 50 U.S.C. 1601–
1651, 1701–1706; Pub. L. 106–387, 114 Stat.
1549; E.O. 13067, 62 FR 59989, 3 CFR, 1997
Comp., p. 230.
Subpart C—General Definitions
4. Section 538.317 is added to subpart
C as follows:
I
§ 538.317
U.S. depository institution.
The term U.S. depository institution
means any entity (including its foreign
branches) organized under the laws of
the United States or of any jurisdiction
within the United States, or any agency,
office or branch located in the United
States of a foreign entity, that is engaged
primarily in the business of banking (for
example, banks, savings banks, savings
associations, credit unions, trust
companies and United States bank
holding companies) and is subject to
regulation by federal or state banking
authorities.
I 5. Section 538.318 is added to subpart
C as follows:
§ 538.318 U.S. registered broker or dealer
in securities.
The term U.S. registered broker or
dealer in securities means any U.S.
citizen, permanent resident alien, or
entity organized under the laws of the
United States or of any jurisdiction
within the United States, including its
foreign branches, or any agency, office
or branch of a foreign entity located in
the United States, that:
(a) Is a ‘‘broker’’ or ‘‘dealer’’ in
securities within the meanings set forth
in the Securities Exchange Act of 1934;
(b) Holds or clears customer accounts;
and
(c) Is registered with the Securities
and Exchange Commission under the
Securities Exchange Act of 1934.
I 3. Section 538.319 is added to subpart
C as follows:
§ 538.412
7. Section 538.412 is removed from
subpart D.
[Removed]
8. Section 538.413 is removed from
subpart D.
I
Subpart E—Licenses, Authorizations,
and Statements of Licensing Policy
9. Section 538.507 is revised to read as
follows:
I
§ 538.507
Reexports by non-U.S. persons.
(a) Goods and technology subject to
export license application requirements
under other United States regulations.
The reexportation to Sudan or the
Government of Sudan by a non-U.S.
person of any goods or technology
exported from the United States, the
exportation of which to Sudan is subject
to export or reexport license application
requirements, is authorized under this
section provided that the goods or
technology:
(1) Have been incorporated into
another product outside the United
States and constitute 10 percent or less
by value of that product exported from
a third country; or
(2) Have been substantially
transformed outside the United States.
Note to paragraph (a) of § 538.507:
Notwithstanding the authorization set forth
in paragraph (a), a non-U.S. person’s
reexportation of goods, technology or
software of U.S. origin that are subject to the
Export Administration Regulations (15 CFR
parts 730 through 774) may require specific
authorization from the Department of
Commerce, Bureau of Industry and Security.
§ 538.319 U.S. registered money
transmitter.
The term U.S. registered money
transmitter means any U.S. citizen,
permanent resident alien, or entity
organized under the laws of the United
States or of any jurisdiction within the
United States, including its foreign
branches, or any agency, office or
branch of a foreign entity located in the
(b) Goods and technology not subject
to export license application
requirements under other United States
regulations. The reexportation to Sudan
or the Government of Sudan by a nonU.S. person of any goods or technology
of U.S. origin, the exportation of which
to Sudan is not subject to any export
license application requirements under
any other United States regulations, is
authorized under this section.
Note to paragraph (b) of § 538.507:
However, the reexportation by non-U.S.
persons of U.S.-origin goods, technology or
software classified as EAR99 under the
Export Administration Regulations (15 CFR
parts 730 through 774) may require specific
authorization from the Department of
Commerce, Bureau of Industry and Security.
VerDate jul<14>2003
15:44 Jun 10, 2005
Jkt 205001
PO 00000
Frm 00008
Fmt 4700
Sfmt 4700
10. Section 538.527 is added to subpart
E to read as follows:
I
§ 538.527
[Removed]
I
§ 538.413
See, for example, the end-use and end-user
restrictions set forth in 15 CFR part 744.
Operation of accounts.
The operation of an account in a U.S.
financial institution for an individual
ordinarily resident in Sudan who is not
included within the term ‘‘Government
of Sudan,’’ as defined in § 538.305, is
authorized, provided that transactions
processed through the account:
(a) Are of a personal nature and not
for use in supporting or operating a
business;
(b) Do not involve transfers directly or
indirectly to Sudan or for the benefit of
individuals ordinarily resident in Sudan
unless authorized by § 538.528; and
(c) Are not otherwise prohibited by
this part.
11. Section 538.528 is added to subpart
E to read as follows:
I
§ 538.528 Noncommercial, personal
remittances.
(a) U.S. depository institutions, U.S.
registered brokers or dealers in
securities, and U.S. registered money
transmitters are authorized to process
transfers of funds to or from Sudan or
for or on behalf of an individual
ordinarily resident in Sudan who is not
included within the term ‘‘Government
of Sudan,’’ as defined in § 538.305, in
cases in which the transfer involves a
noncommercial, personal remittance,
provided the transfer is not by, to, or
through a person who is included
within the term ‘‘Government of
Sudan,’’ as defined in § 538.305.
Noncommercial, personal remittances
do not include charitable donations to
or for the benefit of an entity or funds
transfers for use in supporting or
operating a business.
Note to paragraph (a) of § 538.528: The
institutions identified in paragraph (a) may
transfer charitable donations made by U.S.
persons to nongovernmental organizations in
Sudan registered pursuant to § 538.521,
provided that the transfer is made pursuant
to § 538.521 and the terms of the registration.
