Amendment to the Bank Secrecy Act Regulations-Requirement That Clerks of Court Report Certain Currency Transactions, 33635-33637 [2012-13783]
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Federal Register / Vol. 77, No. 110 / Thursday, June 7, 2012 / Rules and Regulations
wreier-aviles on DSK5TPTVN1PROD with RULES
the Treasury yield curve, less Treasury’s
administrative costs. As Treasury’s costs
of administering the SLGS program have
decreased so has the amount of the
differential that exists between the
SLGS rate and the Treasury borrowing
rate. The differential was last changed
in a 2005 Final Rule (70 FR 37904, June
30, 2005) when Treasury lowered the
SLGS rate from 5 basis points below the
current Treasury borrowing rates to 1
basis point below current Treasury
borrowing rates.
In this rule, Treasury revises the
definition of ‘‘SLGS rate’’ and
‘‘annualized effective Demand Deposit
rate’’ to address the current extremely
low yield environment. The revised
definitions will prevent the calculation
of the rates for SLGS securities from
resulting in negative rates. No change is
being made to Treasury’s administrative
costs. Additionally, to add clarification
to part 344, Treasury revises the
definition of ‘‘Y’’ in the annualized
effective Demand Deposit rate
calculation formula to clarify the
calculation method to be used during a
year that contains a leap day. This
revision should not affect issuers’
practices and systems.
While the formula for calculating the
rate for Demand Deposit SLGS securities
remains unchanged under § 344.7(a), the
definition of ‘‘annualized effective
Demand Deposit rate’’ is being
amended. This has the effect of
preventing the calculation of the rate for
Demand Deposit SLGS securities from
resulting in a negative rate. Demand
Deposit SLGS securities will continue to
bear a rate of interest based on an
adjustment of the average yield for
three-month (13-week) Treasury bills at
the most recent auction. A new rate will
be effective on the first business day
following the regular auction of 13-week
Treasury bills and will continue to be
shown in the SLGS rate table. Lastly,
Treasury’s administrative costs for
administering Demand Deposit SLGS
securities remain unchanged under
§ 344.7(a)(2).
Procedural Requirements
Executive Order 12866. This final rule
is not a significant regulatory action
pursuant to Executive Order 12866,
dated September 30, 1993.
Administrative Procedure Act (APA).
Because this rule relates to United
States securities, which are contracts
between Treasury and the owner of the
security, this rule falls within the
contract exception to the APA, 5 U.S.C.
553(a)(2). As a result, the notice, public
comment, and delayed effective date
provisions of the APA are inapplicable
to this rule.
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Regulatory Flexibility Act. The
provisions of the Regulatory Flexibility
Act, 5 U.S.C. 601 et seq., do not apply
to this rule because, pursuant to 5
U.S.C. 553(a)(2), it is not required to be
issued with notice and opportunity for
public comment.
Paperwork Reduction Act (PRA). We
ask for no collections of information in
this final rule. Therefore, the Paperwork
Reduction Act (44 U.S.C. 3501 et seq.)
does not apply.
Congressional Review Act (CRA). This
rule is not a major rule pursuant to the
CRA, 5 U.S.C. 801 et seq., because it is
a minor amendment that is not expected
to lead to any of the results listed in 5
U.S.C. 804(2). This rule will take effect
upon publication in the Federal
Register, after we submit a copy of it to
Congress and the Comptroller General.
List of Subjects in 31 CFR Part 344
Bonds, Government securities,
Reporting and recordkeeping
requirements.
Accordingly, for the reasons set forth
in the preamble, Treasury amends 31
CFR part 344 as follows:
PART 344—U.S. TREASURY
SECURITIES—STATE AND LOCAL
GOVERNMENT SERIES
1. The authority citation for part 344
continues to read as follows:
■
Authority: 26 U.S.C. 141 note; 31 U.S.C.
3102, 3103, 3104, and 3121.
2. Amend § 344.1 by revising the
definition of ‘‘SLGS rate,’’ to read as
follows:
■
§ 344.1 What special terms do I need to
know to understand this part?
*
*
*
*
*
SLGS rate means the current Treasury
borrowing rate, less one basis point, as
released daily by Treasury in a SLGS
rate table. If the current Treasury
borrowing rate, together with the one
basis point adjustment, results in a
negative rate, such corresponding SLGS
rate will be set at zero.
