Civil Penalty Inflation Adjustments, 2012-2014 [2020-00364]
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2012
Federal Register / Vol. 85, No. 9 / Tuesday, January 14, 2020 / Rules and Regulations
U.S. code citation
CMP description
(5) 12 U.S.C. 1782(d)(2)(B) ............
Tier 2 CMP for non-inadvertent failure to submit certified statement or
submission of false or misleading statement.
Tier 3 CMP for failure to submit a certified statement or the submission of a false or misleading statement done knowingly or with
reckless disregard.
Non-compliance with insurance logo requirements ..............................
Non-compliance with NCUA security requirements ..............................
Tier 1 CMP for violations of law, regulation, and other orders or
agreements.
Tier 2 CMP for violations of law, regulation, and other orders or
agreements and for recklessly engaging in unsafe or unsound
practices or breaches of fiduciary duty.
Tier 3 CMP for knowingly committing the violations under Tier 1 or 2
(natural person).
Tier 3 CMP for knowingly committing the violations under Tier 1 or 2
(insured credit union).
(6) 12 U.S.C. 1782(d)(2)(C) ............
(7) 12 U.S.C. 1785(a)(3) .................
(8) 12 U.S.C. 1785(e) (3) ................
(9) 12 U.S.C. 1786(k)(2)(A) ............
(10) 12 U.S.C. 1786(k)(2)(A) ..........
(11) 12 U.S.C. 1786(k)(2)(A) ..........
(12) 12 U.S.C. 1786(k)(2)(A) ..........
(13) 12 U.S.C. 1786(w)(5)(ii) ..........
(14) 15 U.S.C. 1639e(k) ..................
Non-compliance with senior examiner post-employment restrictions ...
Non-compliance with appraisal independence requirements ................
(15) 42 U.S.C. 4012a(f)(5) ..............
Non-compliance with flood insurance requirements .............................
(b) The adjusted amounts displayed in
paragraph (a) of this section apply to
civil monetary penalties that are
assessed after the date the increase takes
effect, including those whose associated
violation or violations pre-dated the
increase and occurred on or after
November 2, 2015.
[FR Doc. 2020–00309 Filed 1–13–20; 8:45 am]
BILLING CODE 7535–01–P
BUREAU OF CONSUMER FINANCIAL
PROTECTION
12 CFR Part 1083
Civil Penalty Inflation Adjustments
Bureau of Consumer Financial
Protection.
ACTION: Final rule.
AGENCY:
The Bureau of Consumer
Financial Protection (Bureau) is
adjusting for inflation the maximum
amount of each civil penalty within the
Bureau’s jurisdiction. These
adjustments are required by the Federal
Civil Penalties Inflation Adjustment Act
of 1990, as amended by the Debt
Collection Improvement Act of 1996
and further amended by the Federal
Civil Penalties Inflation Adjustment Act
Improvements Act of 2015 (Inflation
Adjustment Act). The inflation
adjustments mandated by the Inflation
Adjustment Act serve to maintain the
deterrent effect of civil penalties and to
promote compliance with the law.
DATES: This final rule is effective
January 15, 2020.
FOR FURTHER INFORMATION CONTACT:
Rachel Ross, Attorney-Advisor; Kristen
Phinnessee, Senior Counsel, Office of
Regulations, at (202) 435–7700. If you
SUMMARY:
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New maximum amount
VerDate Sep<11>2014
16:28 Jan 13, 2020
Jkt 250001
require this document in an alternative
electronic format, please contact CFPB_
Accessibility@cfpb.gov.
SUPPLEMENTARY INFORMATION:
I. Background
The Federal Civil Penalties Inflation
Adjustment Act of 1990,1 as amended
by the Debt Collection Improvement Act
of 1996 2 and further amended by the
Federal Civil Penalties Inflation
Adjustment Act Improvements Act of
2015 (Inflation Adjustment Act),3
directs Federal agencies to adjust for
inflation the civil penalty amounts
within their jurisdiction not later than
July 1, 2016, and then not later than
January 15 every year thereafter.4 Each
agency was required to make the 2016
one-time catch-up adjustments through
an interim final rule published in the
Federal Register. On June 14, 2016, the
Bureau published its interim final rule
(IFR) to make the initial catch-up
adjustments to civil penalties within the
Bureau’s jurisdiction.5 The June 2016
IFR created a new part 1083 and in
§ 1083.1 established the inflationadjusted maximum amounts for each
civil penalty within the Bureau’s
1 Public
Law 101–410, 104 Stat. 890.
