Supplemental Standards for Ethical Conduct for Employees of the Department of the Treasury, 60707-60710 [2011-25105]
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Federal Register / Vol. 76, No. 190 / Friday, September 30, 2011 / Rules and Regulations
nonprecedential Orders, explain that
parties may cite nonprecedential
Orders, and also explain that the Board
is not bound by nonprecedential Orders
in its future decisions.
The Board believes that issuing and
publishing nonprecedential Orders that
include a substantive review of issues
presented in an appeal will serve the
useful purpose of informing parties of
the Board’s reasoning in a particular
appeal. In addition, the new regulation
should ensure the maximum degree of
transparency in the Board’s decisionmaking to the greatest extent possible.
List of Subjects in 5 CFR Part 1201
Administrative practice and
procedure, Government employees.
Accordingly, the Board amends 5 CFR
part 1201 as follows:
particular appeal. Nonprecedential
Orders are not binding on the Board or
its administrative judges in any future
appeals except when it is determined
they have a preclusive effect on parties
under the doctrines of res judicata
(claim preclusion), collateral estoppel
(issue preclusion), judicial estoppel, or
law of the case. Parties may cite
nonprecedential Orders, but such orders
have no precedential value; the Board
and its administrative judges are not
required to follow or distinguish them
in any future decisions. In contrast, a
precedential decision issued as an
Opinion and Order has been identified
by the Board as significantly
contributing to the Board’s case law.
William D. Spencer,
Clerk of the Board.
[FR Doc. 2011–25174 Filed 9–29–11; 8:45 am]
PART 1201—[AMENDED]
BILLING CODE 7400–01–P
1. The authority citation for part 1201
continues to read as follows:
DEPARTMENT OF THE TREASURY
Authority: 5 U.S.C. 1204, 1305, and 7701,
and 38 U.S.C. 4331, unless otherwise noted.
Office of Financial Research
2. Revise § 1201.117 to read as
follows:
12 CFR Chapter XVI
■
■
RIN 1505–AC38
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§ 1201.117 Board decisions; procedures
for review or reopening.
(a) In any case that is reopened or
reviewed, the Board may:
(1) Issue a single decision that denies
or grants a petition for review, reopens
an appeal, and decides the case;
(2) Hear oral arguments;
(3) Require that briefs be filed;
(4) Remand the appeal so that the
judge may take further testimony or
evidence or make further findings or
conclusions; or
(5) Take any other action necessary
for final disposition of the case.
(b) The Board may affirm, reverse,
modify, or vacate the initial decision of
the judge, in whole or in part. The
Board may issue a final decision and,
when appropriate, order a date for
compliance with that decision.
(c) The Board may issue a decision in
the form of a precedential Opinion and
Order or a nonprecedential Order.
(1) Opinion and Order. An Opinion
and Order is a precedential decision of
the Board and may be appropriately
cited or referred to by any party.
(2) Nonprecedential Orders. A
nonprecedential Order is one that the
Board has determined does not add
significantly to the body of MSPB case
law. The Board may, in its discretion,
include in nonprecedential Orders a
discussion of the issue(s) to assist the
parties in understanding the reason(s)
for the Board’s disposition in a
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Supplemental Standards for Ethical
Conduct for Employees of the
Department of the Treasury
Office of Financial Research,
Treasury.
ACTION: Interim rule.
AGENCY:
The Department of the
Treasury (Department), with the
concurrence of the Director of the Office
of Government Ethics (OGE), is
establishing a new chapter in Title 12 of
the Code of Federal Regulations to
incorporate certain post-employment
prohibitions that apply to employees of
the Office of Financial Research (OFR).
The Dodd-Frank Wall Street Reform and
Consumer Protection Act (Dodd-Frank)
provides for certain post-employment
prohibitions if OFR employees have had
access to transaction or position data or
other business confidential information
about financial entities required to
report to OFR.
DATES: Effective date: September 30,
2011. Comment due date: November 29,
2011.
ADDRESSES: Interested persons are
invited to submit comments on all
aspects of the interim rule through one
of these methods:
Electronic Submission of Comments.
Interested persons may submit
comments electronically through the
Federal eRulemaking Portal at https://
www.regulations.gov. Electronic
SUMMARY:
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60707
submission of comments allows the
commenter maximum time to prepare
and submit a comment, ensures timely
receipt, and enables the Department to
make them available to the public.
Comments submitted electronically
through the https://www.regulations.gov
Web site can be viewed by other
commenters and interested members of
the public.
Mail: Department of the Treasury,
Office of Financial Research, Attention:
Post-Employment Interim Rule, Room
1334, 1500 Pennsylvania Avenue, NW.,
Washington, DC 20220.
Fax and e-mail comments will not be
accepted.
Instructions: In general, the
Department will enter all comments
received into the docket and make them
available, without change, including
any business or personal information
that you provide such as name and
address information, e-mail addresses,
or phone numbers. Comments,
including attachments and other
supporting materials, received are part
of the public record and subject to
public disclosure. Do not enclose any
information in your comment or
supporting materials that you consider
confidential or inappropriate for public
disclosure. Properly submitted
comments will be available for
inspection and downloading at https://
www.regulations.gov.