*
*
*
*
*
■ 3. Amend § 344.7 by:
■ a. Revising paragraph (a) introductory
text; and
■ b. Revising ‘‘I’’ and ‘‘Y’’ in Equation
1 in paragraph (a)(1)(i) to read as
follows:
§ 344.7 What are Demand Deposit
securities?
*
*
*
*
*
(a) How is the rate for Demand
Deposit securities determined? Each
security shall bear a rate of interest
based on an adjustment of the average
yield for 13-week Treasury bills at the
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33635
most recent auction. A new annualized
effective Demand Deposit rate and daily
factor for the Demand Deposit rate are
effective on the first business day
following the regular auction of 13-week
Treasury bills and are shown in the
SLGS rate table. Interest is accrued and
added to the principal daily. Interest is
computed on the balance of the
principal, plus interest accrued through
the preceding day.
(1) * * *
(i) * * *
(Equation 1)
*
*
*
*
*
I = Annualized effective Demand Deposit rate
in decimals. If the rate is determined to
be negative, such rate will be reset to
zero.
*
*
*
*
*
Y = 365 (if the year following issue date of
the 13-week Treasury bill does not
contain a leap year day) or 366 (if the
year following issue date of the 13-week
Treasury bill does contain a leap year
day).
*
*
*
*
*
Richard L. Gregg,
Fiscal Assistant Secretary.
[FR Doc. 2012–13779 Filed 6–6–12; 8:45 am]
BILLING CODE 4810–39–P
DEPARTMENT OF THE TREASURY
Financial Crimes Enforcement Network
31 CFR Part 1010
RIN 1506–AB17
Amendment to the Bank Secrecy Act
Regulations—Requirement That Clerks
of Court Report Certain Currency
Transactions
Financial Crimes Enforcement
Network (‘‘FinCEN’’), Treasury.
ACTION: Final rule.
AGENCY:
FinCEN is amending the rules
relating to the reporting of certain
currency transactions consistent with a
recent statutory amendment authorizing
FinCEN to require clerks of court to file
such reports with the U.S. Department
of the Treasury. Such information
already is required to be reported by
clerks of court pursuant to regulations
issued by the Internal Revenue Service
(‘‘IRS’’), but FinCEN heretofore has been
limited in its ability to access and share
further that information because of
minor differences between the relevant
statutory authorities applicable to
FinCEN and the IRS.
DATES: Effective Date: July 9, 2012.
FOR FURTHER INFORMATION CONTACT: The
FinCEN regulatory helpline at (800)
949–2732 and select Option 6.
SUMMARY:
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Federal Register / Vol. 77, No. 110 / Thursday, June 7, 2012 / Rules and Regulations
SUPPLEMENTARY INFORMATION:
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I. Statutory Provisions
FinCEN exercises regulatory functions
primarily under the Currency and
Financial Transactions Reporting Act of
1970, as amended by the USA PATRIOT
Act of 2001 and other legislation, which
legislative framework is commonly
referred to as the ‘‘Bank Secrecy Act’’
(‘‘BSA’’),1 which authorizes the
Secretary of the Treasury (‘‘Secretary’’)
to require financial institutions to keep
records and file reports that ‘‘have a
high degree of usefulness in criminal,
tax, or regulatory proceedings, or in the
conduct of intelligence or
counterintelligence activities, including
analysis, to protect against international
terrorism.2 The Secretary has delegated
to the Director of FinCEN the authority
to implement, administer, and enforce
compliance with the BSA and
associated regulations.3 FinCEN is
authorized to impose anti-money
laundering (‘‘AML’’) program
requirements on financial institutions.4
Under 31 U.S.C. 5331, any person
who is engaged in a trade or business
and who, in the course of such trade or
business, receives more than $10,000 in
coins or currency in one transaction (or
two or more related transactions) is
required to file a report with respect to
such transaction (or related
transactions) with FinCEN. Reporting
under section 5331 does not apply to
amounts received in a transaction
reported under 31 U.S.C. 5313 and its
implementing regulations.5
For purposes of section 5331,
currency includes foreign currency, and
to the extent provided in regulations,
any monetary instrument, whether or
not in bearer form, with a face amount
of not more than $10,000. Such
monetary instruments shall not include
any check drawn on the account of the
writer in a financial institution referred
to in subparagraph (A), (B), (C), (D), (E),
(F), (G), (J), (K), (R), or (S) of 31 U.S.C.