(b) The transferring institutions
identified in paragraph (a) of this
section may rely on the originator of a
funds transfer with regard to
compliance with paragraph (a),
provided that the transferring institution
does not know or have reason to know
that the funds transfer is not in
compliance with paragraph (a).
(c) This section does not authorize
transactions with respect to property
blocked pursuant to § 538.201.
E:\FR\FM\13JNR1.SGM
13JNR1
Federal Register / Vol. 70, No. 112 / Monday, June 13, 2005 / Rules and Regulations
Subpart G—Penalties
12. Section 538.701(c) is amended by
revising paragraph (c) as follows:
I
§ 538.701
Penalties.
*
*
*
*
*
(c) Attention is also directed to 18
U.S.C. 1001, which provides that
whoever, in any matter within the
jurisdiction of the executive, legislative,
or judicial branch of the United States,
knowingly and willfully falsifies,
conceals or covers up by any trick,
scheme, or device a material fact, or
makes any materially false, fictitious or
fraudulent statement or representation
or makes or uses any false writing or
document knowing the same to contain
any materially false, fictitious or
fraudulent statement or entry, shall be
fined under title 18, United States Code,
or imprisoned not more than five years,
or both.
I 13. Section 538.702 is revised to read
as follows:
§ 538.702
Prepenalty notice.
(a) When required. If the Director of
the Office of Foreign Assets Control has
reason to believe that there has occurred
a violation of any provision of this part
or a violation of the provisions of any
license, ruling, regulation, order,
direction or instruction issued by or
pursuant to the direction or
authorization of the Secretary of the
Treasury pursuant to this part or
otherwise under the International
Emergency Economic Powers Act, and
the Director determines that further
proceedings are warranted, the Director
shall notify the alleged violator of the
agency’s intent to impose a monetary
penalty by issuing a prepenalty notice.
The prepenalty notice shall be in
writing. The prepenalty notice may be
issued whether or not another agency
has taken any action with respect to the
matter.
(b) Contents of notice.—(1) Facts of
violation. The prepenalty notice shall
describe the violation, specify the laws
and regulations allegedly violated, and
state the amount of the proposed
monetary penalty.
(2) Right to respond. The prepenalty
notice also shall inform the respondent
of the respondent’s right to make a
written presentation within the
applicable 30-day period set forth in
§ 538.703 as to why a monetary penalty
should not be imposed or why, if
imposed, the monetary penalty should
be in a lesser amount than proposed.
(c) Informal settlement prior to
issuance of prepenalty notice. At any
time prior to the issuance of a
prepenalty notice, an alleged violator
VerDate jul<14>2003
15:44 Jun 10, 2005
Jkt 205001
may request in writing that, for a period
not to exceed sixty (60) days, the agency
withhold issuance of the prepenalty
notice for the exclusive purpose of
effecting settlement of the agency’s
potential civil monetary penalty claims.
In the event the Director grants the
request, under terms and conditions
within the Director’s discretion, the
Office of Foreign Assets Control will
agree to withhold issuance of the
prepenalty notice for a period not to
exceed 60 days and will enter into
settlement negotiations with respect to
the potential civil monetary penalty
claim.
I 14. Section 538.703 is revised to read
as follows:
§ 538.703 Response to prepenalty notice;
informal settlement.
(a) Deadline for response. The
respondent may submit a response to
the prepenalty notice within the
applicable 30-day period set forth in
this paragraph. The Director may grant,
at the Director’s discretion, an extension
of time in which to submit a response
to the prepenalty notice. The failure to
submit a response within the applicable
time period set forth in this paragraph
shall be deemed to be a waiver of the
right to respond.
(1) Computation of time for response.
A response to the prepenalty notice
must be postmarked or date-stamped by
the U.S. Postal Service (or foreign postal
service, if mailed abroad) or courier
service provider (if transmitted to OFAC
by courier) on or before the 30th day
after the postmark date on the envelope
in which the prepenalty notice was
mailed. If the respondent refused
delivery or otherwise avoided receipt of
the prepenalty notice, a response must
be postmarked or date-stamped on or
before the 30th day after the date on the
stamped postal receipt maintained at
the Office of Foreign Assets Control. If
the prepenalty notice was personally
delivered to the respondent by a nonU.S. Postal Service agent authorized by
the Director, a response must be
postmarked or date-stamped on or
before the 30th day after the date of
delivery.
(2) Extensions of time for response. If
a due date falls on a federal holiday or
weekend, that due date is extended to
include the following business day. Any
other extensions of time will be granted,
at the Director’s discretion, only upon
the respondent’s specific request to the
Office of Foreign Assets Control.
(b) Form and method of response. The
response must be submitted in
typewritten form and signed by the
respondent or a representative thereof.
The response need not be in any
PO 00000
Frm 00009
Fmt 4700
Sfmt 4700
34063
particular form. A copy of the written
response may be sent by facsimile, but
the original also must be sent to the
Office of Foreign Assets Control Civil
Penalties Division by mail or courier
and must be postmarked or datestamped, in accordance with paragraph
(a) of this section.
(c) Contents of response. A written
response must contain information
sufficient to indicate that it is in
response to the prepenalty notice and
must identify the Office of Foreign
Assets Control identification number
listed on the prepenalty notice.
(1) A written response must include
the respondent’s full name, address,
telephone number, and facsimile
number, if available, or those of the
representative of the respondent.
(2) A written response should either
admit or deny each specific violation
alleged in the prepenalty notice and also
state if the respondent has no
knowledge of a particular violation. If
the written response fails to address any
specific violation alleged in the
prepenalty notice, that alleged violation
shall be deemed to be admitted.