You may personally inspect
comments at the Department of the
Treasury Library, Room 1428, Main
Treasury Building, 1500 Pennsylvania
Avenue, NW., Washington, DC. You can
make an appointment to inspect
comments by calling (202) 622–0990.
FOR FURTHER INFORMATION CONTACT:
Elizabeth A. Horton, Deputy Assistant
General Counsel (Ethics) at (202) 622–
0450 or Ethics@treasury.gov.
SUPPLEMENTARY INFORMATION: DoddFrank (Pub. L. 111–203), sets forth rules
that apply to employees of the OFR.
This interim rule establishes 12 CFR
chapter XVI, consisting of part 1600,
which generally prohibits the Director
of the OFR and any employee of the
OFR who has had access to the
transaction or position data maintained
by OFR’s Data Center or other business
confidential information about financial
entities required to report to the OFR
from being employed by or providing
advice or consulting services to a
financial company, for a period of one
year after last having had access in the
course of official duties to such
transaction or position data or business
confidential information, regardless of
whether that entity is required to report
to the OFR.
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Federal Register / Vol. 76, No. 190 / Friday, September 30, 2011 / Rules and Regulations
The OFR was established by section
152 of Dodd-Frank (Public Law 111–
203). Section 152(g) of Dodd-Frank
provides that:
The Secretary [of the Treasury], with the
concurrence of the Director of the Office of
Government Ethics, shall issue regulations
prohibiting the [OFR] Director and any
employee of the Office [OFR] who has had
access to the transaction or position data
maintained by the Data Center or other
business confidential information about
financial entities required to report to the
Office [OFR] from being employed by or
providing advice or consulting services to a
financial company, for a period of 1 year after
last having had access in the course of
official duties to such transaction or position
data or business confidential information,
regardless of whether that entity is required
to report to the Office [OFR]. For employees
whose access to business confidential
information was limited, the regulations may
provide, on a case-by-case basis, for a shorter
period of post-employment prohibition,
provided that the shorter period does not
compromise business confidential
information.
As authorized in section 152(g) of DoddFrank, the regulations include an
exception to the general postemployment prohibitions that apply to
employees of the OFR. Under certain
circumstances and on a case-by-case
basis, employees whose access to
business confidential information was
limited may request a waiver from the
post-employment prohibitions.
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Standards of Ethical Conduct for
Employees of the Office of Financial
Research
The Department is adding this
regulation to explain the circumstances
under which an OFR employee, who
has had access to the transaction or
position data maintained by OFR’s Data
Center or other business confidential
information about financial entities
required to report to the OFR, is
prohibited from being employed by or
providing advice or consulting services
to a financial company, regardless of
whether the financial company is
required to report to the OFR, for a
period of one year after last having had
access in the course of official duties to
transaction or position data or business
confidential information maintained by
the Data Center.
The new rule permits all OFR
employees whose access to business
confidential information was limited to
seek a waiver from the Designated
Agency Ethics Official.
Administrative Procedure Act
Under 5 U.S.C. 553(a)(2), rules
relating to agency management or
personnel are exempt from the proposed
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rulemaking requirements of the
Administrative Procedure Act (APA). As
set forth in the description of the
interim rule, this rule affects only the
OFR and its personnel. Nonetheless, the
Department is issuing this interim rule
for comment and welcomes comments
from the public on all aspects of the
rule. Even if this rulemaking were
subject to APA proposed rulemaking
procedures, the Department finds good
cause, pursuant to 5 U.S.C. 553(b) and
(d), to waive the requirements for notice
and comment and 30-day delayed
effective date because the rule affects
only the OFR and its employees. It is in
the public interest that this rule, which
concerns matters of agency
management, personnel, organization,
practice and procedure, and in part
relieves certain restrictions placed on
OFR employees, become effective on the
date of publication.
Regulatory Flexibility Act Analysis
Because no notice of proposed
rulemaking is required, the provisions
of the Regulatory Flexibility Act (5
U.S.C. 601 et seq.) do not apply.
Executive Order 12866
This interim rule is not a ‘‘significant
regulatory action’’ for the purposes of
Executive Order 12866.
Unfunded Mandates Reform Act
Section 202 of the Unfunded
Mandates Reform Act of 1995
(Unfunded Mandates Act) requires an
agency to prepare a budgetary impact
statement before promulgating a rule
that includes a Federal mandate that
may result in expenditure by State,
local, and Tribal governments, in the
aggregate, or by the private sector, of
$100 million or more in any one year.
If a budgetary impact statement is
required, section 205 of the Unfunded
Mandates Act also requires an agency to
identify and consider a reasonable
number of regulatory alternatives before
promulgating a rule. This rule addresses
restrictions on OFR employees
regarding certain post-employment
activities. The Department therefore has
determined that the rule will not result
in expenditures by State, local or Tribal
governments or by the private sector of
$100 million or more. Accordingly, the
Department has not prepared a
budgetary impact statement or
specifically addressed the regulatory
alternatives considered.