5312(a)(2).
Reports required under section 5331
must be in such form as FinCEN may
prescribe. The reports must contain: (1)
The name, address, and such other
identification information as FinCEN
may require, of the person from whom
the coins or currency was received; (2)
1 The BSA is codified at 12 U.S.C. 1829b, 12
U.S.C. 1951–1959, 18 U.S.C. 1956, 18 U.S.C. 1957,
18 U.S.C. 1960, and 31 U.S.C. 5311–5314 and 5316–
5332 and notes thereto, with implementing
regulations at 31 CFR Chapter X. See 31 CFR
1010.100(e).
2 31 U.S.C. 5311.
3 Treasury Order 180–01 (Sept. 26, 2002).
4 31 U.S.C. 5318(h)(2).
5 See, e.g., 31 CFR 1010.310.
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the amount of coins or currency
received; (3) the date and nature of the
transaction; and (4) such other
information, including the identification
of the person filing the report, as
FinCEN may prescribe.
On December 23, 2011, the President
signed the Consolidated Appropriations
Act, 2012 (the ‘‘Act’’) into law. Section
120 of Title I, Division C of the Act
amends 31 U.S.C. 5331 by further
requiring that any persons ‘‘required to
file a report under section 6050I(g) of
the Internal Revenue Code of 1986’’ file
reports with FinCEN in the time and
manner prescribed by regulation.
Section 6050I(g) of title 26 requires
every clerk of a Federal or State criminal
court who receives more than $10,000
in cash as bail for any individual to
make a return of that information. The
amendment to 31 U.S.C. 5331 therefore
authorizes FinCEN to require clerks of
court to report certain currency
transactions.
II. Final Rule
The final rule contained in this
document is intended to enable FinCEN
to receive reports on certain currency
transactions filed by clerks of court.
Since 2002, FinCEN has required
persons engaged in a trade or business
to report certain currency transactions.6
That requirement is deemed satisfied by
the filing of a single Form 8300 for
transactions subject to both the IRS’s
rule 7 and FinCEN’s rule. The
underlying statutory authority for
FinCEN’s 2001 rule did not authorize
reporting by clerks of court.
Consequently, any Form 8300 filed
since 2002 by a clerk of court was
reported pursuant to the IRS’s rule and
FinCEN’s ability to access and share
further such information has been
limited because of the applicable
restrictions on disclosure in the U.S. tax
code. During calendar year 2010,
approximately 7,600 Form 8300s were
filed by clerks of court, representing
roughly 2 percent of the total number of
Form 8300s filed for that year. FinCEN
has determined that the information
contained in such reports can be highly
useful in criminal, tax, and regulatory
investigations or proceedings, and in the
conduct of intelligence or counterintelligence activities, to protect against
international terrorism.
As amended, section 5331(a)(2) now
requires reporting to FinCEN of the
same transaction that must be reported
to the IRS under 26 U.S.C. 6050I(g) and
26 CFR 1.6050I–2. Because section
6 66 FR 67680 (December 31, 2001), codified at 31
CFR 1010.330.
7 26 CFR 1.6050I–1.
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5331(a)(2) and section 6050I(g) of Title
26 are identical in terms of reporting to
Treasury,8 the final rule contained in
this document provides that clerks of
court required to report a transaction
under section 5331(a)(2) must make that
report by filing a joint FinCEN/IRS Form
8300 with Treasury. Under this dual
reporting regime, only one form is
required to be filed for a transaction
subject to both section 5331(a)(2) and
section 6050I(g) of title 26. Use of the
Form 8300 currently used by clerks of
court to satisfy 26 U.S.C. 6050I(g) and
26 CFR 1.6050I–2 will satisfy the
requirement under the final rule. Thus,
the final rule imposes no new reporting
or recordkeeping burden on clerks of
court.
Because the IRS authority and the
FinCEN authority governing the
reporting to Treasury of certain currency
transactions by clerks of court are
identical, FinCEN believes it is
appropriate for the final rule to adopt
the same definitions and rules relating
to the time and manner of reporting,
including verifying the identity of each
payor of bail listed in the report. Thus,
for example, the final rule defines a
clerk of court to mean, with respect to
a Federal or a State court, the clerks’
office or the office, department,
division, branch, or unit of the court
that is authorized to receive bail.
