Rules of Practice and Procedure; Adjusting Civil Money Penalties for Inflation, 1293-1295 [2018-00336]
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Federal Register / Vol. 83, No. 8 / Thursday, January 11, 2018 / Rules and Regulations
and suppliers) that are indemnified by
the Price-Anderson Act, 42 U.S.C.
2210(d). See 10 CFR 851.5(a).
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PART 1013—PROGRAM FRAUD CIVIL
REMEDIES AND PROCEDURES
25. Section 1013.3 is amended by
revising paragraphs (a)(1)(iv) and
(b)(1)(ii) to read as follows:
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§ 1013.3 Basis for civil penalties and
assessments.
BILLING CODE 6450–01–P
PART 1017—IDENTIFICATION AND
PROTECTION OF UNCLASSIFIED
CONTROLLED NUCLEAR
INFORMATION
26. The authority citation for part
1017 continues to read as follows:
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Authority: 42 U.S.C. 7101 et seq.; 50 U.S.C.
2401 et seq.; 42 U.S.C. 2168; 28 U.S.C. 2461
note.
27. Section 1017.29 is amended by
revising paragraph (c) to read as follows:
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Civil penalty.
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(c) Amount of penalty. The Director
may propose imposition of a civil
penalty for violation of a requirement of
a regulation under paragraph (a) of this
section or a compliance order issued
under paragraph (b) of this section, not
to exceed $264,093 for each violation.
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28. The authority citation for part
1050 continues to read as follows:
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(d) * * * The court in which such
action is brought may assess a civil
penalty against such employee in any
amount not to exceed the retail value of
the gift improperly solicited or received
plus $20,021.
[FR Doc. 2018–00206 Filed 1–10–18; 8:45 am]
(a) * * *
(1) * * *
(iv) Is for payment for the provision
of property or services which the person
has not provided as claimed, shall be
subject, in addition to any other remedy
that may be prescribed by law, to a civil
penalty of not more than $11,181 for
each such claim.
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(b) * * *
(1) * * *
(ii) Contains or is accompanied by an
express certification or affirmation of
the truthfulness and accuracy of the
contents of the statement, shall be
subject, in addition to any other remedy
that may be prescribed by law, to a civil
penalty of not more than $11,181 for
each such statement.
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PART 1050—FOREIGN GIFTS AND
DECORATIONS
Enforcement.
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Authority: 31 U.S.C. 3801–3812; 28 U.S.C.
2461 note.
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29. Section 1050.303 is amended by
revising the last sentence in paragraph
(d) to read as follows:
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§ 1050.303
24. The authority citation for part
1013 continues to read as follows:
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§ 1017.29
Authority: The Constitution of the United
States, Article I, Section 9; 5 U.S.C. 7342; 22
U.S.C. 2694; 42 U.S.C. 7254 and 7262; 28
U.S.C. 2461 note.
FARM CREDIT ADMINISTRATION
12 CFR Part 622
RIN 3052–AD29
Rules of Practice and Procedure;
Adjusting Civil Money Penalties for
Inflation
Farm Credit Administration.
Final rule.
AGENCY:
ACTION:
This regulation implements
inflation adjustments to civil money
penalties (CMPs) that the Farm Credit
Administration (FCA) may impose or
enforce pursuant to the Farm Credit Act
of 1971, as amended (Farm Credit Act),
and pursuant to the Flood Disaster
Protection Act of 1973, as amended by
the National Flood Insurance Reform
Act of 1994 (Reform Act), and further
amended by the Biggert-Waters Flood
Insurance Reform Act of 2012 (BiggertWaters Act).
DATES: Effective date: This regulation is
effective on January 15, 2018.
FOR FURTHER INFORMATION CONTACT:
Michael T. Wilson, Policy Analyst,
Office of Regulatory Policy, (703) 883–
4124, TTY (703) 883–4056, wilsonm@
fca.gov, or Autumn R. Agans, AttorneyAdvisor, Office of General Counsel,
(703) 883–4082, TTY (703) 883–4056,
agansa@fca.gov.
SUPPLEMENTARY INFORMATION:
SUMMARY:
I. Objective
The objective of this regulation is to
adjust the maximum CMPs for inflation
through a final rulemaking to retain the
deterrent effect of such penalties.