Lists of Subjects in 12 CFR Part 1600
Post employment, Ethics, employees.
For the reasons set forth in the
preamble, the Department, with the
concurrence of OGE, establishes 12 CFR
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chapter XVI, consisting of part 1600, to
read as follows:
CHAPTER XVI—OFFICE OF FINANCIAL
RESEARCH
PART 1600—ORGANIZATION AND
FUNCTIONS OF THE OFFICE OF
FINANCIAL RESEARCH
Sec.
1600.1
Standards of ethical conduct.
Authority: 5 U.S.C. 301, 7301, 31 U.S.C.
321, the Dodd-Frank Wall Street Reform and
Consumer Protection Act (Dodd-Frank) (Pub.
L. 111–203); E.O. 12674, 3 CFR, 1989 Comp.,
p. 215, as modified by E.O. 12731, 3 CFR,
1990 Comp., p. 306.
§ 1600.1
Standards of ethical conduct.
This section applies to the employees
of the Office of Financial Research and
is in addition to 5 CFR 3101.101–104,
and 31 CFR part 0:
(a) Definitions—For purposes of this
subpart:
(1) ‘‘Business confidential
information’’ shall include trade secret
or other formula, practice, process,
design, instrument, pattern, or
compilation of information which is not
generally known or reasonably
ascertainable, by which a business can
obtain an economic advantage over
competitors or customers. This shall
include non-public position and
transaction data, as well as data
provided to supervisors or regulators
that is unpublished.
(2) ‘‘Position data’’ is defined as:
(i) Data on financial assets or
liabilities held on the balance sheet of
a financial company, where positions
are created or changed by the execution
of a financial transaction; and
(ii) Includes information that
identifies counterparties, the valuation
by the financial company of the
position, and information that makes
possible an independent valuation of
the position.
(3) ‘‘Transaction data’’ is defined as
the structure and legal description of a
financial contract, with sufficient detail
to describe the rights and obligations
between counterparties and make
possible an independent valuation.
(4) ‘‘Micro-level data’’ is defined as
information specific to an individual
transaction or position.
(5) ‘‘Masked data’’ is defined as data
that has been altered to prevent
attribution to a particular financial
company.
(6) ‘‘Financial company’’ has the same
meaning given to such term in title II of
the Dodd-Frank Wall Street Reform and
Consumer Protection Act, 12 U.S.C.
5301 et seq. (2010), and includes an
insured depository institution and an
insurance company.
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Federal Register / Vol. 76, No. 190 / Friday, September 30, 2011 / Rules and Regulations
(b) One-year post-employment
restriction. (1) A current or former
employee of the Office of Financial
Research who has had access to the
transaction or position data or business
confidential information maintained by
the Data Center about financial entities
required to report to the Office may not,
within one year after last having had
access in the course of official duties to
such transaction or position data or
business confidential information, be
employed by or provide advice or
consulting services to a financial
company, regardless of whether that
financial company is required to report
to the Office.
(2) A current or former employee of
the Office of Financial Research who
has had limited access to the transaction
or position data or business confidential
information maintained by the Data
Center about financial entities required
to report to the Office may request a
written waiver pursuant to paragraph (c)
of this section from the Designated
Agency Ethics Official to be employed
by or provide advice or consulting
services to a financial company,
provided that the issuance of the waiver
would not compromise any data or
business confidential information.
(c) Waivers—The post-employment
restrictions set forth in section 152(g) of
the Dodd-Frank Wall Street Reform and
Consumer Protection Act may be
waived in whole or in part for an
employee with limited access to the
transaction or position data or business
confidential information maintained by
the Data Center if—
(1) The Designated Agency Ethics
Official, in consultation with the
Director of the Office of Financial
Research or the Department’s General
Counsel in instances where consultation
with the Director poses a conflict or the
Director’s position is vacant, determines
in writing that such waiver is unlikely
to compromise any financial company’s
business confidential information,
unfairly advantage or disadvantage any
financial company, or affect the
integrity or effectiveness of the Office of
Financial Research.
(2) Relevant factors to be considered
by the Designated Agency Ethics
Official and the Director or General
Counsel include—
(i) The nature and importance of the
employee’s position and the degree to
which the employee had access to nonpublic or business confidential data for
the purpose of analysis, standardization,
or performing applied research or
essential long-term research;
(ii) Whether the information to which
the employee had access revealed
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positions or transactions of an
individual financial company;
(iii) Whether the data, especially
position data, remains sensitive
considering changing circumstances or
the passage of time;
(iv) Whether the employee had access
to micro-level data, as compared to
aggregated information;
(v) If the employee had access to
micro-level data, whether it was
sufficiently masked or coded to protect
the identity of the provider or the
subject financial company;
(vi) Whether the information to which
the employee had access would provide
a financial company employer with a
competitive commercial advantage;
(vii) Whether the financial company
employer has made a satisfactory
representation that it has adopted
screening measures which will
effectively prevent a potential employee
from sharing any transaction or position
data or business confidential
information acquired at the Office of
Financial Research one year prior to
accepting employment with the
company;
(viii) Whether granting the waiver
would affect the willingness of a
financial company to continue to
provide transaction or position data or
business confidential information to the
Office; and
(ix) Whether the proposed
employment would create an
appearance of impropriety or would
otherwise adversely affect the interests
of the government or compromise the
integrity of the office.