(3) A written response should include
any information in defense, evidence in
support of an asserted defense, or other
factors that the respondent requests the
Office of Foreign Assets Control to
consider. Any defense or explanation
previously made to the Office of Foreign
Assets Control or any other agency must
be repeated in the written response. Any
defense not raised in the written
response will be considered waived.
The written response also should set
forth the reasons why the respondent
believes the penalty should not be
imposed or why, if imposed, it should
be in a lesser amount than proposed.
(d) Failure to respond. Where OFAC
receives no response to a prepenalty
notice within the applicable time period
set forth in paragraph (a) of this section,
a penalty notice generally will be
issued, taking into account the
mitigating and/or aggravating factors
present in the record. If there are no
mitigating factors present in the record,
or the record contains a preponderance
of aggravating factors, the proposed
prepenalty amount generally will be
assessed as the final penalty.
(e) Informal settlement. In addition to
or as an alternative to a written response
to a prepenalty notice, the respondent or
respondent’s representative may contact
the Office of Foreign Assets Control’s
Civil Penalties Division as advised in
the prepenalty notice to propose the
settlement of allegations contained in
the prepenalty notice and related
matters. However, the requirements set
forth in paragraph (g) of this section as
E:\FR\FM\13JNR1.SGM
13JNR1
34064
Federal Register / Vol. 70, No. 112 / Monday, June 13, 2005 / Rules and Regulations
to oral communication by the
representative must first be fulfilled. In
the event of settlement at the prepenalty
stage, the claim proposed in the
prepenalty notice will be withdrawn,
the respondent will not be required to
take a written position on allegations
contained in the prepenalty notice, and
the Office of Foreign Assets Control will
make no final determination as to
whether a violation occurred. The
amount accepted in settlement of
allegations in a prepenalty notice may
vary from the civil penalty that might
finally be imposed in the event of a
formal determination of violation. In the
event no settlement is reached, the time
limit specified in paragraph (a) of this
section for written response to the
prepenalty notice will remain in effect,
unless additional time is granted by the
Office of Foreign Assets Control.
(f) Guidelines. Guidelines for the
imposition or settlement of civil
penalties by the Office of Foreign Assets
Control have been codified in the
Appendix to 31 CFR part 501, the
Reporting, Procedures and Penalties
Regulations.
(g) Representation. A representative of
the respondent may act on behalf of the
respondent, but any oral
communication with the Office of
Foreign Assets Control prior to a written
submission regarding the specific
allegations contained in the prepenalty
notice must be preceded by a written
letter of representation, unless the
prepenalty notice was served upon the
respondent in care of the representative.
I 15. Section 538.704 is revised to read
as follows:
§ 538.704 Penalty imposition or
withdrawal.
(a) No violation. If, after considering
any response to the prepenalty notice
and any relevant facts, the Director of
the Office of Foreign Assets Control
determines that there was no violation
by the respondent named in the
prepenalty notice, the Director shall
notify the respondent in writing of that
determination and of the cancellation of
the proposed monetary penalty.
(b) Violation.—(1) If, after considering
any written response to the prepenalty
notice, or default in the submission of
a written response, and any relevant
facts, the Director of the Office of
Foreign Assets Control determines that
there was a violation by the respondent
named in the prepenalty notice, the
Director is authorized to issue a written
penalty notice to the respondent of the
determination of the violation and the
imposition of the monetary penalty.
(2) The penalty notice shall inform
the respondent that payment or
VerDate jul<14>2003
15:44 Jun 10, 2005
Jkt 205001
arrangement for installment payment of
the assessed penalty must be made
within 30 days of the date of mailing of
the penalty notice by the Office of
Foreign Assets Control.
(3) The penalty notice shall inform
the respondent of the requirement to
furnish the respondent’s taxpayer
identification number pursuant to 31
U.S.C. 7701 and that such number will
be used for purposes of collecting and
reporting on any delinquent penalty
amount.
(4) The issuance of the penalty notice
finding a violation and imposing a
monetary penalty shall constitute final
agency action. The respondent has the
right to seek judicial review of that
agency action in federal district court.
Dated: April 26, 2005.
Robert W. Werner,
Director, Office of Foreign Assets Control.
Approved: May 9, 2005.
Juan C. Zarate,
Assistant Secretary (Terrorist Financing and
Financial Crimes), Department of the
Treasury.
[FR Doc. 05–11637 Filed 6–8–05; 3:22 pm]
BILLING CODE 4810–25–P
DEPARTMENT OF HOMELAND
SECURITY
Coast Guard
33 CFR Part 165
[CGD09–05–014]
RIN 2115–AA87
Security Zone; Duluth Harbor, Duluth,
MN
Coast Guard, DHS.
Temporary final rule.
AGENCY:
ACTION:
SUMMARY: The Coast Guard is
establishing a temporary security zone
in Duluth’s inner harbor for the
Commissioning ceremony of the Coast
Guard Cutter ALDER. The security zone
is necessary to ensure the security of
dignitaries attending this ceremony on
June 10, 2005. The security zone is
intended to restrict vessels from a
portion of Duluth Harbor in Duluth,
Minnesota.
DATES: This rule is effective from 10
a.m. (local) until 3 p.m., June 10, 2005.