The final rule makes two other nonsubstantive conforming changes to
FinCEN’s rule requiring a trade or
business to report certain currency
transactions. The first change amends
the trade or business rule to
acknowledge that the same information
is now required to be reported to
Treasury under both 26 U.S.C. 6050I
and 31 U.S.C. 5331. The second change
to the trade or business rule reflects that
the definition of currency used therein
is slightly different from the definition
used in the clerks of court rule, and
therefore is not applicable for purposes
of 31 U.S.C. 5331 in all cases.
III. Notice and Comment Under the
Administrative Procedure Act
The Administrative Procedure Act (5
U.S.C. 553) (‘‘APA’’) allows an agency to
dispense with notice and comment
when it would be impractical,
unnecessary, or contrary to the public
interest. Because the final rule affects
8 Section 5331 does not require the person
making a report (either as a trade or business or a
clerk of court) to furnish a statement concerning the
report to: (i) the person whose name is required to
be set forth on the report; or (ii) Federal prosecutors
for the jurisdiction in which such person resides
and the jurisdiction in which the specified criminal
offense occurred. Cf. 26 U.S.C. 6050I(e) and (g). The
final rule therefore does not place any of these
notification requirements upon clerks of court.
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Federal Register / Vol. 77, No. 110 / Thursday, June 7, 2012 / Rules and Regulations
only clerks of court and imposes no new
or additional burden on them, notice
and public comment are unnecessary.
IV. Regulatory Flexibility Act
The provisions of the Regulatory
Flexibility Act relating to initial and
final regulatory analysis (5 U.S.C. 604)
are not applicable to the final rule
contained in this document because
FinCEN was not required to publish a
notice of proposed rulemaking under 5
U.S.C. 553 or any other law.
V. Paperwork Reduction Act
This regulation is being issued
without prior notice and public
comment pursuant to the APA. For this
reason, the collection of information
contained in this regulation has been
reviewed under the requirements of the
Paperwork Reduction Act (44 U.S.C.
3507(j)) and approved by the Office of
Management and Budget (OMB) under
control number 1506–0018. An agency
may not conduct or sponsor, and a
person is not required to respond to, a
collection of information unless it
displays a valid control number
assigned by OMB.
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VI. Executive Orders 13563 and 12866
Executive Orders 13563 and 12866
direct agencies to assess all costs and
benefits of available regulatory
alternatives and, if regulation is
necessary, to select regulatory
approaches that maximize net benefits
(including potential economic,
environmental, public health and safety
effects, distributive impacts, and
equity). Executive Order 13563
emphasizes the importance of
quantifying both costs and benefits, of
reducing costs, of harmonizing rules,
and of promoting flexibility. It has been
determined that the final rule is neither
an economically significant regulatory
action nor a significant regulatory action
for purposes of Executive Orders 13563
and 12866.
VII. Unfunded Mandates Reform Act of
1995 Statement
Section 202 of the Unfunded
Mandates Reform Act of 1995
(‘‘Unfunded Mandates Act’’), Public
Law 104–4 (March 22, 1995), requires
that an agency prepare a budgetary
impact statement before promulgating a
rule 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
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promulgating a rule. FinCEN has
determined that it is not required to
prepare a written statement under
section 202.
List of Subjects in 31 CFR Part 1010
Administrative practice and
procedure, Banks, Banking, Brokers,
Currency, Foreign banking, Foreign
currencies, Gambling, Investigations,
Penalties, Reporting and recordkeeping
requirements, Securities, Terrorism.
Authority and Issuance
For the reasons set forth above,
Chapter X of title 31 of the Code of
Federal Regulations is amended as
follows:
PART 1010—GENERAL PROVISIONS
1. The authority citation for part 1010
continues to read as follows:
■
Authority: 12 U.S.C. 1829b and 1951–
1959, 31 U.S.C. 5311–5314 and 5316–5332,
title III, sec. 314, Pub. L. 107–56, 115 Stat.
307.
2. Amend § 1010.330 by revising
paragraph (a)(1)(ii) and the introductory
text to paragraph (c)(1) to read as
follows:
■
§ 1010.330 Reports relating to currency in
excess of $10,000 received in a trade or
business.
