Agency Information Collection Activities; Proposed Renewal; Comment Request; Renewal Without Change of Regulations Requiring Additional Records To Be Made and Retained by Dealers in Foreign Exchange and Additional Records To Be Made and Retained by Brokers or Dealers in Securities, 7778-7783 [2021-02064]
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Federal Register / Vol. 86, No. 19 / Monday, February 1, 2021 / Notices
about broker services, the HHG brokers
must collect the following information
and distribute it to HHG shippers:
1. A list of motor carriers with whom
it has agreements (49 CFR 371.109(a));
and
2. A statement indicating the broker is
not a motor carrier and that the broker
is only arranging transportation of the
shipper’s goods (49 CFR 371.109(b)).
III. Third Phase: ‘‘Estimate’’
When HHG shippers request
estimates, the HHG brokers must collect
the following information and distribute
it to HHG shippers and/or store the
information received:
1. FMCSA’s published information
materials: (1) ‘‘Ready to Move?—Tips
for a Successful Interstate Move’’ and (2)
‘‘Your Rights and Responsibilities When
you Move’’ (49 CFR 371.111(a)(1),(a)(2),
& (a)(3));
2. A document signed by the shipper,
showing he/she received FMCSA’s
published information material (49 CFR
371.111(c));
3. A written estimate based on the
motor carrier’s physical survey of
household items (49 CFR 371.113(a)),
with estimates based on published
motor carrier rates (49 CFR 371.113(b));
4. If applicable, the shipper must sign
a ‘‘Waiver’’ receipt, showing he/she has
waived his/her right to a physical
survey of his/her household items by
the motor carrier. The HHG broker must
collect the ‘‘Waiver’’ receipt and store
the record (49 CFR 371.113(b)).
IV. Fourth Phase: ‘‘Agreement’’
Should the shipper find the shipping
estimate and broker services reasonable
and wish to contract the broker’s
services, the two parties must enter into
an agreement. At this point, it is
standard practice for shippers to pay
either a deposit or make full payment.
However, before collecting any
payment, the broker must collect the
following information and distribute it
to the HHG shipper:
• An agreement document with
required specifications as laid out by 49
CFR 371.115; and
• An agreement document which
highlights the broker’s and/or motor
carrier’s refund policy for cancellation
of agreements (49 CFR 371.117(a)).
The information provided in phases I,
II, III, and IV supports the requirements
of 49 CFR part 371, subpart B, and the
Department’s secondary mission to
support HHG consumer protection.
The complete collection of
information required by the referenced
final rule assists HHG shippers in their
business dealings with interstate HHG
brokers. The information collected is
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used by prospective HHG shippers to
make informed decisions about
contracts, services ordered, executed,
and settled. The HHG broker is often the
earliest contact for individual HHG
shippers in an interstate moving
transaction; therefore, it makes sense for
HHG brokers to provide HHG shippers
with consumer protection information.
FMCSA revises the total annual
burden to 72,808 hours. This is a 2,723
annual burden hour increase from the
currently approved 70,085 annual
burden estimate. This increase is due to
the following: (1) The previous iteration
did not account for the time brokers use
to complete a ‘‘waiver’’ should shippers
choose to waive their rights to a
physical survey, if applicable to a
shipper, as required by 49 CFR
371.113(c)(1), (c)(2), and (c)(3); (2) the
previous iteration did not clarify a
reproducible frequency formula used to
calculate the number of times brokers
collect information and submit
information to shippers. To produce a
reproducible frequency formula, the
updated information collection
introduced the concept of ‘‘phases,’’
which created a frequency number
based on business interactions between
brokers and shippers as explained
above; and (3) FMCSA’s records
indicate the number of household goods
brokers increased from 543 brokers to
652 brokers.
In addition to the above, an
adjustment was made to this ICR
revision from the previous ICR renewal
with regards to the annual hourly
burden estimate for broker ‘‘transaction
records’’(49 CFR 371.3). The annual
hourly burden was removed from this
ICR revision because the burden is for
the collection of information that the
broker would ordinarily record for other
standard business practices such as tax
purposes. As a result, the associated
annual hourly burden estimate is
removed. The previous ICR accounted
32,580 annual burden hours 2 for
‘‘transaction records,’’ while this ICR
revises the annual burden to 0 hours.