(d) The following examples are
illustrative of how the OFR postemployment prohibitions would apply
under certain circumstances:
(1) Example 1. (i) Fact pattern: OFR
employs a business data manager and
such employee has no access to the
transaction or position data maintained
by the Data Center or other business
confidential information about financial
entities required to report to OFR.
(ii) Designated Agency Ethics
Official’s Determination: Upon
termination of their employment by
OFR, such employee would not be
prohibited from being employed by or
providing advice or consulting services
to a financial company, regardless of
whether that financial company is
required to report to the Office.
(2) Example 2. (i) Fact pattern: OFR
employs a data analyst and such
employee has access to transaction or
position data across all sectors
maintained by the Data Center or other
business confidential information about
specific financial entities required to
report to OFR.
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60709
(ii) Designated Agency Ethics
Official’s Determination: Upon
termination of their employment by
OFR, such employee would be
prohibited, for a period of one year
immediately after leaving OFR, from
being employed by or providing advice
or consulting services to a financial
company, regardless of whether that
financial company is required to report
to the Office.
(3) Example 3. (i) Fact pattern: OFR
employs a data analyst and such
employee has access to transaction or
position data across all sectors
maintained by the Data Center or other
business confidential information about
specific financial entities required to
report to OFR. Employee last had access
to such data six months before
termination of her employment at OFR.
(ii) Designated Agency Ethics
Official’s Determination: Upon
termination of employment by OFR,
such employee would be prohibited, for
a period of six months immediately after
leaving OFR, from being employed by or
providing advice or consulting services
to a financial company, regardless of
whether that financial company is
required to report to the Office.
(4) Example 4. (i) Fact pattern: OFR
employs a researcher and such
employee has access only to
‘‘aggregated’’ or ‘‘masked’’ transaction or
position data maintained by the Data
Center or other business confidential
information about financial entities
required to report to OFR.
(ii) Designated Agency Ethics
Official’s Determination: Upon
termination of their employment by
OFR, such employee would not be
prohibited from being employed by or
providing advice or consulting services
to a financial company, regardless of
whether that financial company is
required to report to the Office.
(5) Example 5. (i) Fact pattern: OFR
employs a data analyst and such
employee has access to transaction or
position data maintained by the Data
Center or other business confidential
information relating to a particular
sector (i.e. banking).
(ii) Designated Agency Ethics
Official’s Determination: Upon
termination of employment by OFR,
such employee would be prohibited, for
a period of one year immediately after
leaving OFR, from being employed by or
providing advice or consulting services
to a financial company in that particular
sector (i.e. banking) where such
employment or services involves
employment or advice or consulting
services, regardless of whether that
financial company is required to report
to the Office. Such employee would be
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Federal Register / Vol. 76, No. 190 / Friday, September 30, 2011 / Rules and Regulations
granted a waiver to work in other
designated sectors immediately after
leaving OFR.
(6) Example 6. (i) Fact pattern: OFR
employs a data analyst and such
employee has access to business
confidential information in an area
where data, such as equity mutual fund
holdings, changes frequently. Employee
last had access to such data six months
before termination of her employment at
OFR and, because of portfolio turnover,
there is no risk of compromising
business confidential information.
(ii) Designated Agency Ethics
Official’s Determination: Upon
termination of their employment by
OFR, such employee would not be
prohibited from being employed by or
providing advice or consulting services
to a financial company, regardless of
whether that financial company is
required to report to the Office.
(7) Example 7. (i) Fact pattern: OFR
employs an information technology
specialist and such employee has access
only to ‘‘masked’’ transaction or
position data maintained by the Data
Center or other ‘‘masked’’ business
confidential information about specific
financial entities required to report to
OFR.
(ii) Designated Agency Ethics
Official’s Determination: Upon
termination of their employment by
OFR, such employee would not be
prohibited from being employed by or
providing advice or consulting services
to a financial company, regardless of
whether that financial company is
required to report to the Office.
Dated: September 19, 2011.
George W. Madison,
General Counsel, Department of the Treasury.
[FR Doc. 2011–25105 Filed 9–29–11; 8:45 am]
BILLING CODE 4810–25–P
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration
14 CFR Part 39
[Docket No. FAA–2010–1199; Directorate
Identifier 2010–NM–225–AD; Amendment
39–16818; AD 2011–20–07]
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RIN 2120–AA64
Airworthiness Directives; The Boeing
Company Model 737–600, –700, –700C,
–800, and –900 Series Airplanes
Federal Aviation
Administration (FAA), DOT.
ACTION: Final rule.