(a) * * *
(1) * * *
(ii) Certain financial transactions.
Section 6050I of title 26 of the United
States Code requires persons to report
information about financial transactions
to the IRS, and 31 U.S.C. 5331 requires
persons to report the same information
to the Financial Crimes Enforcement
Network. This information shall be
reported on the same form as prescribed
by the Secretary.
*
*
*
*
*
(c) * * *
(1) Currency. The term currency
means—
*
*
*
*
*
■ 3. Add new § 1010.331 to read as
follows:
§ 1010.331 Reports relating to currency in
excess of $10,000 received as bail by court
clerks.
(a) Reporting requirement.—(1) In
general. Any clerk of a Federal or State
court who receives more than $10,000
in currency as bail for any individual
charged with a specified criminal
offense must make a report of
information with respect to that receipt
of currency. For purposes of this
section, a clerk is the clerk’s office or
the office, department, division, branch,
or unit of the court that is authorized to
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33637
receive bail. If someone other than a
clerk receives bail on behalf of a clerk,
the clerk is treated as receiving the bail
for purposes of this paragraph (a).
(2) Certain financial transactions.
Section 6050I of title 26 of the United
States Code requires clerks to report
information about financial transactions
to the IRS, and 31 U.S.C. 5331 require
clerks to report the same information to
the Financial Crimes Enforcement
Network. This information shall be
reported on the same form as prescribed
by the Secretary.
(b) Meaning of terms. The following
definitions apply for purposes of this
section—
(1) The term currency means—
(i) The coin and currency of the
United States, or of any other country,
that circulate in and are customarily
used and accepted as money in the
country in which issued; and
(ii) A cashier’s check (by whatever
name called, including treasurer’s check
and bank check), bank draft, traveler’s
check, or money order having a face
amount of not more than $ 10,000.
(2) The term specified criminal
offense means—
(i) A Federal criminal offense
involving a controlled substance (as
defined in section 802 of title 21 of the
United States Code), provided the
offense is described in Part D of
Subchapter I or Subchapter II of title 21
of the United States Code;
(ii) Racketeering (as defined in section
1951, 1952, or 1955 of title 18 of the
United States Code);
(iii) Money laundering (as defined in
section 1956 or 1957 of title 18 of the
United States Code); and
(iv) Any State criminal offense
substantially similar to an offense
described in this paragraph (b)(2) of this
section.
(c) Time, form, and manner of
reporting.—(1) In general. The reports
required by paragraph (a) of this section
must be made by filing a Form 8300, as
specified in 26 CFR 1.6050I–2(c)(2). The
report must be filed at the time and in
the manner specified in 26 CFR
1.6050I–2(c)(1) and (3), respectively.
(2) Verification of identity. A clerk
required to make a report under this
section must, in accordance with 26
CFR 1.6050I–2(c)(3)(ii), verify the
identity of each payor of bail listed in
the report.
Dated: June 1, 2012.
James H. Freis, Jr.,
Director, Financial Crimes Enforcement
Network.
[FR Doc. 2012–13783 Filed 6–6–12; 8:45 am]
BILLING CODE 4810–02–P
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[Federal Register Volume 77, Number 110 (Thursday, June 7, 2012)]
[Rules and Regulations]
[Pages 33635-33637]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-13783]
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Financial Crimes Enforcement Network
31 CFR Part 1010
RIN 1506-AB17
Amendment to the Bank Secrecy Act Regulations--Requirement That
Clerks of Court Report Certain Currency Transactions
AGENCY: Financial Crimes Enforcement Network (``FinCEN''), Treasury.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: FinCEN is amending the rules relating to the reporting of
certain currency transactions consistent with a recent statutory
amendment authorizing FinCEN to require clerks of court to file such
reports with the U.S. Department of the Treasury. Such information
already is required to be reported by clerks of court pursuant to
regulations issued by the Internal Revenue Service (``IRS''), but
FinCEN heretofore has been limited in its ability to access and share
further that information because of minor differences between the
relevant statutory authorities applicable to FinCEN and the IRS.
DATES: Effective Date: July 9, 2012.
FOR FURTHER INFORMATION CONTACT: The FinCEN regulatory helpline at
(800) 949-2732 and select Option 6.