ADDRESSES: Comments and material
received from the public, as well as
documents indicated in this preamble as
being available in the docket, are part of
docket (CGD09–05–014) and are
available for inspection or copying at
the U.S. Coast Guard Marine Safety
Office Duluth, 600 South Lake Avenue,
PO 00000
Frm 00010
Fmt 4700
Sfmt 4700
Canal Park, Duluth, Minnesota 55802,
between the hours of 7:30 a.m. and 3:30
p.m., Monday through Friday, except
Federal holidays.
FOR FURTHER INFORMATION CONTACT: LT
Greg Schultz, U.S. Coast Guard Marine
Safety Office Duluth, at (218) 720–5285.
SUPPLEMENTARY INFORMATION:
Regulatory Information
On May 13, 2005, we published a
notice of proposed rulemaking in the
Federal Register (70 FR 25514). We
received no comments on the proposed
rule. No public hearing was requested,
and none was held. Under 5 U.S.C. 553
(d)(3), the Coast Guard finds that good
cause exists for making this rule
effective less than 30 days after
publication in the Federal Register. The
regulation is needed to protect
dignitaries during the event and a delay
would be contrary to the public interest.
Background and Purpose
The security zone will encompass the
waters of Duluth Harbor, within a 500
foot radius from a fixed point located at
46°46′17″ N, 92°05′26″ W. These
coordinates are based upon North
American Datum (NAD 1983).
Entry into, transit through, or
anchoring within this security zone is
prohibited unless authorized by the
Captain of the Port Duluth or his
designated on-scene representative. The
designated on-scene representative will
be the Coast Guard Patrol Commander.
The Coast Guard Patrol Commander
may be contacted via VHF Channel 16.
Regulatory Evaluation
This rule is not a ‘‘significant
regulatory action’’ under section 3(f) of
Executive Order 12866, Regulatory
Planning and Review, and does not
require an assessment of potential costs
and benefits under section 6(a)(3) of that
Order. The Office of Management and
Budget has not reviewed it under that
Order. It is not ‘‘significant’’ under the
regulatory policies and procedures of
the Department of Homeland Security
(DHS).
The security zone will only be in
effect for a few hours on the day of the
event and vessels may easily still transit
inside the Duluth Harbor.
Small Entities
Under the Regulatory Flexibility Act
(5 U.S.C. 601–612), we have considered
whether this rule would have a
significant economic impact on a
substantial number of small entities.
The term ‘‘small entities’’ comprises
small businesses, not-for-profit
organizations that are independently
owned and operated and are not
E:\FR\FM\13JNR1.SGM
13JNR1
]]>Agencies
[Federal Register Volume 70, Number 112 (Monday, June 13, 2005)]
[Rules and Regulations]
[Pages 34060-34064]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-11637]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Office of Foreign Assets Control
31 CFR Parts 501 and 538
Reporting, Procedures and Penalties Regulations and Sudanese
Sanctions Regulations
AGENCY: Office of Foreign Assets Control, Treasury.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Office of Foreign Assets Control (``OFAC'') of the U.S.
Department of the Treasury is revising the Reporting, Procedures and
Penalties Regulations (the ``RPPR'') to make a technical change in
order to remove a reference to the Government of Sudan that was used
prior to the promulgation of Executive Order 13067 and the Sudanese
Sanctions Regulations.
OFAC is also amending the Sudanese Sanctions Regulations, (the
``SSR''). The amendments to the SSR include the issuance of two general
licenses, effective June 13, 2005. One general license authorizes the
operation of accounts in U.S. financial institutions under certain
circumstances for individuals ordinarily resident in Sudan. The other
general license authorizes U.S. depository institutions, U.S.
registered brokers and dealers in securities, and U.S. registered money
transmitters to process transfers of funds constituting noncommercial,
personal remittances to or from Sudan or for or on behalf of
individuals ordinarily resident in Sudan. Other amendments to the SSR
include the removal of two regulatory provisions and the revision of a
provision regarding reexportation of U.S.-origin goods, technology or
software by non-U.S. persons, and another revision of to reflect
changes in OFAC's procedure for imposing civil penalties.
DATES: Effective Date: June 13, 2005.
FOR FURTHER INFORMATION CONTACT: Chief of Compliance Programs, tel.:
202/622-2490, Chief of Civil Penalties, tel.: 202/622-6140, Chief of
Licensing, tel.: 202/622-2480, Chief of Policy Planning and Program
Management, tel.: 202/622-4855, or Chief Counsel, tel.: 202/622-2410,
Office of Foreign Assets Control, Department of the Treasury,
Washington, DC 20220.
SUPPLEMENTARY INFORMATION:
Electronic and Facsimile Availability
This file is available for download without charge in ASCII and
Adobe Acrobat readable (*.PDF) formats at GPO Access. GPO Access
supports HTTP, FTP, and Telnet at fedbbs.access.gpo.gov. It may also be
accessed by modem dialup at 202/512-1387 followed by typing ``/GO/
FAC.'' Paper copies of this document can be obtained by calling the
Government Printing Office at 202-512-1530. Additional information
concerning the programs of the Office of Foreign Assets Control is
available for download from the Office's Internet Home Page at: https://
www.treas.gov/ofac or via FTP at ofacftp.treas.gov. Facsimiles of
information are available through the Office's 24-hour fax-on-demand
service: call 202/622-0077 using a fax machine, a fax modem, or (within
the United States) a touch-tone telephone.