AGENCY:
We are superseding an
existing airworthiness directive (AD) for
SUMMARY:
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the products listed above. That AD
currently requires replacement of the
power control relays in the P91 and P92
power distribution panels for the fuel
boost and override pumps with new,
improved relays having a ground fault
interrupter (GFI) feature, or installation
and maintenance of universal fault
interrupters (UFIs) using a certain
supplemental type certificate. This new
AD continues to require the actions of
the existing AD and also specifies which
relays may be replaced by GFIs or UFIs.
This AD was prompted by a need to
clarify which relays may be replaced by
installation of UFIs. We are issuing this
AD to prevent pump housing burnthrough due to electrical arcing, which
could create a potential ignition source
inside a fuel tank. This condition, in
combination with flammable fuel
vapors, could result in a fuel tank
explosion and consequent loss of the
airplane.
DATES: This AD is effective November 4,
2011.
The Director of the Federal Register
approved the incorporation by reference
of a certain publication listed in this AD
as of September 22, 2010 (75 FR 50859,
August 18, 2010).
ADDRESSES: For Boeing service
information identified in this AD,
contact Boeing Commercial Airplanes,
Attention: Data & Services Management,
P.O. Box 3707, MC 2H–65, Seattle,
Washington 98124–2207; telephone
206–544–5000, extension 1; fax 206–
766–5680; e-mail
me.boecom@boeing.com; Internet
https://www.myboeingfleet.com. For
TDG Aerospace information identified
in this AD, contact TDG Aerospace, Inc.,
545 Corporate Drive, Escondido,
California 92029; telephone 760–466–
1040; fax 760–466–1038; Internet https://
www.tdgaerospace.com; e-mail
info@tdgaerospace.com. You may
review copies of the referenced service
information at the FAA, Transport
Airplane Directorate, 1601 Lind
Avenue, SW., Renton, Washington. For
information on the availability of this
material at the FAA, call 425–227–1221.
Examining the AD Docket
You may examine the AD docket on
the Internet at https://
www.regulations.gov; or in person at the
Docket Management Facility between
9 a.m. and 5 p.m., Monday through
Friday, except Federal holidays. The AD
docket contains this AD, the regulatory
evaluation, any comments received, and
other information. The address for the
Docket Office (phone: 800–647–5527) is
Document Management Facility, U.S.
Department of Transportation, Docket
PO 00000
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Operations, M–30, West Building
Ground Floor, Room W12–140, 1200
New Jersey Avenue, SE., Washington,
DC 20590.
FOR FURTHER INFORMATION CONTACT:
Georgios Roussos, Aerospace Engineer,
Systems and Equipment Branch, ANM–
130S, FAA, Seattle Aircraft Certification
Office, 1601 Lind Avenue, SW., Renton,
Washington 98057–3356; phone: 425–
917–6482; fax: 425–917–6590; e-mail:
georgios.roussos@faa.gov.
SUPPLEMENTARY INFORMATION:
Discussion
We issued a notice of proposed
rulemaking (NPRM) to amend 14 CFR
part 39 to supersede airworthiness
directive (AD) 2010–17–05, Amendment
39–16395 (75 FR 50859, August 18,
2010). That AD applies to the specified
products. The NPRM published in the
Federal Register on December 20, 2010
(75 FR 79317). That NPRM proposed to
continue to require replacement of the
power control relays in the P91 and P92
power distribution panels for the fuel
boost and override pumps with new,
improved relays having a ground fault
interrupter (GFI) feature, or installation
and maintenance of universal fault
interrupters (UFIs) using a certain
supplemental type certificate. That
NPRM also proposed to specify which
relays may be replaced by GFIs or UFIs.
Actions Since NPRM Was Issued
We have been informed that referring
to TDG Aerospace UFIs, as provided in
paragraph (g)(2)(ii) of the NPRM (75 FR
79317, December 20, 2010), violates
Office of the Federal Register (OFR)
regulations (1 CFR part 51) for approval
of optional materials ‘‘incorporated by
reference’’ in rules. We have revised
paragraph (g)(2)(ii) of this AD to specify
that installation of TDG Aerospace UFIs,
as provided in that paragraph, must be
done in accordance with a method
approved by the Manager, Seattle
Aircraft Certification Office (ACO),
FAA. We have also added Note 2 to this
AD to specify that additional guidance
on installing TDG Aerospace UFIs can
be found in TDG Aerospace
Supplemental Type Certificate (STC)
ST02076LA.
Comments
We gave the public the opportunity to
participate in developing this AD. The
following presents the comments
received on the proposal and the FAA’s
response to each comment.
Request To Allow Credit for
Accomplishment of STC
Continental Airlines (CAL) requested
that paragraph (h) of the proposed AD
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]]>Agencies
[Federal Register Volume 76, Number 190 (Friday, September 30, 2011)]
[Rules and Regulations]
[Pages 60707-60710]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-25105]
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DEPARTMENT OF THE TREASURY
Office of Financial Research
12 CFR Chapter XVI
RIN 1505-AC38
Supplemental Standards for Ethical Conduct for Employees of the
Department of the Treasury
AGENCY: Office of Financial Research, Treasury.
ACTION: Interim rule.