[[Page 33636]]
SUPPLEMENTARY INFORMATION:
I. Statutory Provisions
FinCEN exercises regulatory functions primarily under the Currency
and Financial Transactions Reporting Act of 1970, as amended by the USA
PATRIOT Act of 2001 and other legislation, which legislative framework
is commonly referred to as the ``Bank Secrecy Act'' (``BSA''),\1\ which
authorizes the Secretary of the Treasury (``Secretary'') to require
financial institutions to keep records and file reports that ``have a
high degree of usefulness in criminal, tax, or regulatory proceedings,
or in the conduct of intelligence or counterintelligence activities,
including analysis, to protect against international terrorism.\2\ The
Secretary has delegated to the Director of FinCEN the authority to
implement, administer, and enforce compliance with the BSA and
associated regulations.\3\ FinCEN is authorized to impose anti-money
laundering (``AML'') program requirements on financial institutions.\4\
---------------------------------------------------------------------------
\1\ The BSA is codified at 12 U.S.C. 1829b, 12 U.S.C. 1951-1959,
18 U.S.C. 1956, 18 U.S.C. 1957, 18 U.S.C. 1960, and 31 U.S.C. 5311-
5314 and 5316-5332 and notes thereto, with implementing regulations
at 31 CFR Chapter X. See 31 CFR 1010.100(e).
\2\ 31 U.S.C. 5311.
\3\ Treasury Order 180-01 (Sept. 26, 2002).
\4\ 31 U.S.C. 5318(h)(2).
---------------------------------------------------------------------------
Under 31 U.S.C. 5331, any person who is engaged in a trade or
business and who, in the course of such trade or business, receives
more than $10,000 in coins or currency in one transaction (or two or
more related transactions) is required to file a report with respect to
such transaction (or related transactions) with FinCEN. Reporting under
section 5331 does not apply to amounts received in a transaction
reported under 31 U.S.C. 5313 and its implementing regulations.\5\
---------------------------------------------------------------------------
\5\ See, e.g., 31 CFR 1010.310.
---------------------------------------------------------------------------
For purposes of section 5331, currency includes foreign currency,
and to the extent provided in regulations, any monetary instrument,
whether or not in bearer form, with a face amount of not more than
$10,000. Such monetary instruments shall not include any check drawn on
the account of the writer in a financial institution referred to in
subparagraph (A), (B), (C), (D), (E), (F), (G), (J), (K), (R), or (S)
of 31 U.S.C. 5312(a)(2).
Reports required under section 5331 must be in such form as FinCEN
may prescribe. The reports must contain: (1) The name, address, and
such other identification information as FinCEN may require, of the
person from whom the coins or currency was received; (2) the amount of
coins or currency received; (3) the date and nature of the transaction;
and (4) such other information, including the identification of the
person filing the report, as FinCEN may prescribe.
On December 23, 2011, the President signed the Consolidated
Appropriations Act, 2012 (the ``Act'') into law. Section 120 of Title
I, Division C of the Act amends 31 U.S.C. 5331 by further requiring
that any persons ``required to file a report under section 6050I(g) of
the Internal Revenue Code of 1986'' file reports with FinCEN in the
time and manner prescribed by regulation. Section 6050I(g) of title 26
requires every clerk of a Federal or State criminal court who receives
more than $10,000 in cash as bail for any individual to make a return
of that information. The amendment to 31 U.S.C. 5331 therefore
authorizes FinCEN to require clerks of court to report certain currency
transactions.
II. Final Rule
The final rule contained in this document is intended to enable
FinCEN to receive reports on certain currency transactions filed by
clerks of court. Since 2002, FinCEN has required persons engaged in a
trade or business to report certain currency transactions.\6\ That
requirement is deemed satisfied by the filing of a single Form 8300 for
transactions subject to both the IRS's rule \7\ and FinCEN's rule. The
underlying statutory authority for FinCEN's 2001 rule did not authorize
reporting by clerks of court. Consequently, any Form 8300 filed since
2002 by a clerk of court was reported pursuant to the IRS's rule and
FinCEN's ability to access and share further such information has been
limited because of the applicable restrictions on disclosure in the
U.S. tax code. During calendar year 2010, approximately 7,600 Form
8300s were filed by clerks of court, representing roughly 2 percent of
the total number of Form 8300s filed for that year. FinCEN has
determined that the information contained in such reports can be highly
useful in criminal, tax, and regulatory investigations or proceedings,
and in the conduct of intelligence or counter-intelligence activities,
to protect against international terrorism.