Title: Practices of Household Goods
Brokers.
OMB Control Number: 2126–0048.
Type of Request: Revision of currently
approved collection.
Respondents: Brokers of Household
Goods.
Estimated Number of Respondents:
652.
2 FMCSA derived the annual hourly burden by
applying the following formula: Time spent on
shipper transaction record keeping per day ×
number of work days × the number of brokers. The
calculation was 15 minutes per day × 240 workdays
× 543 brokers, which resulted in an annual burden
of 32,580 hours.
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Estimated Number of Responses:
500,084 responses.
Expiration Date: January 31, 2021.
Frequency of Response: On occasion.
Estimated Total Annual Burden:
72,808 hours.
Public Comments Invited: You are
asked to comment on any aspect of this
information collection, including: (1)
Whether the proposed collection is
necessary for the FMCSA to perform its
functions; (2) the accuracy of the
estimated burden; (3) ways for the
FMCSA to enhance the quality,
usefulness, and clarity of the collected
information; and (4) ways that the
burden could be minimized without
reducing the quality of the collected
information.
Issued under the authority delegated in 49
CFR part 1.87.
Thomas P. Keane,
Associate Administrator, Office of Research
and Registration.
[FR Doc. 2021–02021 Filed 1–29–21; 8:45 am]
BILLING CODE 4910–EX–P
DEPARTMENT OF THE TREASURY
Financial Crimes Enforcement Network
Agency Information Collection
Activities; Proposed Renewal;
Comment Request; Renewal Without
Change of Regulations Requiring
Additional Records To Be Made and
Retained by Dealers in Foreign
Exchange and Additional Records To
Be Made and Retained by Brokers or
Dealers in Securities
Financial Crimes Enforcement
Network (FinCEN), Treasury.
ACTION: Notice and request for
comments.
AGENCY:
As part of its continuing effort
to reduce paperwork and respondent
burden, FinCEN invites comments on
the proposed renewal, without change,
of a currently approved information
collections found in existing Bank
Secrecy Act regulations. Specifically,
the regulations require dealers in foreign
exchange and brokers or dealers in
securities to secure and maintain a
record of the taxpayer identification
number for individuals for whom a
transaction or brokerage account is
opened, or for whom a line of credit is
extended, subject to certain exceptions.
The regulations also require that the
dealers in foreign exchange and brokers
or dealers in securities retain originals
or copies of specified documents
relating to account and transaction
records. Although no changes are
proposed to the information collections
SUMMARY:
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themselves, this request for comments
covers a future expansion of the scope
of the annual hourly burden and cost
estimate associated with these
regulations. This request for comments
is made pursuant to the Paperwork
Reduction Act of 1995.
DATES: Written comments are welcome,
and must be received on or before April
2, 2021
ADDRESSES: Comments may be
submitted by any of the following
methods:
• Federal E-rulemaking Portal: https://
www.regulations.gov. Follow the
instructions for submitting comments.
Refer to Docket Number FINCEN–2021–
0003 and the specific Office of
Management and Budget (OMB) control
numbers 1506–0052 and 1506–0053.
• Mail: Policy Division, Financial
Crimes Enforcement Network, P.O. Box
39, Vienna, VA 22183. Refer to Docket
Number FINCEN–2021–0003 and OMB
control numbers 1506–0052 and 1506–
0053.
Please submit comments by one
method only. Comments will also be
taken into account in FinCEN’s review
of existing regulations, consistent with
by Treasury’s 2011 Plan for
Retrospective Analysis of Existing
Rules. All comments submitted in
response to this notice will become a
matter of public record. Therefore, you
should submit only information that
you wish to make publicly available.
FOR FURTHER INFORMATION CONTACT: The
FinCEN Regulatory Support Section at
1–800–767–2825 or electronically at
frc@fincen.gov.
SUPPLEMENTARY INFORMATION:
I. Statutory and Regulatory Provisions
The legislative framework generally
referred to as the Bank Secrecy Act
(BSA) consists of the Currency and
Financial Transactions Reporting Act of
1970, as amended by the Uniting and
Strengthening America by Providing
Appropriate Tools Required to Intercept
and Obstruct Terrorism Act of 2001
(USA PATRIOT Act) (Pub. L. 107–56)
and other legislation. The BSA is
codified at 12 U.S.C. 1829b, 12 U.S.C.
