Civil Monetary Penalties Inflation Adjustments for Ethics in Government Act Violations, 8131-8133 [2017-00627]

Download as PDF 8131 Rules and Regulations Federal Register Vol. 82, No. 14 Tuesday, January 24, 2017 This section of the FEDERAL REGISTER contains regulatory documents having general applicability and legal effect, most of which are keyed to and codified in the Code of Federal Regulations, which is published under 50 titles pursuant to 44 U.S.C. 1510. The Code of Federal Regulations is sold by the Superintendent of Documents. Prices of new books are listed in the first FEDERAL REGISTER issue of each week. OFFICE OF GOVERNMENT ETHICS 5 CFR Parts 2634 and 2636 RINs 3209–AA00 and 3209–AA38 Civil Monetary Penalties Inflation Adjustments for Ethics in Government Act Violations Office of Government Ethics. Final rule. AGENCY: ACTION: The U.S. Office of Government Ethics (OGE) is issuing this final rule in accordance with the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. This rulemaking adopts as final prior interim regulations making ‘‘catchup’’ inflationary adjustments to each of the five civil monetary penalties provided in the Ethics in Government Act, as reflected in the executive branchwide financial disclosure and outside employment/activities regulations promulgated by OGE. This rulemaking also makes the 2017 annual adjustment to the Ethics in Government Act civil monetary penalties mandated by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. DATES: Effective date: This final rule is effective January 24, 2017. Applicability date: This final rule is applicable January 15, 2017. FOR FURTHER INFORMATION CONTACT: Kimberly L. Sikora Panza, Associate Counsel, General Counsel and Legal Policy Division, Office of Government Ethics, Telephone: 202–482–9300; TTY: 800–877–8339; FAX: 202–482–9237. SUPPLEMENTARY INFORMATION: sradovich on DSK3GMQ082PROD with RULES SUMMARY: I. Background ‘‘Catch-up’’ Adjustment to Ethics in Government Act Civil Monetary Penalties In November 2015, Congress passed the Federal Civil Penalties Inflation VerDate Sep<11>2014 17:47 Jan 23, 2017 Jkt 241001 Adjustment Act Improvements Act of 2015 (Sec. 701 of Pub. L. 114–74) (the 2015 Act), which further amended the Federal Civil Penalties Inflation Adjustment Act of 1990 (Pub. L. 101– 410). The 2015 Act required Federal agencies to make inflationary adjustments to the civil monetary penalties (CMPs) within their jurisdiction with an initial ‘‘catch-up’’ adjustment through an interim final rule effective no later than August 1, 2016. The 2015 Act further mandates that Federal agencies make subsequent annual inflationary adjustments of their CMPs, to be effective no later than January 15 of each year. In compliance with the 2015 Act and guidance issued by the Office of Management and Budget (OMB), on June 28, 2016, the U.S. Office of Government Ethics (OGE) published in the Federal Register an interim final rule with request for comments, 81 FR 41787 (June 28, 2016). The interim final rule, which became effective on August 1, 2016, made inflationary adjustments to the five CMPs provided in the Ethics in Government Act of 1978 as amended, 5 U.S.C. appendix (the Ethics Act).1 The Ethics Act provides for penalties that can be assessed by an appropriate United States district court, based upon a civil action brought by the Department of Justice, for the following five types of violations: Knowing and willful failure to file, report required information on, or falsification of a public financial disclosure report; knowing and willful breach of a qualified trust by trustees and interested parties; negligent breach of a qualified trust by trustees and interested parties; misuse of a public report; and violation of outside employment/activities provisions. See sections 102(f)(6)(C)(i) and (ii), 104(a), 105(c)(2) and 504(a) of the Ethics Act, 5 U.S.C. appendix, 102(f)(6)(C)(i) and (ii), 104(a), 105(c)(2) and 504(a). These penalties are reflected in 5 CFR 2634.701(b), 2634.702(a) and (b), and 2634.703 of OGE’s executive 1 OGE has previously determined, after consultation with the Department of Justice, that the $200 late filing fee for public financial disclosure reports that are more than 30 days overdue (see section 104(d) of the Ethics Act, 5 U.S.C. appendix, 104(d), and 5 CFR 2634.704 of OGE’s regulations thereunder) is not a CMP as defined under the Federal Civil Penalties Inflation Adjustment Act, as amended. Therefore, that fee is not being adjusted in this rulemaking (nor was it adjusted by OGE in previous CMP rulemakings), and will remain at its current amount of $200. PO 00000 Frm 00001 Fmt 4700 Sfmt 4700 branchwide financial disclosure regulation and 5 CFR 2636.104(a) of OGE’s executive branchwide covered noncareer employee outside employment/activities regulation. As explained in the preamble to the interim final rule, the