Law 104–134, section 31001(s)(1), 110
Stat. 1321, 1321–373.
3 Public Law 114–74, section 701, 129 Stat. 584,
599.
4 Section 1301(a) of the Federal Reports
Elimination Act of 1998, Public Law 105–362, 112
Stat. 3293, also amended the Inflation Adjustment
Act by striking section 6, which contained annual
reporting requirements, and redesignating section 7
as section 6, but did not alter the civil penalty
adjustment requirements; 28 U.S.C. 2461 note.
5 81 FR 38569 (June 14, 2016). Although the
Bureau was not obligated to solicit comments for
the interim final rule, the Bureau invited public
comment and received none.
2 Public
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$37,458.
$1,872,957 or 1 percent of the
total assets of the credit union,
whichever is less.
$127.
$297.
$10,245.
$51,222.
$2,048,915.
$2,048,915 or 1 percent of the
total assets of the credit union,
whichever is less.
$337,016.
First violation: $11,767.
Subsequent violations: $23,533.
$2,226.
jurisdiction.6 The Bureau finalized the
IFR on January 31, 2019.7
The Inflation Adjustment Act also
requires subsequent adjustments to be
made annually, not later than January
15, and notwithstanding section 553 of
the Administrative Procedure Act
(APA).8 The Bureau annually adjusted
its civil penalty amounts, as required by
the Act, through rules issued in January
2017, January 2018, and January 2019.9
Specifically, the Act directs Federal
agencies to adjust annually each civil
penalty provided by law within the
jurisdiction of the agency by the ‘‘costof-living adjustment.’’ 10 The ‘‘cost-ofliving adjustment’’ is defined as the
percentage (if any) by which the
Consumer Price Index for all-urban
consumers (CPI–U) for the month of
October preceding the date of the
adjustment, exceeds the CPI–U for
October of the prior year.11 The Director
of the Office of Management and Budget
(OMB) is required to issue guidance
(OMB Guidance) every year by
6 See
12 CFR 1083.1.
FR 517 (Jan. 31, 2019).
8 Inflation Adjustment Act section 4, codified at
28 U.S.C. 2461 note. As discussed in guidance
issued by the Director of the Office of Management
and Budget (OMB), the APA generally requires
notice, an opportunity for comment, and a delay in
effective date for certain rulemakings, but the
Inflation Adjustment Act provides that these
procedures are not required for agencies to issue
regulations implementing the annual adjustment.
See Memorandum to the Exec. Dep’ts & Agencies
from Russell T. Vought, Acting Director, Office of
Mgmt. & Budget at 4 (Dec. 16, 2019), available at
https://www.whitehouse.gov/wp-content/uploads/
2019/12/M-20-05.pdf.
9 82 FR 3601 (Jan. 12, 2017); 83 FR 1525 (Jan. 12,
2018); 84 FR 517 (Jan. 31, 2019).
10 Inflation Adjustment Act sections 4 and 5,
codified at 28 U.S.C. 2461 note.
11 Inflation Adjustment Act sections 3 and 5,
codified at 28 U.S.C. 2461 note.
7 84
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Federal Register / Vol. 85, No. 9 / Tuesday, January 14, 2020 / Rules and Regulations
December 15 to agencies on
implementing the annual civil penalty
inflation adjustments. Pursuant to the
Inflation Adjustment Act and OMB
Guidance, agencies must apply the
multiplier reflecting the ‘‘cost-of-living
adjustment’’ to the current penalty
amount and then round that amount to
the nearest dollar to determine the
annual adjustments.12 The adjustments
II. Adjustment
Pursuant to the Inflation Adjustment
Act and OMB Guidance, the Bureau
multiplied each of its civil penalty
amounts by the ‘‘cost-of-living
adjustment’’ multiplier and rounded to
the nearest dollar.15 The new penalty
amounts that apply to civil penalties
assessed after January 15, 2020, are as
follows:
Penalty
amounts
established
under 2019
final rule
OMB ‘‘cost-ofliving
adjustment’’
multiplier
Law
Penalty
description
Consumer Financial Protection Act, 12 U.S.C. 5565(c)(2)(A)
Consumer Financial Protection Act, 12 U.S.C. 5565(c)(2)(B)
Consumer Financial Protection Act, 12 U.S.C. 5565(c)(2)(C)
Interstate Land Sales Full Disclosure Act, 15 U.S.C.
1717a(a)(2).
Interstate Land Sales Full Disclosure Act, 15 U.S.C.