II. Background
A. Introduction
The Federal Civil Penalties Inflation
Adjustment Act of 1990, as amended by
the Debt Collection Improvement Act of
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1293
1996 (1996 Act) and the Federal Civil
Penalties Inflation Adjustment Act
Improvements Act of 2015 (2015 Act)
(collectively, 1990 Act, as amended),
requires all Federal agencies with the
authority to enforce CMPs to evaluate
and adjust, if necessary, those CMPs
each year to ensure that they continue
to maintain their deterrent value and
promote compliance with the law.
Section 3(2) of the 1990 Act, as
amended, defines a civil monetary
penalty 1 as any penalty, fine, or other
sanction that: (1) Either is for a specific
monetary amount as provided by
Federal law or has a maximum amount
provided for by Federal law; (2) is
assessed or enforced by an agency
pursuant to Federal law; and (3) is
assessed or enforced pursuant to an
administrative proceeding or a civil
action in the Federal courts.2
The FCA imposes and enforces CMPs
through the Farm Credit Act 3 and the
Flood Disaster Protection Act of 1973, as
amended. FCA’s regulations governing
CMPs are found in 12 CFR parts 622 and
623. Part 622 establishes rules of
practice and procedure applicable to
formal and informal hearings held
before the FCA, and to formal
investigations conducted under the
Farm Credit Act. Part 623 prescribes
rules regarding persons who may
practice before the FCA and the
circumstances under which such
persons may be suspended or debarred
from practice before the FCA.
B. CMPs Issued Under the Farm Credit
Act
The Farm Credit Act provides that
any Farm Credit System (System)
institution or any officer, director,
employee, agent, or other person
participating in the conduct of the
affairs of a System institution who
violates the terms of a cease-and-desist
order that has become final pursuant to
section 5.25 or 5.26 of the Farm Credit
Act must pay up to a maximum daily
amount of $1,000 4 during which such
violation continues. This CMP
maximum was set by the Farm Credit
Amendments Act of 1985, which
amended the Farm Credit Act. Orders
1 Note: While the 1990 Act, as amended by 1996
and 2015 Acts, uses the term ‘‘civil monetary
penalties’’ for these penalties or other sanctions, the
Farm Credit Act and the FCA Regulations use the
term ‘‘civil money penalties.’’ Both terms have the
same meaning. Accordingly, this rule uses the term
civil money penalty, and both terms may be used
interchangeably.
2 See 28 U.S.C. 2461 note.
3 Public Law 92–181, as amended.
4 The inflation-adjusted CMP in effect on January
15, 2017, for a violation of a final order is $2,224
per day, as set forth in § 622.61(a)(1) of FCA
regulations.
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Federal Register / Vol. 83, No. 8 / Thursday, January 11, 2018 / Rules and Regulations
issued by the FCA under section 5.25 or
5.26 of the Farm Credit Act include
temporary and permanent cease-anddesist orders. In addition, section
5.32(h) of the Farm Credit Act provides
that any directive issued under sections
4.3(b)(2), 4.3A(e), or 4.14A(i) of the
Farm Credit Act ‘‘shall be treated’’ as a
final order issued under section 5.25 of
the Farm Credit Act for purposes of
assessing a CMP.
Section 5.32(a) of the Farm Credit Act
also states that ‘‘[a]ny such institution or
person who violates any provision of
the [Farm Credit] Act or any regulation
issued under this Act shall forfeit and
pay a civil penalty of not more than
$500 5 per day for each day during
which such violation continues.’’ This
CMP maximum was set by the
Agricultural Credit Act of 1987, which
was enacted in 1988, and amends the
Farm Credit Act. Current, inflationadjusted CMP maximums are set forth
in existing § 622.61 of FCA regulations.6
The FCA also enforces the Flood
Disaster Protection Act of 1973,7 as
amended by the National Flood
Insurance Reform Act of 1994,8 which
requires FCA to assess CMPs for a
pattern or practice of committing certain
specific actions in violation of the
National Flood Insurance Program. The
existing maximum CMP for a violation
under the Flood Disaster Protection Act
of 1973 is $2,000.9 10
C. Federal Civil Penalties Inflation
Adjustment Act Improvements Act of
2015
1. In General
The 2015 Act required all Federal
agencies to adjust the CMPs yearly,
starting January 15, 2017.