Background
On November 3, 1997, President Clinton, invoking the authority,
inter alia, of the International Emergency Economic Powers Act (50
U.S.C. 1701-1706), issued Executive Order 13067 (62 FR 59989, November
5, 1997). The order declared a national emergency with respect to the
policies and actions of the Government of Sudan, ``including continued
support for international terrorism; ongoing efforts to destabilize
neighboring governments; and the prevalence of human rights violations,
including slavery and the denial of religious freedom.'' To deal with
this national emergency, Executive Order 13067 imposed trade sanctions
with respect to Sudan and blocked all property and interests in
property of the Government of Sudan in the United States or within the
possession or control of U.S. persons. The Sudanese Sanctions
Regulations, 31 CFR part 538 (the ``SSR''), implement Executive Order
13067.
[[Page 34061]]
The Reporting, Procedures and Penalties Regulations, 31 CFR part
501 (the ``RPPR''), set forth uniform reporting and procedural
requirements applicable to all OFAC sanctions programs. OFAC is
amending the RPPR to make a technical change to Sec. 501.604 by
removing a reference to the Government of Sudan from that section.
Section 501.604(b) uses the Government of Sudan in an example of
transactions involving funds transfers that are rejected, but not
blocked. This example, however, was published before the issuance of
Executive Order 13067 and OFAC's promulgation of the SSR. Executive
Order 13067 and the SSR require U.S. financial institutions to block
unlicensed funds transfers involving the Government of Sudan.
OFAC is also amending provisions of the SSR dealing with the
transfer of funds to Sudan. First, the SSR are being amended by the
removal of Sec. 538.413, an interpretive provision stating that the
transfer of funds to Sudan from the United States does not constitute
an exportation of services pursuant to Sec. 538.205. As a result of
the removal of Sec. 538.413, money transmittal services to Sudan are
prohibited except as otherwise authorized.
Second, to authorize a means by which noncommercial, personal
transmittals of money to Sudan may take place in a manner consistent
with Executive Order 13067, OFAC is amending the SSR by issuing a
general license, effective June 13, 2005. This general license, new
Sec. 538.528, authorizes U.S. depository institutions, U.S. registered
brokers and dealers in securities, and U.S. registered money
transmitters to process transfers of funds constituting noncommercial,
personal remittances under certain circumstances to or from Sudan or
for or on behalf of individuals ordinarily resident in Sudan. The
general license does not authorize transfers if the underlying
transaction is otherwise prohibited by subpart B of the SSR.
Definitions of ``U.S. depository institution,'' ``U.S. registered
broker or dealer in securities,'' and ``U.S. registered money
transmitter'' are added to subpart C of the SSR to clarify the scope of
the general license.
Third, Sec. 538.412, an interpretive provision stating that the
operation of accounts in financial institutions for private Sudanese
persons does not constitute the exportation of a service to Sudan, is
removed from subpart D of the SSR. The content of this section appears
in revised form in subpart E as a new general license, Sec. 538.527,
effective June 13, 2005. Section 538.527 authorizes the operation of
accounts in U.S. financial institutions for individuals ordinarily
resident in Sudan, provided that transactions through the accounts are
of a personal nature. The section does not authorize account
transactions for use in supporting or operating a business; nor does it
authorize transfers of funds to Sudan or to or for the benefit of
individuals ordinarily resident in Sudan unless authorized by Sec.
538.528. The section also does not authorize transactions that are
otherwise prohibited by subpart B of the SSR.
In addition to the changes described above, Sec. 538.507 of the
SSR is also revised to clarify the circumstances under which the
reexportation of goods, technology or software of U.S. origin to Sudan
or the Government of Sudan by a non-U.S. person is authorized.
Finally, Sec. Sec. 538.701-.704 of the SSR are amended to reflect
changes in OFAC's procedure for imposing or settling civil penalties.
Sections 538.701-.704 set forth the procedure by which civil penalties
will be issued or settled, as well as guidelines for responding to a
prepenalty notice. The amendments do not affect the maximum penalty
amounts that the SSR authorize.
Public Participation
Because the Regulations involve a foreign affairs function, the
provisions of Executive Order 12866 and the Administrative Procedure
Act (5 U.S.C. 553) (the ``APA'') requiring notice of proposed
rulemaking, opportunity for public participation, and delay in
effective date are inapplicable. Because no notice of proposed
rulemaking is required for this rule, the Regulatory Flexibility Act (5
U.S.C. 601-612) does not apply. However, OFAC encourages interested
persons who wish to comment to do so in writing by any of the following
methods:
Agency Web site: https://www.treas.gov/offices/enforcement/
ofac/comment.html.
Fax: Chief of Records, 202/622-1657.
Mail: Chief of Records, Attn: Request for Comments, Office
of Foreign Assets Control, Department of the Treasury, 1500
Pennsylvania Avenue, NW., Washington, DC 20220.
OFAC will not accept public comments in languages other than
English or accompanied by a request that a part or all of the
submission be treated confidentially because of its business
proprietary nature or for any other reason. OFAC will return any such
submission to the originator. All public comments on these Regulations
will be a matter of public record. Copies of the public record
concerning these Regulations will be made available not sooner than
September 12, 2005 and will be obtainable from OFAC's Web site (https://
www.treas.gov/ofac). If that service is unavailable, written requests
for copies may be sent to: Office of Foreign Assets Control, U.S.
Department of the Treasury, 1500 Pennsylvania Ave., NW., Washington, DC
20220, Attn: Chief, Records Division.