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SUMMARY: The Department of the Treasury (Department), with the
concurrence of the Director of the Office of Government Ethics (OGE),
is establishing a new chapter in Title 12 of the Code of Federal
Regulations to incorporate certain post-employment prohibitions that
apply to employees of the Office of Financial Research (OFR). The Dodd-
Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank)
provides for certain post-employment prohibitions if OFR employees have
had access to transaction or position data or other business
confidential information about financial entities required to report to
OFR.
DATES: Effective date: September 30, 2011. Comment due date: November
29, 2011.
ADDRESSES: Interested persons are invited to submit comments on all
aspects of the interim rule through one of these methods:
Electronic Submission of Comments. Interested persons may submit
comments electronically through the Federal eRulemaking Portal at
https://www.regulations.gov. Electronic submission of comments allows
the commenter maximum time to prepare and submit a comment, ensures
timely receipt, and enables the Department to make them available to
the public. Comments submitted electronically through the https://www.regulations.gov Web site can be viewed by other commenters and
interested members of the public.
Mail: Department of the Treasury, Office of Financial Research,
Attention: Post-Employment Interim Rule, Room 1334, 1500 Pennsylvania
Avenue, NW., Washington, DC 20220.
Fax and e-mail comments will not be accepted.
Instructions: In general, the Department will enter all comments
received into the docket and make them available, without change,
including any business or personal information that you provide such as
name and address information, e-mail addresses, or phone numbers.
Comments, including attachments and other supporting materials,
received are part of the public record and subject to public
disclosure. Do not enclose any information in your comment or
supporting materials that you consider confidential or inappropriate
for public disclosure. Properly submitted comments will be available
for inspection and downloading at https://www.regulations.gov.
You may personally inspect comments at the Department of the
Treasury Library, Room 1428, Main Treasury Building, 1500 Pennsylvania
Avenue, NW., Washington, DC. You can make an appointment to inspect
comments by calling (202) 622-0990.
FOR FURTHER INFORMATION CONTACT: Elizabeth A. Horton, Deputy Assistant
General Counsel (Ethics) at (202) 622-0450 or Ethics@treasury.gov.
SUPPLEMENTARY INFORMATION: Dodd-Frank (Pub. L. 111-203), sets forth
rules that apply to employees of the OFR. This interim rule establishes
12 CFR chapter XVI, consisting of part 1600, which generally prohibits
the Director of the OFR and any employee of the OFR who has had access
to the transaction or position data maintained by OFR's Data Center or
other business confidential information about financial entities
required to report to the OFR from being employed by or providing
advice or consulting services to a financial company, for a period of
one year after last having had access in the course of official duties
to such transaction or position data or business confidential
information, regardless of whether that entity is required to report to
the OFR.
[[Page 60708]]
The OFR was established by section 152 of Dodd-Frank (Public Law
111-203). Section 152(g) of Dodd-Frank provides that:
The Secretary [of the Treasury], with the concurrence of the
Director of the Office of Government Ethics, shall issue regulations
prohibiting the [OFR] Director and any employee of the Office [OFR]
who has had access to the transaction or position data maintained by
the Data Center or other business confidential information about
financial entities required to report to the Office [OFR] from being
employed by or providing advice or consulting services to a
financial company, for a period of 1 year after last having had
access in the course of official duties to such transaction or
position data or business confidential information, regardless of
whether that entity is required to report to the Office [OFR]. For
employees whose access to business confidential information was
limited, the regulations may provide, on a case-by-case basis, for a
shorter period of post-employment prohibition, provided that the
shorter period does not compromise business confidential
information.
As authorized in section 152(g) of Dodd-Frank, the regulations include
an exception to the general post-employment prohibitions that apply to
employees of the OFR. Under certain circumstances and on a case-by-case
basis, employees whose access to business confidential information was
limited may request a waiver from the post-employment prohibitions.
Standards of Ethical Conduct for Employees of the Office of Financial
Research
The Department is adding this regulation to explain the
circumstances under which an OFR employee, who has had access to the
transaction or position data maintained by OFR's Data Center or other
business confidential information about financial entities required to
report to the OFR, is prohibited from being employed by or providing
advice or consulting services to a financial company, regardless of
whether the financial company is required to report to the OFR, for a
period of one year after last having had access in the course of
official duties to transaction or position data or business
confidential information maintained by the Data Center.
The new rule permits all OFR employees whose access to business
confidential information was limited to seek a waiver from the
Designated Agency Ethics Official.
Administrative Procedure Act
Under 5 U.S.C. 553(a)(2), rules relating to agency management or
personnel are exempt from the proposed rulemaking requirements of the
Administrative Procedure Act (APA). As set forth in the description of
the interim rule, this rule affects only the OFR and its personnel.
Nonetheless, the Department is issuing this interim rule for comment
and welcomes comments from the public on all aspects of the rule. Even
if this rulemaking were subject to APA proposed rulemaking procedures,
the Department finds good cause, pursuant to 5 U.S.C. 553(b) and (d),
to waive the requirements for notice and comment and 30-day delayed
effective date because the rule affects only the OFR and its employees.