1717a(a)(2).
Real Estate Settlement Procedures Act, 12 U.S.C.
2609(d)(1).
Real Estate Settlement Procedures Act, 12 U.S.C.
2609(d)(1).
Real Estate Settlement Procedures Act, 12 U.S.C.
2609(d)(2)(A).
SAFE Act, 12 U.S.C. 5113(d)(2) .............................................
Truth in Lending Act, 15 U.S.C. 1639e(k)(1) ..........................
Truth in Lending Act, 15 U.S.C. 1639e(k)(2) ..........................
Tier 1 penalty .........................
Tier 2 penalty .........................
Tier 3 penalty .........................
Per violation ...........................
$5,781
28,906
1,156,242
2,014
1.01764
1.01764
1.01764
1.01764
$5,883
29,416
1,176,638
2,050
Annual cap .............................
2,013,399
1.01764
2,048,915
Per failure ..............................
94
1.01764
96
Annual cap .............................
189,427
1.01764
192,768
190
1.01764
193
29,192
11,563
23,125
1.01764
1.01764
1.01764
29,707
11,767
23,533
Per failure, where intentional
Per violation ...........................
First violation ..........................
Subsequent violations ............
New penalty
amount
Under the Administrative Procedure
Act, notice and opportunity for public
comment are not required if the Bureau
finds that notice and public comment
are impracticable, unnecessary, or
contrary to the public interest.16 The
adjustments to the civil penalty
amounts are technical and nondiscretionary, and they merely apply the
statutory method for adjusting civil
penalty amounts. These adjustments are
required by the Inflation Adjustment
Act. Moreover, the Inflation Adjustment
Act directs agencies to adjust civil
penalties annually notwithstanding
section 553 of the APA,17 and OMB
Guidance reaffirms that agencies need
not complete a notice-and-comment
process before making the annual
adjustments for inflation.18 For these
reasons, the Bureau has determined that
publishing a notice of proposed
rulemaking and providing opportunity
for public comment are unnecessary.
The amendments therefore are adopted
in final form.
Section 553(d) of the APA generally
requires publication of a final rule not
less than 30 days before its effective
date, except (1) a substantive rule which
grants or recognizes an exemption or
relieves a restriction; (2) interpretive
rules and statements of policy; or (3) as
otherwise provided by the agency for
good cause found and published with
the rule.19 At minimum, the Bureau
believes the annual adjustments to the
civil penalty amounts in § 1083.1(a) fall
under the third exception to section
553(d). The Bureau finds that there is
good cause to make the amendments
effective on January 15, 2020. The
amendments to § 1083.1(a) in this final
rule are technical and nondiscretionary, and they merely apply the
statutory method for adjusting civil
penalty amounts and follow the
statutory directive to make annual
adjustments each year. Moreover, the
Inflation Adjustment Act directs
agencies to adjust the civil penalties
annually notwithstanding section 553 of
the APA,20 and OMB Guidance
reaffirms that agencies need not provide
a delay in effective date for the annual
adjustments for inflation.21
12 Inflation Adjustment Act section 5, codified at
28 U.S.C. 2461 note; see also Memorandum to the
Exec. Dep’ts & Agencies from Russell T. Vought,
Acting Director, Office of Mgmt. & Budget (Dec. 16,
2019), available at https://www.whitehouse.gov/wpcontent/uploads/2019/12/M-20-05.pdf.
13 See Inflation Adjustment Act section 2,
codified at 28 U.S.C. 2461 note.
14 Memorandum to the Exec. Dep’ts & Agencies
from Russell T. Vought, Acting Director, Office of
Mgmt. & Budget (Dec. 16, 2019), available at https://
www.whitehouse.gov/wp-content/uploads/2019/12/
M-20-05.pdf.
15 Inflation Adjustment Act section 4, codified at
28 U.S.C. 2461 note.
16 5 U.S.C. 553(b)(B).
17 Inflation Adjustment Act section 4, codified at
28 U.S.C. 2461 note.
18 Memorandum to the Exec. Dep’ts & Agencies
from Russell T. Vought, Acting Director, Office of
Mgmt. & Budget (Dec. 16, 2019), available at https://
www.whitehouse.gov/wp-content/uploads/2019/12/
M-20-05.pdf.
19 5 U.S.C. 553(d).