Paperwork Reduction Act
The collections of information related to 31 CFR part 501 and 31
CFR part 538 are contained in 31 CFR part 501 (the ``Reporting,
Procedures and Penalties Regulations''). Pursuant to the Paperwork
Reduction Act of 1995 (44 U.S.C. 3507), those collections of
information have been approved by the Office of Management and Budget
under control number 1505-0164. An agency may not conduct or sponsor,
and a person is not required to respond to, a collection of information
unless the collection of information displays a valid control number.
List of Subjects
31 CFR Part 501
Administrative practice and procedure, Banks, Banking, Blocking of
assets, Information, Investments, Loans, Penalties, Reporting and
recordkeeping requirements, Services, Specially designated nationals,
Sudan, Terrorism.
31 CFR Part 538
Administrative practice and procedure, Agricultural commodities,
Banks, Banking, Blocking of assets, Drugs, Exports, Foods, Foreign
trade, Humanitarian aid, Imports, Information, Investments, Loans,
Medical devices, Medicine, Penalties, Reporting and recordkeeping
requirements, Services, Specially designated nationals, Sudan,
Terrorism, Transportation.
0
For the reasons set forth in the Preamble, 31 CFR parts 501 and 538 are
amended as follows:
PART 501--REPORTING, PROCEDURES AND PENALTIES REGULATIONS
0
1. The authority citation for part 501 continues to read as follows:
Authority: 21 U.S.C. 1901-1908; 22 U.S.C. 287c; 31 U.S.C.
321(b); 50 U.S.C. 1701-1706; 50 U.S.C. App. 1-44.
0
2. Section 501.604 is amended by revising paragraph (b) (3) to read as
follows:
Sec. 501.604 Reports by U.S. financial institutions on rejected funds
transfers.
* * * * *
(b) * * *
[[Page 34062]]
(3) Transferring unlicensed gifts or charitable donations from the
Government of Syria to a U.S. person;
PART 538--SUDANESE SANCTIONS REGULATIONS
0
3. The authority citation for part 538 continues to read as follows:
Authority: 3 U.S.C. 301; 31 U.S.C. 321(b); 18 U.S.C. 2339B,
2332d; 50 U.S.C. 1601-1651, 1701-1706; Pub. L. 106-387, 114 Stat.
1549; E.O. 13067, 62 FR 59989, 3 CFR, 1997 Comp., p. 230.
Subpart C--General Definitions
0
4. Section 538.317 is added to subpart C as follows:
Sec. 538.317 U.S. depository institution.
The term U.S. depository institution means any entity (including
its foreign branches) organized under the laws of the United States or
of any jurisdiction within the United States, or any agency, office or
branch located in the United States of a foreign entity, that is
engaged primarily in the business of banking (for example, banks,
savings banks, savings associations, credit unions, trust companies and
United States bank holding companies) and is subject to regulation by
federal or state banking authorities.
0
5. Section 538.318 is added to subpart C as follows:
Sec. 538.318 U.S. registered broker or dealer in securities.
The term U.S. registered broker or dealer in securities means any
U.S. citizen, permanent resident alien, or entity organized under the
laws of the United States or of any jurisdiction within the United
States, including its foreign branches, or any agency, office or branch
of a foreign entity located in the United States, that:
(a) Is a ``broker'' or ``dealer'' in securities within the meanings
set forth in the Securities Exchange Act of 1934;
(b) Holds or clears customer accounts; and
(c) Is registered with the Securities and Exchange Commission under
the Securities Exchange Act of 1934.
0
3. Section 538.319 is added to subpart C as follows:
Sec. 538.319 U.S. registered money transmitter.
The term U.S. registered money transmitter means any U.S. citizen,
permanent resident alien, or entity organized under the laws of the
United States or of any jurisdiction within the United States,
including its foreign branches, or any agency, office or branch of a
foreign entity located in the United States, that is a money
transmitter, as defined in 31 CFR 103.11(uu)(5), that is registered
pursuant to 31 CFR 103.41.
Subpart D--Interpretations
Sec. 538.412 [Removed]
0
7. Section 538.412 is removed from subpart D.
Sec. 538.413 [Removed]
0
8. Section 538.413 is removed from subpart D.
Subpart E--Licenses, Authorizations, and Statements of Licensing
Policy
0
9. Section 538.507 is revised to read as follows:
Sec. 538.507 Reexports by non-U.S. persons.
(a) Goods and technology subject to export license application
requirements under other United States regulations. The reexportation
to Sudan or the Government of Sudan by a non-U.S. person of any goods
or technology exported from the United States, the exportation of which
to Sudan is subject to export or reexport license application
requirements, is authorized under this section provided that the goods
or technology:
(1) Have been incorporated into another product outside the United
States and constitute 10 percent or less by value of that product
exported from a third country; or
(2) Have been substantially transformed outside the United States.
Note to paragraph (a) of Sec. 538.507: Notwithstanding the
authorization set forth in paragraph (a), a non-U.S. person's
reexportation of goods, technology or software of U.S. origin that
are subject to the Export Administration Regulations (15 CFR parts
730 through 774) may require specific authorization from the
Department of Commerce, Bureau of Industry and Security.
(b) Goods and technology not subject to export license application
requirements under other United States regulations. The reexportation
to Sudan or the Government of Sudan by a non-U.S. person of any goods
or technology of U.S. origin, the exportation of which to Sudan is not
subject to any export license application requirements under any other
United States regulations, is authorized under this section.
Note to paragraph (b) of Sec. 538.507: However, the
reexportation by non-U.S. persons of U.S.-origin goods, technology
or software classified as EAR99 under the Export Administration
Regulations (15 CFR parts 730 through 774) may require specific
authorization from the Department of Commerce, Bureau of Industry
and Security. See, for example, the end-use and end-user
restrictions set forth in 15 CFR part 744.