It is in the public interest that this rule, which concerns matters of
agency management, personnel, organization, practice and procedure, and
in part relieves certain restrictions placed on OFR employees, become
effective on the date of publication.
Regulatory Flexibility Act Analysis
Because no notice of proposed rulemaking is required, the
provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) do
not apply.
Executive Order 12866
This interim rule is not a ``significant regulatory action'' for
the purposes of Executive Order 12866.
Unfunded Mandates Reform Act
Section 202 of the Unfunded Mandates Reform Act of 1995 (Unfunded
Mandates Act) requires an agency to prepare a budgetary impact
statement before promulgating a rule that includes a Federal mandate
that may result in expenditure by State, local, and Tribal governments,
in the aggregate, or by the private sector, of $100 million or more in
any one year. If a budgetary impact statement is required, section 205
of the Unfunded Mandates Act also requires an agency to identify and
consider a reasonable number of regulatory alternatives before
promulgating a rule. This rule addresses restrictions on OFR employees
regarding certain post-employment activities. The Department therefore
has determined that the rule will not result in expenditures by State,
local or Tribal governments or by the private sector of $100 million or
more. Accordingly, the Department has not prepared a budgetary impact
statement or specifically addressed the regulatory alternatives
considered.
Lists of Subjects in 12 CFR Part 1600
Post employment, Ethics, employees.
For the reasons set forth in the preamble, the Department, with the
concurrence of OGE, establishes 12 CFR chapter XVI, consisting of part
1600, to read as follows:
CHAPTER XVI--OFFICE OF FINANCIAL RESEARCH
PART 1600--ORGANIZATION AND FUNCTIONS OF THE OFFICE OF FINANCIAL
RESEARCH
Sec.
1600.1 Standards of ethical conduct.
Authority: 5 U.S.C. 301, 7301, 31 U.S.C. 321, the Dodd-Frank
Wall Street Reform and Consumer Protection Act (Dodd-Frank) (Pub. L.
111-203); E.O. 12674, 3 CFR, 1989 Comp., p. 215, as modified by E.O.
12731, 3 CFR, 1990 Comp., p. 306.
Sec. 1600.1 Standards of ethical conduct.
This section applies to the employees of the Office of Financial
Research and is in addition to 5 CFR 3101.101-104, and 31 CFR part 0:
(a) Definitions--For purposes of this subpart:
(1) ``Business confidential information'' shall include trade
secret or other formula, practice, process, design, instrument,
pattern, or compilation of information which is not generally known or
reasonably ascertainable, by which a business can obtain an economic
advantage over competitors or customers. This shall include non-public
position and transaction data, as well as data provided to supervisors
or regulators that is unpublished.
(2) ``Position data'' is defined as:
(i) Data on financial assets or liabilities held on the balance
sheet of a financial company, where positions are created or changed by
the execution of a financial transaction; and
(ii) Includes information that identifies counterparties, the
valuation by the financial company of the position, and information
that makes possible an independent valuation of the position.
(3) ``Transaction data'' is defined as the structure and legal
description of a financial contract, with sufficient detail to describe
the rights and obligations between counterparties and make possible an
independent valuation.
(4) ``Micro-level data'' is defined as information specific to an
individual transaction or position.
(5) ``Masked data'' is defined as data that has been altered to
prevent attribution to a particular financial company.
(6) ``Financial company'' has the same meaning given to such term
in title II of the Dodd-Frank Wall Street Reform and Consumer
Protection Act, 12 U.S.C. 5301 et seq. (2010), and includes an insured
depository institution and an insurance company.
[[Page 60709]]
(b) One-year post-employment restriction. (1) A current or former
employee of the Office of Financial Research who has had access to the
transaction or position data or business confidential information
maintained by the Data Center about financial entities required to
report to the Office may not, within one year after last having had
access in the course of official duties to such transaction or position
data or business confidential information, be employed by or provide
advice or consulting services to a financial company, regardless of
whether that financial company is required to report to the Office.
(2) A current or former employee of the Office of Financial
Research who has had limited access to the transaction or position data
or business confidential information maintained by the Data Center
about financial entities required to report to the Office may request a
written waiver pursuant to paragraph (c) of this section from the
Designated Agency Ethics Official to be employed by or provide advice
or consulting services to a financial company, provided that the
issuance of the waiver would not compromise any data or business
confidential information.
(c) Waivers--The post-employment restrictions set forth in section
152(g) of the Dodd-Frank Wall Street Reform and Consumer Protection Act
may be waived in whole or in part for an employee with limited access
to the transaction or position data or business confidential
information maintained by the Data Center if--
(1) The Designated Agency Ethics Official, in consultation with the
Director of the Office of Financial Research or the Department's
General Counsel in instances where consultation with the Director poses
a conflict or the Director's position is vacant, determines in writing
that such waiver is unlikely to compromise any financial company's
business confidential information, unfairly advantage or disadvantage
any financial company, or affect the integrity or effectiveness of the
Office of Financial Research.