increased civil monetary penalty amounts calculated in OGE’s ‘‘catch-up’’ adjustment applied only to civil penalties assessed after August 1, 2016 whose associated violations occurred after November 2, 2015, the date of enactment of the 2015 Act. For the sake of clarity, OGE’s interim final rule stated the original, previously-adjusted and newly-adjusted Ethics Act CMP amounts. OGE received no comments on the interim final rule, and therefore is adopting it as final in this rulemaking. Annual Inflationary Adjustment to the Ethics in Government Act Civil Monetary Penalties Beginning in 2017, the 2015 Act requires Federal agencies to make annual inflationary adjustments to their CMPs. The annual adjustments are based on the percent change between the Consumer Price Index for all Urban Consumers (CPI–U) for the month of October preceding the date of the adjustment, and the prior year’s October CPI–U. Pursuant to OMB guidance, the cost-of-living adjustment multiplier for 2017, based on the CPI–U for October 2016, not seasonally adjusted, is 1.01636. To calculate the 2017 annual adjustment, agencies must multiply the most recent penalty by the 1.01636 multiplier, and round to the nearest dollar. Applying the formula established by the 2015 Act and OMB guidance, OGE is amending the Ethics Act CMPs through this rulemaking to: (1) Increase the three penalties reflected in 5 CFR 2634.702(a), 5 CFR 2634.703, and 5 CFR 2636.104(a)— which were previously adjusted to a maximum of $18,936—to a maximum of $19,246; (2) Increase the penalty reflected in 5 CFR 2634.702(b)—which was previously adjusted to a maximum of $9,468—to a maximum of $9,623; and (3) Increase the penalty reflected in 5 CFR 2634.701(b)—which was previously adjusted to a maximum of $56,916—to a maximum of $57,847. Consistent with the implementation of the ‘‘catch-up’’ penalty adjustments, these adjusted penalty amounts will E:\FR\FM\24JAR1.SGM 24JAR1 8132 Federal Register / Vol. 82, No. 14 / Tuesday, January 24, 2017 / Rules and Regulations apply only to penalties assessed after January 15, 2017 (the applicability date of this final rule) whose associated violations occurred after November 2, 2015. OGE will continue to make future annual inflationary adjustments to the Ethics Act CMPs in accordance with the statutory formula set forth in the 2015 Act. II. Matters of Regulatory Procedure Administrative Procedure Act Pursuant to 5 U.S.C. 553(b), as Director of the Office of Government Ethics, I find that good cause exists for waiving the general notice of proposed rulemaking and public comment procedures as to these technical amendments. The notice and comment procedures are being waived because these amendments, which concern matters of agency organization, procedure and practice, are being adopted in accordance with statutorily mandated inflation adjustment procedures of the 2015 Act, which specifies that agencies shall adjust civil monetary penalties notwithstanding Section 553 of the Administrative Procedure Act. It is also in the public interest that the adjusted rates for civil monetary penalties under the Ethics in Government Act become effective as soon as possible in order to maintain their deterrent effect. Executive Order 13563 and Executive Order 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 the regulatory approaches that maximize net benefits (including 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. The Office of Management and Budget has determined that rulemakings such as this implementing annual inflationary adjustments under the 2015 Act are not significant regulatory actions under Executive Order 12866. Executive Order 12988 As Director of the Office of Government Ethics, I have reviewed this rule in light of section 3 of Executive Order 12988, Civil Justice Reform, and certify that it meets the applicable standards provided therein. List of Subjects 5 CFR Part 2634 Certificates of divestiture, Conflict of interests, Government employees, Penalties, Reporting and recordkeeping requirements, Trusts and trustees. Regulatory Flexibility Act 5 CFR Part 2636 As the Director of the Office of Government Ethics, I certify under the Regulatory Flexibility Act (5 U.S.C. chapter 6) that this final rule would not have a significant economic impact on a substantial number of small entities because it primarily affects current Federal executive branch employees. Conflict of interests, Government employees, Penalties. Paperwork Reduction Act The Paperwork Reduction Act (44 U.S.C. chapter 35) does not apply because this regulation does not contain information collection requirements that require approval of the Office of Management and Budget. sradovich on DSK3GMQ082PROD with RULES Jkt 241001 PART 2634—EXECUTIVE BRANCH FINANCIAL DISCLOSURE, QUALIFIED TRUSTS, AND CERTIFICATES OF DIVESTITURE § 2634.701 reports. Failure to file or falsifying * * * * * (b) Civil action. The Attorney General may bring a civil action in any appropriate United States district court against any individual who knowingly and willfully falsifies or who knowingly and willfully fails to file or report any information required by filers of public reports under subpart B of this part. The court in which the action is brought may assess against the individual a civil monetary penalty in any amount, not to exceed the amounts set forth below, as provided by section 104(a) of the Act, as amended, and as adjusted in accordance with the inflation adjustment procedures prescribed in the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended: Date of violation Violation occurring between Sept. 14, 2007 and Nov. 2, 2015 ....... Violation occurring after Nov. 2, 2015 .......................................... 1. The authority citation for part 2634 continues to read as follows: Penalty $50,000 57,847 * * * * * 3. Section 2634.702 is revised to read as follows: ■ § 2634.702 Breaches by trust fiduciaries and interested parties. (a) The Attorney General may bring a civil action in any appropriate United States district court against any individual who knowingly and willfully violates the provisions of § 2634.408(d)(1) or (e)(1). The court in which the action is brought may assess against the individual a civil monetary penalty in any amount, not to exceed the amounts set forth below, as provided by section 102(f)(6)(C)(i) of the Act and as adjusted in accordance with the inflation adjustment procedures prescribed in the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended: Penalty ■ For purposes of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. chapter 5, subchapter II), this rule would not significantly or uniquely affect small governments and will not result in increased expenditures by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (as adjusted for inflation) in any one year. 17:47 Jan 23, 2017 Accordingly, for the reasons set forth in the preamble, the U.S. Office of Government Ethics is adopting the interim final rule published at 81 FR 41787 (June 28, 2016) as a final rule with the following changes: 2. Section 2634.701 is amended by revising paragraph (b) to read as follows: ■ Date of violation Unfunded Mandates Reform Act VerDate Sep<11>2014 Dated: January 9, 2017. Walter M. Shaub, Jr., Director, U.S. Office of Government Ethics. FR 15159, 3 CFR, 1989 Comp., p. 215, as modified by E.O. 12731, 55 FR 42547, 3 CFR, 1990 Comp., p. 306. Authority: 5 U.S.C. App. (Ethics in Government Act of 1978); 26 U.S.C. 1043; Pub. L. 101–410, 104 Stat. 890, 28 U.S.C. 2461 note (Federal Civil Penalties Inflation Adjustment Act of 1990), as amended by Sec. 31001, Pub. L. 104–134, 110 Stat. 1321 (Debt Collection Improvement Act of 1996) and Sec. 701, Pub. L. 114–74 (Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015); E.O. 12674, 54 PO 00000 Frm 00002 Fmt 4700 Sfmt 4700 Violation occurring between Sept. 29, 1999 and Nov. 2, 2015 ....... Violation occurring after Nov. 2, 2015 .......................................... $11,000 19,246 (b) The Attorney General may bring a civil action in any appropriate United States district court against any individual who negligently violates the provisions of § 2634.408(d)(1) or (e)(1). The court in which the action is brought E:\FR\FM\24JAR1.SGM 24JAR1 Federal Register / Vol. 82, No. 14 / Tuesday, January 24, 2017 / Rules and Regulations sradovich on DSK3GMQ082PROD with RULES may assess against the individual a civil monetary penalty in any amount, not to exceed the amounts set forth below, as provided by section 102(f)(6)(C)(ii) of the Act and as adjusted in accordance with the inflation adjustment procedures of the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended: § 2636.104 action. Civil, disciplinary and other (a) Civil action. Except when the employee engages in conduct in good faith reliance upon an advisory opinion issued under § 2636.103, an employee who engages in any conduct in violation of the prohibitions, limitations and restrictions contained in this part may be subject to civil action under 5 U.S.C. app. 504(a) and a civil monetary penalty of not more than the amounts set forth below, as adjusted in accordance with the inflation adjustment procedures prescribed in the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended, or the amount of the compensation the individual received for the prohibited conduct, whichever is greater. 8133 to $10,957 for each false claim or statement. This final rule is effective on January 24, 2017. DATES: Please refer to Docket ID NRC–2016–0165 when contacting the NRC about the availability of information for this action. You may obtain publicly-available information Date of violation Penalty related to this action by any of the following methods: Violation occurring between Sept. 29, 1999 and Nov. 2, 2015 ....... $5,500 • Federal Rulemaking Web site: Go to Violation occurring after Nov. 2, http://www.regulations.gov and search 2015 .......................................... 