Under Section 4(b) of the 1990 Act, as
amended, annual adjustments are to be
made yearly no later than January 15 of
each year.11 Section 6 of the 1990 Act,
as amended, states that any increase to
a civil monetary penalty under this 1990
Act applies only to civil monetary
penalties, including those whose
associated violation predated such
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5 The
inflation-adjusted CMP in effect on January
15, 2017, for a violation of the Farm Credit Act or
a regulation issued under the Farm Credit Act is
$1,005 per day, as set forth in § 622.61(a)(2) of FCA
regulations.
6 Prior adjustments were made under the 1990
Act.
7 42 U.S.C. 4012a.
8 Public Law 103–325, title V, 108 Stat. 2160,
2255–87 (September 23, 1994).
9 Public Law 112–141, 126 Stat. 405 (July 6,
2012).
10 The inflation-adjusted CMP in effect on January
15, 2017, for a flood insurance violation is $2,090,
as set forth in § 622.61(b) of FCA regulations.
11 Public Law 114–74, sec. 701(b)(1).
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increase, which are assessed after the
date the increase takes effect.
Section 5(b) of the 1990 Act, as
amended, defines the term ‘‘cost-ofliving adjustment’’ as the percentage (if
any) for each civil monetary penalty by
which (1) the Consumer Price Index
(CPI) for the month of October of the
calendar year preceding the adjustment,
exceeds (2) the CPI for the month of
October 1 year before the month of
October referred to in (1) of the calendar
year in which the amount of such civil
monetary penalty was last set or
adjusted pursuant to law.12
The increase for each CMP adjusted
for inflation must be rounded using a
method prescribed by section 5(a) of the
1990 Act, as amended, by the 2015
Act.13
2. Other Adjustments
If a civil monetary penalty is subject
to a cost-of-living adjustment under the
1990 Act, as amended, but is adjusted
to an amount greater than the amount of
the adjustment required under the Act
within the 12 months preceding a
required cost-of-living adjustment, the
agency is not required to make the costof-living adjustment to that CMP in that
calendar year.14
III. Yearly Adjustments
A. Mathematical Calculations of 2018
Adjustments
The adjustment requirement affects
two provisions of section 5.32(a) of the
Farm Credit Act. For the 2018 yearly
adjustments to the CMPs set forth by the
Farm Credit Act, the calculation
required by the 2017 White House
Office of Management and Budget
(OMB) guidance 15 is based on the
percentage by which the CPI for October
2017 exceeds the CPIs for October 2016.
The OMB set forth guidance, as required
by the 2015 Act,16 with a multiplier for
calculating the new CMP values.17 The
OMB multiplier for the 2018 CMPs is
1.02041.
The adjustment also affects the CMPs
set by the Flood Disaster Protection Act
12 The CPI is published by the Department of
Labor, Bureau of Statistics, and is available at its
website: ftp://ftp.bls.gov/pub/special.requests/cpi/
cpiai.txt.
13 Pursuant to section 5(a)(3) of the 2015 Act, any
increase determined under the subsection shall be
rounded to the nearest $1.
14 Pursuant to section 4(d) of the 1990 Act, as
amended.
15 OMB Circular M–18–03, Implementation of
Penalty Inflation Adjustments for 2018, Pursuant to
the Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015.
16 28 U.S.C. 2461 note, section 7(a).
17 OMB Circular M–18–03, Implementation of
Penalty Inflation Adjustments for 2018, Pursuant to
the Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015.
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of 1973, as amended. The adjustment
multiplier is the same for all FCA
enforced CMPs, set at 1.02041. The
maximum CMPs for violations were
created in 2012 by the Biggert-Waters
Act, which amended the Flood Disaster
Protection Act of 1973.
1. New Penalty Amount in § 622.61(a)(1)
The inflation-adjusted CMP currently
in effect for violations of a final order
occurring on or after January 15, 2017,
is a maximum daily amount of $2,224.18
Multiplying the $2,224 CMP by the 2017
OMB multiplier, 1.02041, yields a total
of $2,269.39. When that number is
rounded as required by section 5(a) of
the 1990 Act, as amended, the inflationadjusted maximum increases to $2,269.
Thus, the new CMP maximum is $2,269.
2. New Penalty Amount in § 622.61(a)(2)
The inflation-adjusted CMP currently
in effect for violations of the Farm
Credit Act or regulations issued under
the Farm Credit Act occurring on or
after January 15, 2017, is a maximum
daily amount of $1,005.19 Multiplying
the $1,005 CMP maximum by the 2017
OMB multiplier, 1.02041, yields a total
of $1,025.51. When that number is
rounded as required by section 5(a) of
the 1990 Act, as amended the inflationadjusted maximum increases to $1,026.