20 Inflation Adjustment Act section 4, codified at
28 U.S.C. 2461 note.
21 Memorandum to the Exec. Dep’ts & Agencies
from Russell T. Vought, Acting Director, Office of
Mgmt. & Budget (Dec. 16, 2019), available at https://
www.whitehouse.gov/wp-content/uploads/2019/12/
M-20-05.pdf.
22 5 U.S.C. 603(a), 604(a).
III. Procedural Requirements
A. Administrative Procedure Act
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are designed to keep pace with inflation
so that civil penalties retain their
deterrent effect and promote compliance
with the law.13
For the 2020 annual adjustment, the
multiplier reflecting the ‘‘cost-of-living
adjustment’’ is 1.01764.14
2013
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B. Regulatory Flexibility Act
Because no notice of proposed
rulemaking is required, the Regulatory
Flexibility Act does not require an
initial or final regulatory flexibility
analysis.22
C. Paperwork Reduction Act
The Bureau has determined that this
final rule does not impose any new or
revise any existing recordkeeping,
reporting, or disclosure requirements on
covered entities or members of the
public that would be collections of
information requiring approval by the
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2014
Federal Register / Vol. 85, No. 9 / Tuesday, January 14, 2020 / Rules and Regulations
Office of Management and Budget under
the Paperwork Reduction Act.23
D. Congressional Review Act
Pursuant to the Congressional Review
Act (5 U.S.C. 801 et seq.), the Bureau
will submit a report containing this rule
and other required information to the
United States Senate, the United States
House of Representatives, and the
Comptroller General of the United
States prior to the rule taking effect. The
Office of Information and Regulatory
Affairs (OIRA) has designated this rule
as not a ‘‘major rule’’ as defined by 5
U.S.C. 804(2).
List of Subjects in 12 CFR Part 1083
Administrative practice and
procedure, Consumer protection,
Penalties.
Authority and Issuance
For the reasons set forth in the
preamble, the Bureau amends 12 CFR
part 1083 as set forth below:
PART 1083—CIVIL PENALTY
ADJUSTMENTS
1. The authority citation for part 1083
continues to read as follows:
■
Authority: 12 U.S.C. 2609(d); 12 U.S.C.
5113(d)(2); 12 U.S.C. 5565(c); 15 U.S.C.
1639e(k); 15 U.S.C. 1717a(a); 28 U.S.C. 2461
note.
Law
12
12
12
15
15
12
12
12
12
15
15
U.S.C.
U.S.C.
U.S.C.
U.S.C.
U.S.C.
U.S.C.
U.S.C.
U.S.C.
U.S.C.
U.S.C.
U.S.C.
5565(c)(2)(A) ...........................................................
5565(c)(2)(B) ...........................................................
5565(c)(2)(C) ..........................................................
1717a(a)(2) .............................................................
1717a(a)(2) .............................................................
2609(d)(1) ...............................................................
2609(d)(1) ...............................................................
2609(d)(2)(A) ..........................................................
5113(d)(2) ...............................................................
1639e(k)(1) .............................................................
1639e(k)(2) .............................................................
Dated: January 8, 2020.
Thomas Pahl,
Policy Associate Director, Bureau of
Consumer Financial Protection.
BILLING CODE 4810–AM–P
FEDERAL TRADE COMMISSION
16 CFR Part 1
Adjustments to Civil Penalty Amounts
Federal Trade Commission.
Final rule.
AGENCY:
The Federal Trade
Commission (‘‘FTC’’ or ‘‘Commission’’)
is implementing adjustments to the civil
penalty amounts within its jurisdiction
to account for inflation, as required by
law.
DATES: Effective January 14, 2020.
lotter on DSKBCFDHB2PROD with RULES
SUMMARY:
23 44
U.S.C. 3501–3521.
Law 114–74, sec. 701, 129 Stat. 599
(2015). The Act amends the Federal Civil Penalties
1 Public
16:28 Jan 13, 2020
(a) The maximum amount of each
civil penalty within the jurisdiction of
the Consumer Financial Protection
Bureau to impose is adjusted in
accordance with the Federal Civil
Penalties Inflation Adjustment Act of
1990, as amended by the Debt
Collection Improvement Act of 1996
and further amended by the Federal
Civil Penalties Inflation Adjustment Act
Improvements Act of 2015 (28 U.S.C.
2461 note), as follows:
Adjusted
maximum
civil penalty
amount
Jkt 250001
Tier 1 penalty ..........................................................................
Tier 2 penalty ..........................................................................
Tier 3 penalty ..........................................................................
Per violation .............................................................................
Annual cap ..............................................................................
Per failure ................................................................................