9,623 for Docket ID NRC–2016–0165. Address questions about NRC dockets to Carol ■ 4. Section 2634.703 is revised to read Gallagher; telephone: 301–415–3463; as follows: email: Carol.Gallagher@nrc.gov. For technical questions, contact the § 2634.703 Misuse of public reports. individual listed in the FOR FURTHER (a) The Attorney General may bring a INFORMATION CONTACT section of this Date of violation Penalty civil action against any person who document. obtains or uses a report filed under this Violation occurring between Sept. • NRC’s Agencywide Documents part for any purpose prohibited by 29, 1999 and Nov. 2, 2015 ....... $11,000 Access and Management System section 105(c)(1) of the Act, as Violation occurring after Nov. 2, incorporated in § 2634.603(f). The court 2015 .......................................... 19,246 (ADAMS): You may obtain publiclyavailable documents online in the in which the action is brought may ADAMS Public Documents collection at assess against the person a civil * * * * * http://www.nrc.gov/reading-rm/ monetary penalty in any amount, not to [FR Doc. 2017–00627 Filed 1–23–17; 8:45 am] adams.html. To begin the search, select exceed the amounts set forth below, as BILLING CODE 6345–03–P ‘‘ADAMS Public Documents’’ and then provided by section 105(c)(2) of the Act select ‘‘Begin Web-based ADAMS and as adjusted in accordance with the Search.’’ For problems with ADAMS, inflation adjustment procedures NUCLEAR REGULATORY please contact the NRC’s Public prescribed in the Federal Civil Penalties COMMISSION Document Room (PDR) reference staff at Inflation Adjustment Act of 1990, as 1–800–397–4209, 301–415–4737, or by amended: 10 CFR Parts 2 and 13 email to pdr.resource@nrc.gov. The [NRC–2016–0165] ADAMS accession number for each Date of violation Penalty document referenced (if it is available in RIN 3150–AJ82 Violation occurring between Sept. ADAMS) is provided the first time that 29, 1999 and Nov. 2, 2015 ....... $11,000 Adjustment of Civil Penalties for it is mentioned in the SUPPLEMENTARY Violation occurring after Nov. 2, Inflation for FY 2017 INFORMATION section. 2015 .......................................... 19,246 • NRC’s PDR: You may examine and AGENCY: Nuclear Regulatory purchase copies of public documents at (b) This remedy shall be in addition Commission. the NRC’s PDR, Room O1–F21, One to any other remedy available under ACTION: Final rule. White Flint North, 11555 Rockville statutory or common law. SUMMARY: The U.S. Nuclear Regulatory Pike, Rockville, Maryland 20852. PART 2636—LIMITATIONS ON Commission (NRC) is amending its OUTSIDE EARNED INCOME, regulations to adjust the maximum civil FOR FURTHER INFORMATION CONTACT: Eric EMPLOYMENT AND AFFILIATIONS monetary penalties (CMPs) it can assess Michel, Office of the General Counsel, telephone: 301–287–3704, email: FOR CERTAIN NONCAREER under statutes enforced by the agency. Eric.Michel2@nrc.gov, U.S. Nuclear EMPLOYEES These changes are mandated by the Regulatory Commission, Washington, Federal Civil Penalties Inflation DC 20555–0001. ■ 5. The authority citation for part 2636 Adjustment Act of 1990 (FCPIAA), as continues to read as follows: amended by the Federal Civil Penalties SUPPLEMENTARY INFORMATION: Authority: 5 U.S.C. App. (Ethics in Inflation Adjustment Act Improvements Table of Contents Government Act of 1978); Pub. L. 101–410, Act of 2015 (2015 Improvements Act). 104 Stat. 890, 28 U.S.C. 2461 note (Federal The NRC is amending its regulations to I. Background Civil Penalties Inflation Adjustment Act of adjust the maximum CMP for a violation 1990), as amended by Sec. 31001, Pub. L. II. Discussion of the Atomic Energy Act of 1954, as 104–134, 110 Stat. 1321 (Debt Collection III. Rulemaking Procedure Improvement Act of 1996) and Sec. 701, Pub. amended (AEA), or any regulation or IV. Section-by-Section Analysis order issued under the AEA from L. 114–74 (Federal Civil Penalties Inflation V. Regulatory Analysis Adjustment Act Improvements Act of 2015); $280,469 to $285,057 per violation, per VI. Regulatory Flexibility Act E.O. 12674, 54 FR 15159, 3 CFR, 1989 Comp., day. Additionally, the NRC is amending VII. Backfitting and Issue Finality p. 215, as modified by E.O. 12731, 55 FR provisions concerning program fraud VIII. Plain Writing 42547, 3 CFR, 1990 Comp., p. 306. civil penalties by adjusting the IX. National Environmental Policy Act ■ 6. Section 2636.104 is amended by maximum CMP under the Program X. Paperwork Reduction Act revising paragraph (a) to read as follows: Fraud Civil Remedies Act from $10,781 XI. Congressional Review Act VerDate Sep<11>2014 17:47 Jan 23, 2017 Jkt 241001 PO 00000 Frm 00003 Fmt 4700 Sfmt 4700 ADDRESSES: E:\FR\FM\24JAR1.SGM 24JAR1