Thus, the new CMP maximum is $1,026.
3. New Penalty Amounts for Flood
Insurance Violations Under § 622.61(b)
The existing maximum CMP for a
pattern or practice of flood insurance
violations pursuant to 42 U.S.C.
4012a(f)(5) is $2,090. Multiplying
$2,090 by the 2017 OMB multiplier,
1.02041, yields a total of $2,132.65.
When that number is rounded as
required by section 5(a) of the 1990 Act,
as amended, the new maximum
assessment of the CMP for violating 42
U.S.C. 4012a(f)(5) is $2,133. Thus, the
new CMP maximum is $2,133.
IV. Notice and Comment Not Required
by Administrative Procedure Act
The 1990 Act, as amended, gives
Federal agencies no discretion in the
adjustment of CMPs for the rate of
inflation. Further, these revisions are
ministerial, technical, and
noncontroversial. For these reasons, the
FCA finds good cause to determine that
public notice and an opportunity to
comment are impracticable,
unnecessary, and contrary to the public
interest pursuant to the Administrative
Procedure Act, 5 U.S.C. 553(b)(B), and
adopts this rule in final form.
18 12
19 12
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CFR 622.61(a)(1).
CFR 622.61(a)(2).
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Federal Register / Vol. 83, No. 8 / Thursday, January 11, 2018 / Rules and Regulations
V. Regulatory Flexibility Act
Pursuant to section 605(b) of the
Regulatory Flexibility Act (5 U.S.C. 601
et seq.), the FCA hereby certifies that
this final rule will not have a significant
economic impact on a substantial
number of small entities. Each of the
banks in the System, considered
together with its affiliated associations,
has assets and annual income in excess
of the amounts that would qualify them
as small entities. Therefore, System
institutions are not ‘‘small entities’’ as
defined in the Regulatory Flexibility
Act.
List of Subjects in 12 CFR Part 622
Administrative practice and
procedure, Crime, Investigations,
Penalties.
For the reasons stated in the
preamble, part 622 of chapter VI, title 12
of the Code of Federal Regulations is
amended as follows:
PART 622—RULES OF PRACTICE AND
PROCEDURE
1. The authority citation for part 622
continues to read as follows:
(2) Amount of civil money penalty for
violation of the Act or regulations: The
maximum daily amount is $1,026 for
each violation that occurs on or after
January 15, 2018.
(b) The maximum civil money penalty
amount assessed under 42 U.S.C.
4012a(f) is: $385 for each violation that
occurs on or after January 16, 2009, but
before July 1, 2013, with total penalties
under such statute not to exceed
$120,000 for any single institution
during any calendar year; $2,000 for
each violation that occurs on or after
July 1, 2013, but before August 1, 2016,
with no cap on the total amount of
penalties that can be assessed against
any single institution during any
calendar year; and $2,133 for each
violation that occurs on or after January
15, 2018, with no cap on the total
amount of penalties that can be assessed
against any single institution during any
calendar year.
Dated: January 8, 2018.
Dale L. Aultman,
Secretary, Farm Credit Administration Board.
[FR Doc. 2018–00336 Filed 1–10–18; 8:45 am]
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SECURITIES AND EXCHANGE
COMMISSION
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2. Revise § 622.61 to read as follows:
(a) The maximum amount of each
civil money penalty within FCA’s
jurisdiction is adjusted in accordance
with the Federal Civil Penalties
Inflation Adjustment Act of 1990, as
amended (28 U.S.C. 2461 note), as
follows:
(1) Amount of civil money penalty
imposed under section 5.32 of the Act
for violation of a final order issued
under section 5.25 or 5.26 of the Act:
The maximum daily amount is $2,269
for violations that occur on or after
January 15, 2018.
Staff Accounting Bulletin No. 117
Securities and Exchange
Commission.
ACTION: Publication of Staff Accounting
Bulletin.
AGENCY:
This staff accounting bulletin
modifies portions of the interpretive
guidance included in the Staff
Accounting Bulletin Series in order to
make the relevant interpretive guidance
consistent with authoritative accounting
guidance and Securities and Exchange
Commission rules and regulations.
Specifically, the staff is updating the
Series in order to bring existing
guidance into conformity with the
SUMMARY:
Release No.