0
10. Section 538.527 is added to subpart E to read as follows:
Sec. 538.527 Operation of accounts.
The operation of an account in a U.S. financial institution for an
individual ordinarily resident in Sudan who is not included within the
term ``Government of Sudan,'' as defined in Sec. 538.305, is
authorized, provided that transactions processed through the account:
(a) Are of a personal nature and not for use in supporting or
operating a business;
(b) Do not involve transfers directly or indirectly to Sudan or for
the benefit of individuals ordinarily resident in Sudan unless
authorized by Sec. 538.528; and
(c) Are not otherwise prohibited by this part.
0
11. Section 538.528 is added to subpart E to read as follows:
Sec. 538.528 Noncommercial, personal remittances.
(a) U.S. depository institutions, U.S. registered brokers or
dealers in securities, and U.S. registered money transmitters are
authorized to process transfers of funds to or from Sudan or for or on
behalf of an individual ordinarily resident in Sudan who is not
included within the term ``Government of Sudan,'' as defined in Sec.
538.305, in cases in which the transfer involves a noncommercial,
personal remittance, provided the transfer is not by, to, or through a
person who is included within the term ``Government of Sudan,'' as
defined in Sec. 538.305. Noncommercial, personal remittances do not
include charitable donations to or for the benefit of an entity or
funds transfers for use in supporting or operating a business.
Note to paragraph (a) of Sec. 538.528: The institutions
identified in paragraph (a) may transfer charitable donations made
by U.S. persons to nongovernmental organizations in Sudan registered
pursuant to Sec. 538.521, provided that the transfer is made
pursuant to Sec. 538.521 and the terms of the registration.
(b) The transferring institutions identified in paragraph (a) of
this section may rely on the originator of a funds transfer with regard
to compliance with paragraph (a), provided that the transferring
institution does not know or have reason to know that the funds
transfer is not in compliance with paragraph (a).
(c) This section does not authorize transactions with respect to
property blocked pursuant to Sec. 538.201.
[[Page 34063]]
Subpart G--Penalties
0
12. Section 538.701(c) is amended by revising paragraph (c) as follows:
Sec. 538.701 Penalties.
* * * * *
(c) Attention is also directed to 18 U.S.C. 1001, which provides
that whoever, in any matter within the jurisdiction of the executive,
legislative, or judicial branch of the United States, knowingly and
willfully falsifies, conceals or covers up by any trick, scheme, or
device a material fact, or makes any materially false, fictitious or
fraudulent statement or representation or makes or uses any false
writing or document knowing the same to contain any materially false,
fictitious or fraudulent statement or entry, shall be fined under title
18, United States Code, or imprisoned not more than five years, or
both.
0
13. Section 538.702 is revised to read as follows:
Sec. 538.702 Prepenalty notice.
(a) When required. If the Director of the Office of Foreign Assets
Control has reason to believe that there has occurred a violation of
any provision of this part or a violation of the provisions of any
license, ruling, regulation, order, direction or instruction issued by
or pursuant to the direction or authorization of the Secretary of the
Treasury pursuant to this part or otherwise under the International
Emergency Economic Powers Act, and the Director determines that further
proceedings are warranted, the Director shall notify the alleged
violator of the agency's intent to impose a monetary penalty by issuing
a prepenalty notice. The prepenalty notice shall be in writing. The
prepenalty notice may be issued whether or not another agency has taken
any action with respect to the matter.
(b) Contents of notice.--(1) Facts of violation. The prepenalty
notice shall describe the violation, specify the laws and regulations
allegedly violated, and state the amount of the proposed monetary
penalty.
(2) Right to respond. The prepenalty notice also shall inform the
respondent of the respondent's right to make a written presentation
within the applicable 30-day period set forth in Sec. 538.703 as to
why a monetary penalty should not be imposed or why, if imposed, the
monetary penalty should be in a lesser amount than proposed.
(c) Informal settlement prior to issuance of prepenalty notice. At
any time prior to the issuance of a prepenalty notice, an alleged
violator may request in writing that, for a period not to exceed sixty
(60) days, the agency withhold issuance of the prepenalty notice for
the exclusive purpose of effecting settlement of the agency's potential
civil monetary penalty claims. In the event the Director grants the
request, under terms and conditions within the Director's discretion,
the Office of Foreign Assets Control will agree to withhold issuance of
the prepenalty notice for a period not to exceed 60 days and will enter
into settlement negotiations with respect to the potential civil
monetary penalty claim.
0
14. Section 538.703 is revised to read as follows:
Sec. 538.703 Response to prepenalty notice; informal settlement.
(a) Deadline for response. The respondent may submit a response to
the prepenalty notice within the applicable 30-day period set forth in
this paragraph. The Director may grant, at the Director's discretion,
an extension of time in which to submit a response to the prepenalty
notice. The failure to submit a response within the applicable time
period set forth in this paragraph shall be deemed to be a waiver of
the right to respond.
(1) Computation of time for response. A response to the prepenalty
notice must be postmarked or date-stamped by the U.S. Postal Service
(or foreign postal service, if mailed abroad) or courier service
provider (if transmitted to OFAC by courier) on or before the 30th day
after the postmark date on the envelope in which the prepenalty notice
was mailed. If the respondent refused delivery or otherwise avoided
receipt of the prepenalty notice, a response must be postmarked or
date-stamped on or before the 30th day after the date on the stamped
postal receipt maintained at the Office of Foreign Assets Control. If
the prepenalty notice was personally delivered to the respondent by a
non-U.S. Postal Service agent authorized by the Director, a response
must be postmarked or date-stamped on or before the 30th day after the
date of delivery.