Agencies

[Federal Register Volume 82, Number 14 (Tuesday, January 24, 2017)]
[Rules and Regulations]
[Pages 8131-8133]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-00627]



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Rules and Regulations
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains regulatory documents 
having general applicability and legal effect, most of which are keyed 
to and codified in the Code of Federal Regulations, which is published 
under 50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by the Superintendent of Documents. 
Prices of new books are listed in the first FEDERAL REGISTER issue of each 
week.

========================================================================


Federal Register / Vol. 82, No. 14 / Tuesday, January 24, 2017 / 
Rules and Regulations

[[Page 8131]]


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OFFICE OF GOVERNMENT ETHICS

5 CFR Parts 2634 and 2636

RINs 3209-AA00 and 3209-AA38


Civil Monetary Penalties Inflation Adjustments for Ethics in 
Government Act Violations

AGENCY: Office of Government Ethics.

ACTION: Final rule.

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

SUMMARY: The U.S. Office of Government Ethics (OGE) is issuing this 
final rule in accordance with the Federal Civil Penalties Inflation 
Adjustment Act Improvements Act of 2015. This rulemaking adopts as 
final prior interim regulations making ``catch-up'' inflationary 
adjustments to each of the five civil monetary penalties provided in 
the Ethics in Government Act, as reflected in the executive branchwide 
financial disclosure and outside employment/activities regulations 
promulgated by OGE. This rulemaking also makes the 2017 annual 
adjustment to the Ethics in Government Act civil monetary penalties 
mandated by the Federal Civil Penalties Inflation Adjustment Act 
Improvements Act of 2015.

DATES: Effective date: This final rule is effective January 24, 2017.
    Applicability date: This final rule is applicable January 15, 2017.

FOR FURTHER INFORMATION CONTACT: Kimberly L. Sikora Panza, Associate 
Counsel, General Counsel and Legal Policy Division, Office of 
Government Ethics, Telephone: 202-482-9300; TTY: 800-877-8339; FAX: 
202-482-9237.

SUPPLEMENTARY INFORMATION: 

I. Background

``Catch-up'' Adjustment to Ethics in Government Act Civil Monetary 
Penalties

    In November 2015, Congress passed the Federal Civil Penalties 
Inflation Adjustment Act Improvements Act of 2015 (Sec. 701 of Pub. L. 
114-74) (the 2015 Act), which further amended the Federal Civil 
Penalties Inflation Adjustment Act of 1990 (Pub. L. 101-410). The 2015 
Act required Federal agencies to make inflationary adjustments to the 
civil monetary penalties (CMPs) within their jurisdiction with an 
initial ``catch-up'' adjustment through an interim final rule effective 
no later than August 1, 2016. The 2015 Act further mandates that 
Federal agencies make subsequent annual inflationary adjustments of 
their CMPs, to be effective no later than January 15 of each year.
    In compliance with the 2015 Act and guidance issued by the Office 
of Management and Budget (OMB), on June 28, 2016, the U.S. Office of 
Government Ethics (OGE) published in the Federal Register an interim 
final rule with request for comments, 81 FR 41787 (June 28, 2016). The 
interim final rule, which became effective on August 1, 2016, made 
inflationary adjustments to the five CMPs provided in the Ethics in 
Government Act of 1978 as amended, 5 U.S.C. appendix (the Ethics 
Act).\1\ The Ethics Act provides for penalties that can be assessed by 
an appropriate United States district court, based upon a civil action 
brought by the Department of Justice, for the following five types of 
violations: Knowing and willful failure to file, report required 
information on, or falsification of a public financial disclosure 
report; knowing and willful breach of a qualified trust by trustees and 
interested parties; negligent breach of a qualified trust by trustees 
and interested parties; misuse of a public report; and violation of 
outside employment/activities provisions. See sections 102(f)(6)(C)(i) 
and (ii), 104(a), 105(c)(2) and 504(a) of the Ethics Act, 5 U.S.C. 
appendix, 102(f)(6)(C)(i) and (ii), 104(a), 105(c)(2) and 504(a). These 
penalties are reflected in 5 CFR 2634.701(b), 2634.702(a) and (b), and 
2634.703 of OGE's executive branchwide financial disclosure regulation 
and 5 CFR 2636.104(a) of OGE's executive branchwide covered noncareer 
employee outside employment/activities regulation.
---------------------------------------------------------------------------