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Publication of Staff Accounting Bulletin No. 117 ..........
Note: The text of SAB 117 will not appear
in the Code of Federal Regulations.
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PART 211—INTERPRETATIONS
RELATING TO FINANCIAL REPORTING
MATTERS
1. Add an authority citation for part
211 to read as follows:
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Authority: 15 U.S.C. 77g, 15 U.S.C. 77s(a),
15 U.S.C. 77aa(25) and (26), 15 U.S.C. 78c(b),
17 CFR 78l(b) and 13(b), 17 CFR 78m(b) and
15 U.S.C. 80a–8, 30(e) 15 U.S.C. 80a–29(e),
15 U.S.C. 80a–30, and 15 U.S.C. 80a–37(a).
2. Amend the table in subpart B by
adding an entry for Staff Accounting
Bulletin No. 117 at the end of the table
to read as follows:
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Subpart B—Staff Accounting Bulletins
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[INSERT Federal Register CITATION].
This staff accounting bulletin
modifies portions of the interpretive
guidance included in the Staff
Accounting Bulletin Series in order to
Frm 00007
List of Subjects in 17 CFR Part 211
Fed. Reg. Vol. and page
Staff Accounting Bulletin No. 117
PO 00000
Brian Staniszewski, Professional
Accounting Fellow, Office of the Chief
Accountant at (202) 551–5300 or
Lindsay McCord, Associate Chief
Accountant, Division of Corporation
Finance at (202) 551–3400, Securities
and Exchange Commission, 100 F Street
NE, Washington, DC 20549.
SUPPLEMENTARY INFORMATION: The
statements in staff accounting bulletins
are not rules or interpretations of the
Commission, nor are they published as
bearing the Commission’s official
approval. They represent interpretations
and practices followed by the Division
of Corporation Finance and the Office of
the Chief Accountant in administering
the disclosure requirements of the
federal securities laws.
Date
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SAB–117
FOR FURTHER INFORMATION CONTACT:
Accordingly, part 211 of title 17 of the
Code of Federal Regulations is amended
as follows:
17 CFR Part 211
Subject
Effective: January 11, 2018.
Dated: November 29, 2017.
Brent J. Fields,
Secretary.
[Release No. SAB 117]
§ 622.61 Adjustment of civil money
penalties by the rate of inflation under the
Federal Civil Penalties Inflation Adjustment
Act of 1990, as amended.
DATES:
Accounting, Reporting and
recordkeeping requirements, Securities.
BILLING CODE 6705–01–P
Authority: Secs. 5.9, 5.10, 5.17, 5.25–5.37
of the Farm Credit Act (12 U.S.C. 2243, 2244,
2252, 2261–2273); 28 U.S.C. 2461 note; and
42 U.S.C. 4012a(f).
Financial Accounting Standards Board
Accounting Standards Codification
Topic 321, Investments—Equity
Securities.
Sfmt 4700
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make the relevant interpretive guidance
consistent with current authoritative
accounting and auditing guidance and
Securities and Exchange Commission
(‘‘Commission’’) rules and regulations.
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[Federal Register Volume 83, Number 8 (Thursday, January 11, 2018)]
[Rules and Regulations]
[Pages 1293-1295]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-00336]
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FARM CREDIT ADMINISTRATION
12 CFR Part 622
RIN 3052-AD29
Rules of Practice and Procedure; Adjusting Civil Money Penalties
for Inflation
AGENCY: Farm Credit Administration.
ACTION: Final rule.
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SUMMARY: This regulation implements inflation adjustments to civil
money penalties (CMPs) that the Farm Credit Administration (FCA) may
impose or enforce pursuant to the Farm Credit Act of 1971, as amended
(Farm Credit Act), and pursuant to the Flood Disaster Protection Act of
1973, as amended by the National Flood Insurance Reform Act of 1994
(Reform Act), and further amended by the Biggert-Waters Flood Insurance
Reform Act of 2012 (Biggert-Waters Act).
DATES: Effective date: This regulation is effective on January 15,
2018.
FOR FURTHER INFORMATION CONTACT: Michael T. Wilson, Policy Analyst,
Office of Regulatory Policy, (703) 883-4124, TTY (703) 883-4056,
[email protected], or Autumn R. Agans, Attorney-Advisor, Office of
General Counsel, (703) 883-4082, TTY (703) 883-4056, [email protected].