(2) Relevant factors to be considered by the Designated Agency
Ethics Official and the Director or General Counsel include--
(i) The nature and importance of the employee's position and the
degree to which the employee had access to non-public or business
confidential data for the purpose of analysis, standardization, or
performing applied research or essential long-term research;
(ii) Whether the information to which the employee had access
revealed positions or transactions of an individual financial company;
(iii) Whether the data, especially position data, remains sensitive
considering changing circumstances or the passage of time;
(iv) Whether the employee had access to micro-level data, as
compared to aggregated information;
(v) If the employee had access to micro-level data, whether it was
sufficiently masked or coded to protect the identity of the provider or
the subject financial company;
(vi) Whether the information to which the employee had access would
provide a financial company employer with a competitive commercial
advantage;
(vii) Whether the financial company employer has made a
satisfactory representation that it has adopted screening measures
which will effectively prevent a potential employee from sharing any
transaction or position data or business confidential information
acquired at the Office of Financial Research one year prior to
accepting employment with the company;
(viii) Whether granting the waiver would affect the willingness of
a financial company to continue to provide transaction or position data
or business confidential information to the Office; and
(ix) Whether the proposed employment would create an appearance of
impropriety or would otherwise adversely affect the interests of the
government or compromise the integrity of the office.
(d) The following examples are illustrative of how the OFR post-
employment prohibitions would apply under certain circumstances:
(1) Example 1. (i) Fact pattern: OFR employs a business data
manager and such employee has no access to the transaction or position
data maintained by the Data Center or other business confidential
information about financial entities required to report to OFR.
(ii) Designated Agency Ethics Official's Determination: Upon
termination of their employment by OFR, such employee would not be
prohibited from being employed by or providing advice or consulting
services to a financial company, regardless of whether that financial
company is required to report to the Office.
(2) Example 2. (i) Fact pattern: OFR employs a data analyst and
such employee has access to transaction or position data across all
sectors maintained by the Data Center or other business confidential
information about specific financial entities required to report to
OFR.
(ii) Designated Agency Ethics Official's Determination: Upon
termination of their employment by OFR, such employee would be
prohibited, for a period of one year immediately after leaving OFR,
from being employed by or providing advice or consulting services to a
financial company, regardless of whether that financial company is
required to report to the Office.
(3) Example 3. (i) Fact pattern: OFR employs a data analyst and
such employee has access to transaction or position data across all
sectors maintained by the Data Center or other business confidential
information about specific financial entities required to report to
OFR. Employee last had access to such data six months before
termination of her employment at OFR.
(ii) Designated Agency Ethics Official's Determination: Upon
termination of employment by OFR, such employee would be prohibited,
for a period of six months immediately after leaving OFR, from being
employed by or providing advice or consulting services to a financial
company, regardless of whether that financial company is required to
report to the Office.
(4) Example 4. (i) Fact pattern: OFR employs a researcher and such
employee has access only to ``aggregated'' or ``masked'' transaction or
position data maintained by the Data Center or other business
confidential information about financial entities required to report to
OFR.
(ii) Designated Agency Ethics Official's Determination: Upon
termination of their employment by OFR, such employee would not be
prohibited from being employed by or providing advice or consulting
services to a financial company, regardless of whether that financial
company is required to report to the Office.
(5) Example 5. (i) Fact pattern: OFR employs a data analyst and
such employee has access to transaction or position data maintained by
the Data Center or other business confidential information relating to
a particular sector (i.e. banking).
(ii) Designated Agency Ethics Official's Determination: Upon
termination of employment by OFR, such employee would be prohibited,
for a period of one year immediately after leaving OFR, from being
employed by or providing advice or consulting services to a financial
company in that particular sector (i.e. banking) where such employment
or services involves employment or advice or consulting services,
regardless of whether that financial company is required to report to
the Office. Such employee would be
[[Page 60710]]
granted a waiver to work in other designated sectors immediately after
leaving OFR.
(6) Example 6. (i) Fact pattern: OFR employs a data analyst and
such employee has access to business confidential information in an
area where data, such as equity mutual fund holdings, changes
frequently. Employee last had access to such data six months before
termination of her employment at OFR and, because of portfolio
turnover, there is no risk of compromising business confidential
information.
(ii) Designated Agency Ethics Official's Determination: Upon
termination of their employment by OFR, such employee would not be
prohibited from being employed by or providing advice or consulting
services to a financial company, regardless of whether that financial
company is required to report to the Office.
(7) Example 7. (i) Fact pattern: OFR employs an information
technology specialist and such employee has access only to ``masked''
transaction or position data maintained by the Data Center or other
``masked'' business confidential information about specific financial
entities required to report to OFR.
(ii) Designated Agency Ethics Official's Determination: Upon
termination of their employment by OFR, such employee would not be
prohibited from being employed by or providing advice or consulting
services to a financial company, regardless of whether that financial
company is required to report to the Office.
Dated: September 19, 2011.
George W. Madison,
General Counsel, Department of the Treasury.
[FR Doc. 2011-25105 Filed 9-29-11; 8:45 am]
BILLING CODE 4810-25-P