Annual cap ..............................................................................
Per failure, where intentional ..................................................
Per violation .............................................................................
First violation ...........................................................................
Subsequent violations .............................................................
$5,883
29,416
1,176,638
2,050
2,048,915
96
192,768
193
29,707
11,767
23,533
The
Federal Civil Penalties Inflation
Adjustment Act Improvements Act of
2015 1 directs agencies to adjust the civil
penalty maximums under their
jurisdiction for inflation every January.
Accordingly, the Commission issues
annual adjustments to the maximum
civil penalty amounts under its
jurisdiction.2
Commission Rule § 1.98 sets forth the
applicable civil penalty amounts for
violations of certain laws enforced by
the Commission.3 As directed by the
FCPIAA, the Commission is issuing
adjustments to increase these maximum
civil penalty amounts to address
inflation since its prior 2019
adjustment. The following adjusted
amounts will take effect on January 14,
2020:
• Section 7A(g)(1) of the Clayton Act,
15 U.S.C. 18a(g)(1) (premerger filing
notification violations under the HartScott-Rodino Improvements Act)—
Increase from $42,530 to $43,280;
• Section 11(l) of the Clayton Act, 15
U.S.C. 21(l) (violations of cease and
desist orders issued under Clayton Act
section 11(b))—Increase from $22,595 to
$22,994;
• Section 5(l) of the FTC Act, 15
U.S.C. 45(l) (unfair or deceptive acts or
practices)—Increase from $42,530 to
$43,280;
• Section 5(m)(1)(A) of the FTC Act,
15 U.S.C. 45(m)(1)(A) (unfair or
deceptive acts or practices)—Increase
from $42,530 to $43,280;
• Section 5(m)(1)(B) of the FTC Act,
15 U.S.C. 45(m)(1)(B) (unfair or
deceptive acts or practices)—Increase
from $42,530 to $43,280;
• Section 10 of the FTC Act, 15 U.S.C.
50 (failure to file required reports)—
Increase from $559 to $569;
• Section 5 of the Webb-Pomerene
(Export Trade) Act, 15 U.S.C. 65 (failure
by associations engaged solely in export
Inflation Adjustment Act (‘‘FCPIAA’’), Public Law
101–410, 104 Stat. 890 (codified at 28 U.S.C. 2461
note).
2 81 FR 42476 (June 30, 2016); 82 FR 8135 (2017);
83 FR 2902 (2018); 84 FR 3980 (2019).
3 16 CFR 1.98.
FOR FURTHER INFORMATION CONTACT:
Kenny A. Wright, Attorney, Office of the
General Counsel, FTC, 600
Pennsylvania Avenue NW, Washington,
DC 20580, (202–326–2907), kwright@
ftc.gov.
SUPPLEMENTARY INFORMATION:
[FR Doc. 2020–00364 Filed 1–13–20; 8:45 am]
VerDate Sep<11>2014
§ 1083.1 Adjustment of civil penalty
amounts.
Penalty description
(b) The adjustments in paragraph (a)
of this section shall apply to civil
penalties assessed after January 15,
2020, whose associated violations
occurred on or after November 2, 2015.
ACTION:
2. Section 1083.1 is revised to read as
follows:
■
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]]>Agencies
[Federal Register Volume 85, Number 9 (Tuesday, January 14, 2020)]
[Rules and Regulations]
[Pages 2012-2014]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-00364]
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BUREAU OF CONSUMER FINANCIAL PROTECTION
12 CFR Part 1083
Civil Penalty Inflation Adjustments
AGENCY: Bureau of Consumer Financial Protection.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Bureau of Consumer Financial Protection (Bureau) is
adjusting for inflation the maximum amount of each civil penalty within
the Bureau's jurisdiction. These adjustments are required by the
Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by
the Debt Collection Improvement Act of 1996 and further amended by the
Federal Civil Penalties Inflation Adjustment Act Improvements Act of
2015 (Inflation Adjustment Act). The inflation adjustments mandated by
the Inflation Adjustment Act serve to maintain the deterrent effect of
civil penalties and to promote compliance with the law.
DATES: This final rule is effective January 15, 2020.
FOR FURTHER INFORMATION CONTACT: Rachel Ross, Attorney-Advisor; Kristen
Phinnessee, Senior Counsel, Office of Regulations, at (202) 435-7700.
If you require this document in an alternative electronic format,
please contact [email protected].