SUPPLEMENTARY INFORMATION:
I. Objective
The objective of this regulation is to adjust the maximum CMPs for
inflation through a final rulemaking to retain the deterrent effect of
such penalties.
II. Background
A. Introduction
The Federal Civil Penalties Inflation Adjustment Act of 1990, as
amended by the Debt Collection Improvement Act of 1996 (1996 Act) and
the Federal Civil Penalties Inflation Adjustment Act Improvements Act
of 2015 (2015 Act) (collectively, 1990 Act, as amended), requires all
Federal agencies with the authority to enforce CMPs to evaluate and
adjust, if necessary, those CMPs each year to ensure that they continue
to maintain their deterrent value and promote compliance with the law.
Section 3(2) of the 1990 Act, as amended, defines a civil monetary
penalty \1\ as any penalty, fine, or other sanction that: (1) Either is
for a specific monetary amount as provided by Federal law or has a
maximum amount provided for by Federal law; (2) is assessed or enforced
by an agency pursuant to Federal law; and (3) is assessed or enforced
pursuant to an administrative proceeding or a civil action in the
Federal courts.\2\
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\1\ Note: While the 1990 Act, as amended by 1996 and 2015 Acts,
uses the term ``civil monetary penalties'' for these penalties or
other sanctions, the Farm Credit Act and the FCA Regulations use the
term ``civil money penalties.'' Both terms have the same meaning.
Accordingly, this rule uses the term civil money penalty, and both
terms may be used interchangeably.
\2\ See 28 U.S.C. 2461 note.
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The FCA imposes and enforces CMPs through the Farm Credit Act \3\
and the Flood Disaster Protection Act of 1973, as amended. FCA's
regulations governing CMPs are found in 12 CFR parts 622 and 623. Part
622 establishes rules of practice and procedure applicable to formal
and informal hearings held before the FCA, and to formal investigations
conducted under the Farm Credit Act. Part 623 prescribes rules
regarding persons who may practice before the FCA and the circumstances
under which such persons may be suspended or debarred from practice
before the FCA.
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\3\ Public Law 92-181, as amended.
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B. CMPs Issued Under the Farm Credit Act
The Farm Credit Act provides that any Farm Credit System (System)
institution or any officer, director, employee, agent, or other person
participating in the conduct of the affairs of a System institution who
violates the terms of a cease-and-desist order that has become final
pursuant to section 5.25 or 5.26 of the Farm Credit Act must pay up to
a maximum daily amount of $1,000 \4\ during which such violation
continues. This CMP maximum was set by the Farm Credit Amendments Act
of 1985, which amended the Farm Credit Act. Orders
[[Page 1294]]
issued by the FCA under section 5.25 or 5.26 of the Farm Credit Act
include temporary and permanent cease-and-desist orders. In addition,
section 5.32(h) of the Farm Credit Act provides that any directive
issued under sections 4.3(b)(2), 4.3A(e), or 4.14A(i) of the Farm
Credit Act ``shall be treated'' as a final order issued under section
5.25 of the Farm Credit Act for purposes of assessing a CMP.
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\4\ The inflation-adjusted CMP in effect on January 15, 2017,
for a violation of a final order is $2,224 per day, as set forth in
Sec. 622.61(a)(1) of FCA regulations.
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Section 5.32(a) of the Farm Credit Act also states that ``[a]ny
such institution or person who violates any provision of the [Farm
Credit] Act or any regulation issued under this Act shall forfeit and
pay a civil penalty of not more than $500 \5\ per day for each day
during which such violation continues.'' This CMP maximum was set by
the Agricultural Credit Act of 1987, which was enacted in 1988, and
amends the Farm Credit Act. Current, inflation-adjusted CMP maximums
are set forth in existing Sec. 622.61 of FCA regulations.\6\
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\5\ The inflation-adjusted CMP in effect on January 15, 2017,
for a violation of the Farm Credit Act or a regulation issued under
the Farm Credit Act is $1,005 per day, as set forth in Sec.
622.61(a)(2) of FCA regulations.
\6\ Prior adjustments were made under the 1990 Act.
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The FCA also enforces the Flood Disaster Protection Act of 1973,\7\
as amended by the National Flood Insurance Reform Act of 1994,\8\ which
requires FCA to assess CMPs for a pattern or practice of committing
certain specific actions in violation of the National Flood Insurance
Program. The existing maximum CMP for a violation under the Flood
Disaster Protection Act of 1973 is $2,000.9 10
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\7\ 42 U.S.C. 4012a.