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\6\ 66 FR 67680 (December 31, 2001), codified at 31 CFR
1010.330.
\7\ 26 CFR 1.6050I-1.
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As amended, section 5331(a)(2) now requires reporting to FinCEN of
the same transaction that must be reported to the IRS under 26 U.S.C.
6050I(g) and 26 CFR 1.6050I-2. Because section 5331(a)(2) and section
6050I(g) of Title 26 are identical in terms of reporting to
Treasury,\8\ the final rule contained in this document provides that
clerks of court required to report a transaction under section
5331(a)(2) must make that report by filing a joint FinCEN/IRS Form 8300
with Treasury. Under this dual reporting regime, only one form is
required to be filed for a transaction subject to both section
5331(a)(2) and section 6050I(g) of title 26. Use of the Form 8300
currently used by clerks of court to satisfy 26 U.S.C. 6050I(g) and 26
CFR 1.6050I-2 will satisfy the requirement under the final rule. Thus,
the final rule imposes no new reporting or recordkeeping burden on
clerks of court.
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\8\ Section 5331 does not require the person making a report
(either as a trade or business or a clerk of court) to furnish a
statement concerning the report to: (i) the person whose name is
required to be set forth on the report; or (ii) Federal prosecutors
for the jurisdiction in which such person resides and the
jurisdiction in which the specified criminal offense occurred. Cf.
26 U.S.C. 6050I(e) and (g). The final rule therefore does not place
any of these notification requirements upon clerks of court.
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Because the IRS authority and the FinCEN authority governing the
reporting to Treasury of certain currency transactions by clerks of
court are identical, FinCEN believes it is appropriate for the final
rule to adopt the same definitions and rules relating to the time and
manner of reporting, including verifying the identity of each payor of
bail listed in the report. Thus, for example, the final rule defines a
clerk of court to mean, with respect to a Federal or a State court, the
clerks' office or the office, department, division, branch, or unit of
the court that is authorized to receive bail.
The final rule makes two other non-substantive conforming changes
to FinCEN's rule requiring a trade or business to report certain
currency transactions. The first change amends the trade or business
rule to acknowledge that the same information is now required to be
reported to Treasury under both 26 U.S.C. 6050I and 31 U.S.C. 5331. The
second change to the trade or business rule reflects that the
definition of currency used therein is slightly different from the
definition used in the clerks of court rule, and therefore is not
applicable for purposes of 31 U.S.C. 5331 in all cases.
III. Notice and Comment Under the Administrative Procedure Act
The Administrative Procedure Act (5 U.S.C. 553) (``APA'') allows an
agency to dispense with notice and comment when it would be
impractical, unnecessary, or contrary to the public interest. Because
the final rule affects
[[Page 33637]]
only clerks of court and imposes no new or additional burden on them,
notice and public comment are unnecessary.
IV. Regulatory Flexibility Act
The provisions of the Regulatory Flexibility Act relating to
initial and final regulatory analysis (5 U.S.C. 604) are not applicable
to the final rule contained in this document because FinCEN was not
required to publish a notice of proposed rulemaking under 5 U.S.C. 553
or any other law.
V. Paperwork Reduction Act
This regulation is being issued without prior notice and public
comment pursuant to the APA. For this reason, the collection of
information contained in this regulation has been reviewed under the
requirements of the Paperwork Reduction Act (44 U.S.C. 3507(j)) and
approved by the Office of Management and Budget (OMB) under control
number 1506-0018. An agency may not conduct or sponsor, and a person is
not required to respond to, a collection of information unless it
displays a valid control number assigned by OMB.
VI. Executive Orders 13563 and 12866
Executive Orders 13563 and 12866 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). Executive
Order 13563 emphasizes the importance of quantifying both costs and
benefits, of reducing costs, of harmonizing rules, and of promoting
flexibility. It has been determined that the final rule is neither an
economically significant regulatory action nor a significant regulatory
action for purposes of Executive Orders 13563 and 12866.