SUPPLEMENTARY INFORMATION:
I. Background
The Federal Civil Penalties Inflation Adjustment Act of 1990,\1\ as
amended by the Debt Collection Improvement Act of 1996 \2\ and further
amended by the Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015 (Inflation Adjustment Act),\3\ directs Federal
agencies to adjust for inflation the civil penalty amounts within their
jurisdiction not later than July 1, 2016, and then not later than
January 15 every year thereafter.\4\ Each agency was required to make
the 2016 one-time catch-up adjustments through an interim final rule
published in the Federal Register. On June 14, 2016, the Bureau
published its interim final rule (IFR) to make the initial catch-up
adjustments to civil penalties within the Bureau's jurisdiction.\5\ The
June 2016 IFR created a new part 1083 and in Sec. 1083.1 established
the inflation-adjusted maximum amounts for each civil penalty within
the Bureau's jurisdiction.\6\ The Bureau finalized the IFR on January
31, 2019.\7\
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\1\ Public Law 101-410, 104 Stat. 890.
\2\ Public Law 104-134, section 31001(s)(1), 110 Stat. 1321,
1321-373.
\3\ Public Law 114-74, section 701, 129 Stat. 584, 599.
\4\ Section 1301(a) of the Federal Reports Elimination Act of
1998, Public Law 105-362, 112 Stat. 3293, also amended the Inflation
Adjustment Act by striking section 6, which contained annual
reporting requirements, and redesignating section 7 as section 6,
but did not alter the civil penalty adjustment requirements; 28
U.S.C. 2461 note.
\5\ 81 FR 38569 (June 14, 2016). Although the Bureau was not
obligated to solicit comments for the interim final rule, the Bureau
invited public comment and received none.
\6\ See 12 CFR 1083.1.
\7\ 84 FR 517 (Jan. 31, 2019).
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The Inflation Adjustment Act also requires subsequent adjustments
to be made annually, not later than January 15, and notwithstanding
section 553 of the Administrative Procedure Act (APA).\8\ The Bureau
annually adjusted its civil penalty amounts, as required by the Act,
through rules issued in January 2017, January 2018, and January
2019.\9\
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\8\ Inflation Adjustment Act section 4, codified at 28 U.S.C.
2461 note. As discussed in guidance issued by the Director of the
Office of Management and Budget (OMB), the APA generally requires
notice, an opportunity for comment, and a delay in effective date
for certain rulemakings, but the Inflation Adjustment Act provides
that these procedures are not required for agencies to issue
regulations implementing the annual adjustment. See Memorandum to
the Exec. Dep'ts & Agencies from Russell T. Vought, Acting Director,
Office of Mgmt. & Budget at 4 (Dec. 16, 2019), available at https://www.whitehouse.gov/wp-content/uploads/2019/12/M-20-05.pdf.
\9\ 82 FR 3601 (Jan. 12, 2017); 83 FR 1525 (Jan. 12, 2018); 84
FR 517 (Jan. 31, 2019).
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Specifically, the Act directs Federal agencies to adjust annually
each civil penalty provided by law within the jurisdiction of the
agency by the ``cost-of-living adjustment.'' \10\ The ``cost-of-living
adjustment'' is defined as the percentage (if any) by which the
Consumer Price Index for all-urban consumers (CPI-U) for the month of
October preceding the date of the adjustment, exceeds the CPI-U for
October of the prior year.\11\ The Director of the Office of Management
and Budget (OMB) is required to issue guidance (OMB Guidance) every
year by
[[Page 2013]]
December 15 to agencies on implementing the annual civil penalty
inflation adjustments. Pursuant to the Inflation Adjustment Act and OMB
Guidance, agencies must apply the multiplier reflecting the ``cost-of-
living adjustment'' to the current penalty amount and then round that
amount to the nearest dollar to determine the annual adjustments.\12\
The adjustments are designed to keep pace with inflation so that civil
penalties retain their deterrent effect and promote compliance with the
law.\13\
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\10\ Inflation Adjustment Act sections 4 and 5, codified at 28
U.S.C. 2461 note.
\11\ Inflation Adjustment Act sections 3 and 5, codified at 28
U.S.C. 2461 note.
\12\ Inflation Adjustment Act section 5, codified at 28 U.S.C.
2461 note; see also Memorandum to the Exec. Dep'ts & Agencies from
Russell T. Vought, Acting Director, Office of Mgmt. & Budget (Dec.
16, 2019), available at https://www.whitehouse.gov/wp-content/uploads/2019/12/M-20-05.pdf.
\13\ See Inflation Adjustment Act section 2, codified at 28
U.S.C. 2461 note.