\8\ Public Law 103-325, title V, 108 Stat. 2160, 2255-87
(September 23, 1994).
\9\ Public Law 112-141, 126 Stat. 405 (July 6, 2012).
\10\ The inflation-adjusted CMP in effect on January 15, 2017,
for a flood insurance violation is $2,090, as set forth in Sec.
622.61(b) of FCA regulations.
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C. Federal Civil Penalties Inflation Adjustment Act Improvements Act of
2015
1. In General
The 2015 Act required all Federal agencies to adjust the CMPs
yearly, starting January 15, 2017.
Under Section 4(b) of the 1990 Act, as amended, annual adjustments
are to be made yearly no later than January 15 of each year.\11\
Section 6 of the 1990 Act, as amended, states that any increase to a
civil monetary penalty under this 1990 Act applies only to civil
monetary penalties, including those whose associated violation predated
such increase, which are assessed after the date the increase takes
effect.
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\11\ Public Law 114-74, sec. 701(b)(1).
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Section 5(b) of the 1990 Act, as amended, defines the term ``cost-
of-living adjustment'' as the percentage (if any) for each civil
monetary penalty by which (1) the Consumer Price Index (CPI) for the
month of October of the calendar year preceding the adjustment, exceeds
(2) the CPI for the month of October 1 year before the month of October
referred to in (1) of the calendar year in which the amount of such
civil monetary penalty was last set or adjusted pursuant to law.\12\
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\12\ The CPI is published by the Department of Labor, Bureau of
Statistics, and is available at its website: ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt.
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The increase for each CMP adjusted for inflation must be rounded
using a method prescribed by section 5(a) of the 1990 Act, as amended,
by the 2015 Act.\13\
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\13\ Pursuant to section 5(a)(3) of the 2015 Act, any increase
determined under the subsection shall be rounded to the nearest $1.
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2. Other Adjustments
If a civil monetary penalty is subject to a cost-of-living
adjustment under the 1990 Act, as amended, but is adjusted to an amount
greater than the amount of the adjustment required under the Act within
the 12 months preceding a required cost-of-living adjustment, the
agency is not required to make the cost-of-living adjustment to that
CMP in that calendar year.\14\
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\14\ Pursuant to section 4(d) of the 1990 Act, as amended.
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III. Yearly Adjustments
A. Mathematical Calculations of 2018 Adjustments
The adjustment requirement affects two provisions of section
5.32(a) of the Farm Credit Act. For the 2018 yearly adjustments to the
CMPs set forth by the Farm Credit Act, the calculation required by the
2017 White House Office of Management and Budget (OMB) guidance \15\ is
based on the percentage by which the CPI for October 2017 exceeds the
CPIs for October 2016. The OMB set forth guidance, as required by the
2015 Act,\16\ with a multiplier for calculating the new CMP values.\17\
The OMB multiplier for the 2018 CMPs is 1.02041.
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\15\ OMB Circular M-18-03, Implementation of Penalty Inflation
Adjustments for 2018, Pursuant to the Federal Civil Penalties
Inflation Adjustment Act Improvements Act of 2015.
\16\ 28 U.S.C. 2461 note, section 7(a).
\17\ OMB Circular M-18-03, Implementation of Penalty Inflation
Adjustments for 2018, Pursuant to the Federal Civil Penalties
Inflation Adjustment Act Improvements Act of 2015.
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The adjustment also affects the CMPs set by the Flood Disaster
Protection Act of 1973, as amended. The adjustment multiplier is the
same for all FCA enforced CMPs, set at 1.02041. The maximum CMPs for
violations were created in 2012 by the Biggert-Waters Act, which
amended the Flood Disaster Protection Act of 1973.
1. New Penalty Amount in Sec. 622.61(a)(1)
The inflation-adjusted CMP currently in effect for violations of a
final order occurring on or after January 15, 2017, is a maximum daily
amount of $2,224.\18\ Multiplying the $2,224 CMP by the 2017 OMB
multiplier, 1.02041, yields a total of $2,269.39. When that number is
rounded as required by section 5(a) of the 1990 Act, as amended, the
inflation-adjusted maximum increases to $2,269. Thus, the new CMP
maximum is $2,269.
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\18\ 12 CFR 622.61(a)(1).