VII. Unfunded Mandates Reform Act of 1995 Statement
Section 202 of the Unfunded Mandates Reform Act of 1995 (``Unfunded
Mandates Act''), Public Law 104-4 (March 22, 1995), requires that an
agency prepare a budgetary impact statement before promulgating a rule
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. FinCEN has determined that it is not required to
prepare a written statement under section 202.
List of Subjects in 31 CFR Part 1010
Administrative practice and procedure, Banks, Banking, Brokers,
Currency, Foreign banking, Foreign currencies, Gambling,
Investigations, Penalties, Reporting and recordkeeping requirements,
Securities, Terrorism.
Authority and Issuance
For the reasons set forth above, Chapter X of title 31 of the Code
of Federal Regulations is amended as follows:
PART 1010--GENERAL PROVISIONS
0
1. The authority citation for part 1010 continues to read as follows:
Authority: 12 U.S.C. 1829b and 1951-1959, 31 U.S.C. 5311-5314
and 5316-5332, title III, sec. 314, Pub. L. 107-56, 115 Stat. 307.
0
2. Amend Sec. 1010.330 by revising paragraph (a)(1)(ii) and the
introductory text to paragraph (c)(1) to read as follows:
Sec. 1010.330 Reports relating to currency in excess of $10,000
received in a trade or business.
(a) * * *
(1) * * *
(ii) Certain financial transactions. Section 6050I of title 26 of
the United States Code requires persons to report information about
financial transactions to the IRS, and 31 U.S.C. 5331 requires persons
to report the same information to the Financial Crimes Enforcement
Network. This information shall be reported on the same form as
prescribed by the Secretary.
* * * * *
(c) * * *
(1) Currency. The term currency means--
* * * * *
0
3. Add new Sec. 1010.331 to read as follows:
Sec. 1010.331 Reports relating to currency in excess of $10,000
received as bail by court clerks.
(a) Reporting requirement.--(1) In general. Any clerk of a Federal
or State court who receives more than $10,000 in currency as bail for
any individual charged with a specified criminal offense must make a
report of information with respect to that receipt of currency. For
purposes of this section, a clerk is the clerk's office or the office,
department, division, branch, or unit of the court that is authorized
to receive bail. If someone other than a clerk receives bail on behalf
of a clerk, the clerk is treated as receiving the bail for purposes of
this paragraph (a).
(2) Certain financial transactions. Section 6050I of title 26 of
the United States Code requires clerks to report information about
financial transactions to the IRS, and 31 U.S.C. 5331 require clerks to
report the same information to the Financial Crimes Enforcement
Network. This information shall be reported on the same form as
prescribed by the Secretary.
(b) Meaning of terms. The following definitions apply for purposes
of this section--
(1) The term currency means--
(i) The coin and currency of the United States, or of any other
country, that circulate in and are customarily used and accepted as
money in the country in which issued; and
(ii) A cashier's check (by whatever name called, including
treasurer's check and bank check), bank draft, traveler's check, or
money order having a face amount of not more than $ 10,000.
(2) The term specified criminal offense means--
(i) A Federal criminal offense involving a controlled substance (as
defined in section 802 of title 21 of the United States Code), provided
the offense is described in Part D of Subchapter I or Subchapter II of
title 21 of the United States Code;
(ii) Racketeering (as defined in section 1951, 1952, or 1955 of
title 18 of the United States Code);
(iii) Money laundering (as defined in section 1956 or 1957 of title
18 of the United States Code); and
(iv) Any State criminal offense substantially similar to an offense
described in this paragraph (b)(2) of this section.
(c) Time, form, and manner of reporting.--(1) In general. The
reports required by paragraph (a) of this section must be made by
filing a Form 8300, as specified in 26 CFR 1.6050I-2(c)(2). The report
must be filed at the time and in the manner specified in 26 CFR
1.6050I-2(c)(1) and (3), respectively.
(2) Verification of identity. A clerk required to make a report
under this section must, in accordance with 26 CFR 1.6050I-2(c)(3)(ii),
verify the identity of each payor of bail listed in the report.
Dated: June 1, 2012.
James H. Freis, Jr.,
Director, Financial Crimes Enforcement Network.
[FR Doc. 2012-13783 Filed 6-6-12; 8:45 am]
BILLING CODE 4810-02-P