(2) Extensions of time for response. If a due date falls on a
federal holiday or weekend, that due date is extended to include the
following business day. Any other extensions of time will be granted,
at the Director's discretion, only upon the respondent's specific
request to the Office of Foreign Assets Control.
(b) Form and method of response. The response must be submitted in
typewritten form and signed by the respondent or a representative
thereof. The response need not be in any particular form. A copy of the
written response may be sent by facsimile, but the original also must
be sent to the Office of Foreign Assets Control Civil Penalties
Division by mail or courier and must be postmarked or date-stamped, in
accordance with paragraph (a) of this section.
(c) Contents of response. A written response must contain
information sufficient to indicate that it is in response to the
prepenalty notice and must identify the Office of Foreign Assets
Control identification number listed on the prepenalty notice.
(1) A written response must include the respondent's full name,
address, telephone number, and facsimile number, if available, or those
of the representative of the respondent.
(2) A written response should either admit or deny each specific
violation alleged in the prepenalty notice and also state if the
respondent has no knowledge of a particular violation. If the written
response fails to address any specific violation alleged in the
prepenalty notice, that alleged violation shall be deemed to be
admitted.
(3) A written response should include any information in defense,
evidence in support of an asserted defense, or other factors that the
respondent requests the Office of Foreign Assets Control to consider.
Any defense or explanation previously made to the Office of Foreign
Assets Control or any other agency must be repeated in the written
response. Any defense not raised in the written response will be
considered waived. The written response also should set forth the
reasons why the respondent believes the penalty should not be imposed
or why, if imposed, it should be in a lesser amount than proposed.
(d) Failure to respond. Where OFAC receives no response to a
prepenalty notice within the applicable time period set forth in
paragraph (a) of this section, a penalty notice generally will be
issued, taking into account the mitigating and/or aggravating factors
present in the record. If there are no mitigating factors present in
the record, or the record contains a preponderance of aggravating
factors, the proposed prepenalty amount generally will be assessed as
the final penalty.
(e) Informal settlement. In addition to or as an alternative to a
written response to a prepenalty notice, the respondent or respondent's
representative may contact the Office of Foreign Assets Control's Civil
Penalties Division as advised in the prepenalty notice to propose the
settlement of allegations contained in the prepenalty notice and
related matters. However, the requirements set forth in paragraph (g)
of this section as
[[Page 34064]]
to oral communication by the representative must first be fulfilled. In
the event of settlement at the prepenalty stage, the claim proposed in
the prepenalty notice will be withdrawn, the respondent will not be
required to take a written position on allegations contained in the
prepenalty notice, and the Office of Foreign Assets Control will make
no final determination as to whether a violation occurred. The amount
accepted in settlement of allegations in a prepenalty notice may vary
from the civil penalty that might finally be imposed in the event of a
formal determination of violation. In the event no settlement is
reached, the time limit specified in paragraph (a) of this section for
written response to the prepenalty notice will remain in effect, unless
additional time is granted by the Office of Foreign Assets Control.
(f) Guidelines. Guidelines for the imposition or settlement of
civil penalties by the Office of Foreign Assets Control have been
codified in the Appendix to 31 CFR part 501, the Reporting, Procedures
and Penalties Regulations.
(g) Representation. A representative of the respondent may act on
behalf of the respondent, but any oral communication with the Office of
Foreign Assets Control prior to a written submission regarding the
specific allegations contained in the prepenalty notice must be
preceded by a written letter of representation, unless the prepenalty
notice was served upon the respondent in care of the representative.
0
15. Section 538.704 is revised to read as follows:
Sec. 538.704 Penalty imposition or withdrawal.
(a) No violation. If, after considering any response to the
prepenalty notice and any relevant facts, the Director of the Office of
Foreign Assets Control determines that there was no violation by the
respondent named in the prepenalty notice, the Director shall notify
the respondent in writing of that determination and of the cancellation
of the proposed monetary penalty.
(b) Violation.--(1) If, after considering any written response to
the prepenalty notice, or default in the submission of a written
response, and any relevant facts, the Director of the Office of Foreign
Assets Control determines that there was a violation by the respondent
named in the prepenalty notice, the Director is authorized to issue a
written penalty notice to the respondent of the determination of the
violation and the imposition of the monetary penalty.
(2) The penalty notice shall inform the respondent that payment or
arrangement for installment payment of the assessed penalty must be
made within 30 days of the date of mailing of the penalty notice by the
Office of Foreign Assets Control.
(3) The penalty notice shall inform the respondent of the
requirement to furnish the respondent's taxpayer identification number
pursuant to 31 U.S.C. 7701 and that such number will be used for
purposes of collecting and reporting on any delinquent penalty amount.
(4) The issuance of the penalty notice finding a violation and
imposing a monetary penalty shall constitute final agency action. The
respondent has the right to seek judicial review of that agency action
in federal district court.
Dated: April 26, 2005.
Robert W. Werner,
Director, Office of Foreign Assets Control.
Approved: May 9, 2005.
Juan C. Zarate,
Assistant Secretary (Terrorist Financing and Financial Crimes),
Department of the Treasury.
[FR Doc. 05-11637 Filed 6-8-05; 3:22 pm]
BILLING CODE 4810-25-P