    \1\ OGE has previously determined, after consultation with the 
Department of Justice, that the $200 late filing fee for public 
financial disclosure reports that are more than 30 days overdue (see 
section 104(d) of the Ethics Act, 5 U.S.C. appendix, 104(d), and 5 
CFR 2634.704 of OGE's regulations thereunder) is not a CMP as 
defined under the Federal Civil Penalties Inflation Adjustment Act, 
as amended. Therefore, that fee is not being adjusted in this 
rulemaking (nor was it adjusted by OGE in previous CMP rulemakings), 
and will remain at its current amount of $200.
---------------------------------------------------------------------------

    As explained in the preamble to the interim final rule, the 
increased civil monetary penalty amounts calculated in OGE's ``catch-
up'' adjustment applied only to civil penalties assessed after August 
1, 2016 whose associated violations occurred after November 2, 2015, 
the date of enactment of the 2015 Act. For the sake of clarity, OGE's 
interim final rule stated the original, previously-adjusted and newly-
adjusted Ethics Act CMP amounts. OGE received no comments on the 
interim final rule, and therefore is adopting it as final in this 
rulemaking.

Annual Inflationary Adjustment to the Ethics in Government Act Civil 
Monetary Penalties

    Beginning in 2017, the 2015 Act requires Federal agencies to make 
annual inflationary adjustments to their CMPs. The annual adjustments 
are based on the percent change between the Consumer Price Index for 
all Urban Consumers (CPI-U) for the month of October preceding the date 
of the adjustment, and the prior year's October CPI-U. Pursuant to OMB 
guidance, the cost-of-living adjustment multiplier for 2017, based on 
the CPI-U for October 2016, not seasonally adjusted, is 1.01636. To 
calculate the 2017 annual adjustment, agencies must multiply the most 
recent penalty by the 1.01636 multiplier, and round to the nearest 
dollar.
    Applying the formula established by the 2015 Act and OMB guidance, 
OGE is amending the Ethics Act CMPs through this rulemaking to:
    (1) Increase the three penalties reflected in 5 CFR 2634.702(a), 5 
CFR 2634.703, and 5 CFR 2636.104(a)--which were previously adjusted to 
a maximum of $18,936--to a maximum of $19,246;
    (2) Increase the penalty reflected in 5 CFR 2634.702(b)--which was 
previously adjusted to a maximum of $9,468--to a maximum of $9,623; and
    (3) Increase the penalty reflected in 5 CFR 2634.701(b)--which was 
previously adjusted to a maximum of $56,916--to a maximum of $57,847. 
Consistent with the implementation of the ``catch-up'' penalty 
adjustments, these adjusted penalty amounts will

[[Page 8132]]

apply only to penalties assessed after January 15, 2017 (the 
applicability date of this final rule) whose associated violations 
occurred after November 2, 2015.
    OGE will continue to make future annual inflationary adjustments to 
the Ethics Act CMPs in accordance with the statutory formula set forth 
in the 2015 Act.

II. Matters of Regulatory Procedure

Administrative Procedure Act

    Pursuant to 5 U.S.C. 553(b), as Director of the Office of 
Government Ethics, I find that good cause exists for waiving the 
general notice of proposed rulemaking and public comment procedures as 
to these technical amendments. The notice and comment procedures are 
being waived because these amendments, which concern matters of agency 
organization, procedure and practice, are being adopted in accordance 
with statutorily mandated inflation adjustment procedures of the 2015 
Act, which specifies that agencies shall adjust civil monetary 
penalties notwithstanding Section 553 of the Administrative Procedure 
Act. It is also in the public interest that the adjusted rates for 
civil monetary penalties under the Ethics in Government Act become 
effective as soon as possible in order to maintain their deterrent 
effect.