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For the 2020 annual adjustment, the multiplier reflecting the
``cost-of-living adjustment'' is 1.01764.\14\
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\14\ Memorandum to the Exec. Dep'ts & Agencies from Russell T.
Vought, Acting Director, Office of Mgmt. & Budget (Dec. 16, 2019),
available at https://www.whitehouse.gov/wp-content/uploads/2019/12/M-20-05.pdf.
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II. Adjustment
Pursuant to the Inflation Adjustment Act and OMB Guidance, the
Bureau multiplied each of its civil penalty amounts by the ``cost-of-
living adjustment'' multiplier and rounded to the nearest dollar.\15\
The new penalty amounts that apply to civil penalties assessed after
January 15, 2020, are as follows:
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\15\ Inflation Adjustment Act section 4, codified at 28 U.S.C.
2461 note.
----------------------------------------------------------------------------------------------------------------
Penalty
amounts OMB ``cost-of-
Law Penalty description established living New penalty
under 2019 adjustment'' amount
final rule multiplier
----------------------------------------------------------------------------------------------------------------
Consumer Financial Protection Act, 12 Tier 1 penalty.......... $5,781 1.01764 $5,883
U.S.C. 5565(c)(2)(A).
Consumer Financial Protection Act, 12 Tier 2 penalty.......... 28,906 1.01764 29,416
U.S.C. 5565(c)(2)(B).
Consumer Financial Protection Act, 12 Tier 3 penalty.......... 1,156,242 1.01764 1,176,638
U.S.C. 5565(c)(2)(C).
Interstate Land Sales Full Disclosure Per violation........... 2,014 1.01764 2,050
Act, 15 U.S.C. 1717a(a)(2).
Interstate Land Sales Full Disclosure Annual cap.............. 2,013,399 1.01764 2,048,915
Act, 15 U.S.C. 1717a(a)(2).
Real Estate Settlement Procedures Act, Per failure............. 94 1.01764 96
12 U.S.C. 2609(d)(1).
Real Estate Settlement Procedures Act, Annual cap.............. 189,427 1.01764 192,768
12 U.S.C. 2609(d)(1).
Real Estate Settlement Procedures Act, Per failure, where 190 1.01764 193
12 U.S.C. 2609(d)(2)(A). intentional.
SAFE Act, 12 U.S.C. 5113(d)(2)........ Per violation........... 29,192 1.01764 29,707
Truth in Lending Act, 15 U.S.C. First violation......... 11,563 1.01764 11,767
1639e(k)(1).
Truth in Lending Act, 15 U.S.C. Subsequent violations... 23,125 1.01764 23,533
1639e(k)(2).
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III. Procedural Requirements
A. Administrative Procedure Act
Under the Administrative Procedure Act, notice and opportunity for
public comment are not required if the Bureau finds that notice and
public comment are impracticable, unnecessary, or contrary to the
public interest.\16\ The adjustments to the civil penalty amounts are
technical and non-discretionary, and they merely apply the statutory
method for adjusting civil penalty amounts. These adjustments are
required by the Inflation Adjustment Act. Moreover, the Inflation
Adjustment Act directs agencies to adjust civil penalties annually
notwithstanding section 553 of the APA,\17\ and OMB Guidance reaffirms
that agencies need not complete a notice-and-comment process before
making the annual adjustments for inflation.\18\ For these reasons, the
Bureau has determined that publishing a notice of proposed rulemaking
and providing opportunity for public comment are unnecessary. The
amendments therefore are adopted in final form.
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\16\ 5 U.S.C. 553(b)(B).
\17\ Inflation Adjustment Act section 4, codified at 28 U.S.C.
2461 note.
\18\ Memorandum to the Exec. Dep'ts & Agencies from Russell T.
Vought, Acting Director, Office of Mgmt. & Budget (Dec. 16, 2019),
available at https://www.whitehouse.gov/wp-content/uploads/2019/12/M-20-05.pdf.
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Section 553(d) of the APA generally requires publication of a final
rule not less than 30 days before its effective date, except (1) a
substantive rule which grants or recognizes an exemption or relieves a
restriction; (2) interpretive rules and statements of policy; or (3) as
otherwise provided by the agency for good cause found and published
with the rule.\19\ At minimum, the Bureau believes the annual
adjustments to the civil penalty amounts in Sec. 1083.1(a) fall under
the third exception to section 553(d). The Bureau finds that there is
good cause to make the amendments effective on January 15, 2020. The
amendments to Sec. [thinsp]1083.1(a) in this final rule are technical
and non-discretionary, and they merely apply the statutory method for
adjusting civil penalty amounts and follow the statutory directive to
make annual adjustments each year. Moreover, the Inflation Adjustment
Act directs agencies to adjust the civil penalties annually
notwithstanding section 553 of the APA,\20\ and OMB Guidance reaffirms
that agencies need not provide a delay in effective date for the annual
adjustments for inflation.\21\
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\19\ 5 U.S.C. 553(d).