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2. New Penalty Amount in Sec. 622.61(a)(2)
The inflation-adjusted CMP currently in effect for violations of
the Farm Credit Act or regulations issued under the Farm Credit Act
occurring on or after January 15, 2017, is a maximum daily amount of
$1,005.\19\ Multiplying the $1,005 CMP maximum by the 2017 OMB
multiplier, 1.02041, yields a total of $1,025.51. When that number is
rounded as required by section 5(a) of the 1990 Act, as amended the
inflation-adjusted maximum increases to $1,026. Thus, the new CMP
maximum is $1,026.
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\19\ 12 CFR 622.61(a)(2).
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3. New Penalty Amounts for Flood Insurance Violations Under Sec.
622.61(b)
The existing maximum CMP for a pattern or practice of flood
insurance violations pursuant to 42 U.S.C. 4012a(f)(5) is $2,090.
Multiplying $2,090 by the 2017 OMB multiplier, 1.02041, yields a total
of $2,132.65. When that number is rounded as required by section 5(a)
of the 1990 Act, as amended, the new maximum assessment of the CMP for
violating 42 U.S.C. 4012a(f)(5) is $2,133. Thus, the new CMP maximum is
$2,133.
IV. Notice and Comment Not Required by Administrative Procedure Act
The 1990 Act, as amended, gives Federal agencies no discretion in
the adjustment of CMPs for the rate of inflation. Further, these
revisions are ministerial, technical, and noncontroversial. For these
reasons, the FCA finds good cause to determine that public notice and
an opportunity to comment are impracticable, unnecessary, and contrary
to the public interest pursuant to the Administrative Procedure Act, 5
U.S.C. 553(b)(B), and adopts this rule in final form.
[[Page 1295]]
V. Regulatory Flexibility Act
Pursuant to section 605(b) of the Regulatory Flexibility Act (5
U.S.C. 601 et seq.), the FCA hereby certifies that this final rule will
not have a significant economic impact on a substantial number of small
entities. Each of the banks in the System, considered together with its
affiliated associations, has assets and annual income in excess of the
amounts that would qualify them as small entities. Therefore, System
institutions are not ``small entities'' as defined in the Regulatory
Flexibility Act.
List of Subjects in 12 CFR Part 622
Administrative practice and procedure, Crime, Investigations,
Penalties.
For the reasons stated in the preamble, part 622 of chapter VI,
title 12 of the Code of Federal Regulations is amended as follows:
PART 622--RULES OF PRACTICE AND PROCEDURE
0
1. The authority citation for part 622 continues to read as follows:
Authority: Secs. 5.9, 5.10, 5.17, 5.25-5.37 of the Farm Credit
Act (12 U.S.C. 2243, 2244, 2252, 2261-2273); 28 U.S.C. 2461 note;
and 42 U.S.C. 4012a(f).
0
2. Revise Sec. 622.61 to read as follows:
Sec. 622.61 Adjustment of civil money penalties by the rate of
inflation under the Federal Civil Penalties Inflation Adjustment Act of
1990, as amended.
(a) The maximum amount of each civil money penalty within FCA's
jurisdiction is adjusted in accordance with the Federal Civil Penalties
Inflation Adjustment Act of 1990, as amended (28 U.S.C. 2461 note), as
follows:
(1) Amount of civil money penalty imposed under section 5.32 of the
Act for violation of a final order issued under section 5.25 or 5.26 of
the Act: The maximum daily amount is $2,269 for violations that occur
on or after January 15, 2018.
(2) Amount of civil money penalty for violation of the Act or
regulations: The maximum daily amount is $1,026 for each violation that
occurs on or after January 15, 2018.
(b) The maximum civil money penalty amount assessed under 42 U.S.C.
4012a(f) is: $385 for each violation that occurs on or after January
16, 2009, but before July 1, 2013, with total penalties under such
statute not to exceed $120,000 for any single institution during any
calendar year; $2,000 for each violation that occurs on or after July
1, 2013, but before August 1, 2016, with no cap on the total amount of
penalties that can be assessed against any single institution during
any calendar year; and $2,133 for each violation that occurs on or
after January 15, 2018, with no cap on the total amount of penalties
that can be assessed against any single institution during any calendar
year.
Dated: January 8, 2018.
Dale L. Aultman,
Secretary, Farm Credit Administration Board.
[FR Doc. 2018-00336 Filed 1-10-18; 8:45 am]
BILLING CODE 6705-01-P