Regulatory Flexibility Act

    As the Director of the Office of Government Ethics, I certify under 
the Regulatory Flexibility Act (5 U.S.C. chapter 6) that this final 
rule would not have a significant economic impact on a substantial 
number of small entities because it primarily affects current Federal 
executive branch employees.

Paperwork Reduction Act

    The Paperwork Reduction Act (44 U.S.C. chapter 35) does not apply 
because this regulation does not contain information collection 
requirements that require approval of the Office of Management and 
Budget.

Unfunded Mandates Reform Act

    For purposes of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 
chapter 5, subchapter II), this rule would not significantly or 
uniquely affect small governments and will not result in increased 
expenditures by State, local, and tribal governments, in the aggregate, 
or by the private sector, of $100 million or more (as adjusted for 
inflation) in any one year.

Executive Order 13563 and Executive Order 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 the regulatory approaches that 
maximize net benefits (including 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. 
The Office of Management and Budget has determined that rulemakings 
such as this implementing annual inflationary adjustments under the 
2015 Act are not significant regulatory actions under Executive Order 
12866.

Executive Order 12988

    As Director of the Office of Government Ethics, I have reviewed 
this rule in light of section 3 of Executive Order 12988, Civil Justice 
Reform, and certify that it meets the applicable standards provided 
therein.

List of Subjects

5 CFR Part 2634

    Certificates of divestiture, Conflict of interests, Government 
employees, Penalties, Reporting and recordkeeping requirements, Trusts 
and trustees.

5 CFR Part 2636

    Conflict of interests, Government employees, Penalties.

    Dated: January 9, 2017.
Walter M. Shaub, Jr.,
Director, U.S. Office of Government Ethics.

    Accordingly, for the reasons set forth in the preamble, the U.S. 
Office of Government Ethics is adopting the interim final rule 
published at 81 FR 41787 (June 28, 2016) as a final rule with the 
following changes:

PART 2634--EXECUTIVE BRANCH FINANCIAL DISCLOSURE, QUALIFIED TRUSTS, 
AND CERTIFICATES OF DIVESTITURE

0
1. The authority citation for part 2634 continues to read as follows:

    Authority:  5 U.S.C. App. (Ethics in Government Act of 1978); 26 
U.S.C. 1043; Pub. L. 101-410, 104 Stat. 890, 28 U.S.C. 2461 note 
(Federal Civil Penalties Inflation Adjustment Act of 1990), as 
amended by Sec. 31001, Pub. L. 104-134, 110 Stat. 1321 (Debt 
Collection Improvement Act of 1996) and Sec. 701, Pub. L. 114-74 
(Federal Civil Penalties Inflation Adjustment Act Improvements Act 
of 2015); E.O. 12674, 54 FR 15159, 3 CFR, 1989 Comp., p. 215, as 
modified by E.O. 12731, 55 FR 42547, 3 CFR, 1990 Comp., p. 306.

0
2. Section 2634.701 is amended by revising paragraph (b) to read as 
follows:


Sec.  2634.701   Failure to file or falsifying reports.

* * * * *
    (b) Civil action. The Attorney General may bring a civil action in 
any appropriate United States district court against any individual who 
knowingly and willfully falsifies or who knowingly and willfully fails 
to file or report any information required by filers of public reports 
under subpart B of this part. The court in which the action is brought 
may assess against the individual a civil monetary penalty in any 
amount, not to exceed the amounts set forth below, as provided by 
section 104(a) of the Act, as amended, and as adjusted in accordance 
with the inflation adjustment procedures prescribed in the Federal 
Civil Penalties Inflation Adjustment Act of 1990, as amended:

------------------------------------------------------------------------
                      Date of violation                         Penalty
------------------------------------------------------------------------
Violation occurring between Sept. 14, 2007 and Nov. 2, 2015..    $50,000
Violation occurring after Nov. 2, 2015.......................     57,847
------------------------------------------------------------------------

* * * * *

0
3. Section 2634.702 is revised to read as follows:


Sec.  2634.702  Breaches by trust fiduciaries and interested parties.