\20\ Inflation Adjustment Act section 4, codified at 28 U.S.C.
2461 note.
\21\ [thinsp]Memorandum to the Exec. Dep'ts & Agencies from
Russell T. Vought, Acting Director, Office of Mgmt. & Budget (Dec.
16, 2019), available at https://www.whitehouse.gov/wp-content/uploads/2019/12/M-20-05.pdf.
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B. Regulatory Flexibility Act
Because no notice of proposed rulemaking is required, the
Regulatory Flexibility Act does not require an initial or final
regulatory flexibility analysis.\22\
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\22\ 5 U.S.C. 603(a), 604(a).
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C. Paperwork Reduction Act
The Bureau has determined that this final rule does not impose any
new or revise any existing recordkeeping, reporting, or disclosure
requirements on covered entities or members of the public that would be
collections of information requiring approval by the
[[Page 2014]]
Office of Management and Budget under the Paperwork Reduction Act.\23\
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\23\ 44 U.S.C. 3501-3521.
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D. Congressional Review Act
Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.),
the Bureau will submit a report containing this rule and other required
information to the United States Senate, the United States House of
Representatives, and the Comptroller General of the United States prior
to the rule taking effect. The Office of Information and Regulatory
Affairs (OIRA) has designated this rule as not a ``major rule'' as
defined by 5 U.S.C. 804(2).
List of Subjects in 12 CFR Part 1083
Administrative practice and procedure, Consumer protection,
Penalties.
Authority and Issuance
For the reasons set forth in the preamble, the Bureau amends 12 CFR
part 1083 as set forth below:
PART 1083--CIVIL PENALTY ADJUSTMENTS
0
1. The authority citation for part 1083 continues to read as follows:
Authority: 12 U.S.C. 2609(d); 12 U.S.C. 5113(d)(2); 12 U.S.C.
5565(c); 15 U.S.C. 1639e(k); 15 U.S.C. 1717a(a); 28 U.S.C. 2461
note.
0
2. Section 1083.1 is revised to read as follows:
Sec. 1083.1 Adjustment of civil penalty amounts.
(a) The maximum amount of each civil penalty within the
jurisdiction of the Consumer Financial Protection Bureau to impose is
adjusted in accordance with the Federal Civil Penalties Inflation
Adjustment Act of 1990, as amended by the Debt Collection Improvement
Act of 1996 and further amended by the Federal Civil Penalties
Inflation Adjustment Act Improvements Act of 2015 (28 U.S.C. 2461
note), as follows:
------------------------------------------------------------------------
Adjusted maximum
Law Penalty description civil penalty
amount
------------------------------------------------------------------------
12 U.S.C. 5565(c)(2)(A)....... Tier 1 penalty....... $5,883
12 U.S.C. 5565(c)(2)(B)....... Tier 2 penalty....... 29,416
12 U.S.C. 5565(c)(2)(C)....... Tier 3 penalty....... 1,176,638
15 U.S.C. 1717a(a)(2)......... Per violation........ 2,050
15 U.S.C. 1717a(a)(2)......... Annual cap........... 2,048,915
12 U.S.C. 2609(d)(1).......... Per failure.......... 96
12 U.S.C. 2609(d)(1).......... Annual cap........... 192,768
12 U.S.C. 2609(d)(2)(A)....... Per failure, where 193
intentional.
12 U.S.C. 5113(d)(2).......... Per violation........ 29,707
15 U.S.C. 1639e(k)(1)......... First violation...... 11,767
15 U.S.C. 1639e(k)(2)......... Subsequent violations 23,533
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(b) The adjustments in paragraph (a) of this section shall apply to
civil penalties assessed after January 15, 2020, whose associated
violations occurred on or after November 2, 2015.
Dated: January 8, 2020.
Thomas Pahl,
Policy Associate Director, Bureau of Consumer Financial Protection.
[FR Doc. 2020-00364 Filed 1-13-20; 8:45 am]
BILLING CODE 4810-AM-P