    (a) The Attorney General may bring a civil action in any 
appropriate United States district court against any individual who 
knowingly and willfully violates the provisions of Sec.  2634.408(d)(1) 
or (e)(1). The court in which the action is brought may assess against 
the individual a civil monetary penalty in any amount, not to exceed 
the amounts set forth below, as provided by section 102(f)(6)(C)(i) of 
the Act and as adjusted in accordance with the inflation adjustment 
procedures prescribed in the Federal Civil Penalties Inflation 
Adjustment Act of 1990, as amended:

------------------------------------------------------------------------
                      Date of violation                         Penalty
------------------------------------------------------------------------
Violation occurring between Sept. 29, 1999 and Nov. 2, 2015..    $11,000
Violation occurring after Nov. 2, 2015.......................     19,246
------------------------------------------------------------------------

    (b) The Attorney General may bring a civil action in any 
appropriate United States district court against any individual who 
negligently violates the provisions of Sec.  2634.408(d)(1) or (e)(1). 
The court in which the action is brought

[[Page 8133]]

may assess against the individual a civil monetary penalty in any 
amount, not to exceed the amounts set forth below, as provided by 
section 102(f)(6)(C)(ii) of the Act and as adjusted in accordance with 
the inflation adjustment procedures of the Federal Civil Penalties 
Inflation Adjustment Act of 1990, as amended:

------------------------------------------------------------------------
                      Date of violation                         Penalty
------------------------------------------------------------------------
Violation occurring between Sept. 29, 1999 and Nov. 2, 2015..     $5,500
Violation occurring after Nov. 2, 2015.......................      9,623
------------------------------------------------------------------------


0
4. Section 2634.703 is revised to read as follows:


Sec.  2634.703  Misuse of public reports.

    (a) The Attorney General may bring a civil action against any 
person who obtains or uses a report filed under this part for any 
purpose prohibited by section 105(c)(1) of the Act, as incorporated in 
Sec.  2634.603(f). The court in which the action is brought may assess 
against the person a civil monetary penalty in any amount, not to 
exceed the amounts set forth below, as provided by section 105(c)(2) of 
the Act and as adjusted in accordance with the inflation adjustment 
procedures prescribed in the Federal Civil Penalties Inflation 
Adjustment Act of 1990, as amended:

------------------------------------------------------------------------
                      Date of violation                         Penalty
------------------------------------------------------------------------
Violation occurring between Sept. 29, 1999 and Nov. 2, 2015..    $11,000
Violation occurring after Nov. 2, 2015.......................     19,246
------------------------------------------------------------------------

    (b) This remedy shall be in addition to any other remedy available 
under statutory or common law.

PART 2636--LIMITATIONS ON OUTSIDE EARNED INCOME, EMPLOYMENT AND 
AFFILIATIONS FOR CERTAIN NONCAREER EMPLOYEES

0
5. The authority citation for part 2636 continues to read as follows:

    Authority:  5 U.S.C. App. (Ethics in Government Act of 1978); 
Pub. L. 101-410, 104 Stat. 890, 28 U.S.C. 2461 note (Federal Civil 
Penalties Inflation Adjustment Act of 1990), as amended by Sec. 
31001, Pub. L. 104-134, 110 Stat. 1321 (Debt Collection Improvement 
Act of 1996) and Sec. 701, Pub. L. 114-74 (Federal Civil Penalties 
Inflation Adjustment Act Improvements Act of 2015); E.O. 12674, 54 
FR 15159, 3 CFR, 1989 Comp., p. 215, as modified by E.O. 12731, 55 
FR 42547, 3 CFR, 1990 Comp., p. 306.


0
6. Section 2636.104 is amended by revising paragraph (a) to read as 
follows:


Sec.  2636.104   Civil, disciplinary and other action.

    (a) Civil action. Except when the employee engages in conduct in 
good faith reliance upon an advisory opinion issued under Sec.  
2636.103, an employee who engages in any conduct in violation of the 
prohibitions, limitations and restrictions contained in this part may 
be subject to civil action under 5 U.S.C. app. 504(a) and a civil 
monetary penalty of not more than the amounts set forth below, as 
adjusted in accordance with the inflation adjustment procedures 
prescribed in the Federal Civil Penalties Inflation Adjustment Act of 
1990, as amended, or the amount of the compensation the individual 
received for the prohibited conduct, whichever is greater.

------------------------------------------------------------------------
                      Date of violation                         Penalty
------------------------------------------------------------------------
Violation occurring between Sept. 29, 1999 and Nov. 2, 2015..    $11,000
Violation occurring after Nov. 2, 2015.......................     19,246
------------------------------------------------------------------------

* * * * *
[FR Doc. 2017-00627 Filed 1-23-17; 8:45 am]
 BILLING CODE 6345-03-P