1951–1959, 31 U.S.C. 5311–5314 and
5316–5332, and notes thereto, with
implementing regulations at 31 CFR
Chapter X.
The BSA authorizes the Secretary of
the Treasury, inter alia, to require
financial institutions to keep records
and file reports that are determined to
have a high degree of usefulness in
criminal, tax, and regulatory matters, or
in the conduct of intelligence or
counter-intelligence activities to protect
against international terrorism, and to
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implement anti-money laundering
(AML) programs and compliance
procedures.1 Regulations implementing
the BSA appear at 31 CFR Chapter X.
The authority of the Secretary to
administer the BSA has been delegated
to the Director of FinCEN.2
a. 31 CFR 1022.410—Additional
Records To Be Made and Retained by
Dealers in Foreign Exchange
31 CFR 1022.410(a) requires a dealer
in foreign exchange to make and
maintain a record of the taxpayer
identification number of certain persons
for whom a transaction account is
opened or a line of credit is extended,
within 30 days of opening such an
account or extending such a line of
credit, or longer if the person has
applied for a taxpayer identification or
social security number. A dealer in
foreign exchange must also maintain a
list containing the names, addresses,
and account or credit line numbers of
those persons from whom it has been
unable to secure such information
despite reasonable efforts. A dealer in
foreign exchange need not attempt to
secure such information if the person is
an agency or instrumentality of a
Federal, state, local, or foreign
government using an account for public
funds, one of several categories of aliens
that are not permanent resident aliens,
or an unincorporated subordinate unit
of a tax exempt organization covered by
a group exemption letter.
Under 31 CFR 1022.410(b), a dealer in
foreign exchange must also retain the
original or a copy of nine types of
documents: (1) Statements of accounts
from banks, including documents
representing the entries reflected on
such statements; (2) daily work records,
including documents needed to identify
and reconstruct currency transactions
with customers and foreign banks; (3) a
record of each exchange of currency
involving transactions in excess of
$1,000, including the customer’s name
and address (and passport or tax
identification number unless received
by mail or common carrier), the date
and amount of the transaction, and the
currency name, country, and total
amount of each foreign currency; (4)
signature cards or other documents
evidencing signature authority over
1 Section 358 of the USA PATRIOT Act added
language expanding the scope of the BSA to
intelligence or counter-intelligence activities to
protect against international terrorism. Section 6101
of the Anti-Money Laundering Act of 2020 (‘‘the
AML Act’’) added language further expanding the
scope of the BSA but did not disturb these
longstanding purposes. The AML Act is Division F
of Public Law 116–283 (January 1, 2021).
2 Treasury Order 180–01 (re-affirmed Jan. 14,
2020).
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each deposit or security account,
containing specified items of
information about the customer
(including a record of the actual owner
of the account if customer accounts are
maintained in a code name); (5) each
item, including checks, drafts, and
transfers of credit, of more than $10,000
remitted or transferred to a person,
account, or place outside the United
States; (6) a record of each receipt of
currency, other monetary instruments,
investment securities and checks, and of
each transfer of funds or credit, of more
than $10,000 received on any one
occasion directly and not through a
domestic financial institution, from any
person, account, or place outside the
United States; (7) records prepared or
received by the dealer in foreign
exchange in the ordinary course of
business that would be needed to
reconstruct an account and trace a check
in excess of $100 deposited in such an
account through its internal
recordkeeping system to its depository
institution, or to supply a description of
such a deposited check; (8) a record of
the name, address and taxpayer
identification number of any person
presenting a certificate of deposit for
payment, as well as a description of the
instrument and the date of the
transaction; and (9) a system of books
and records that enables the dealer in
foreign exchange to prepare an accurate
balance sheet and income statement. To
the extent that these records include
originals or copies of checks, drafts,
monetary instruments, investment
securities, or other similar instruments,
copies of front and back of such
instruments must generally be retained.3
The required records must be
maintained for five years.4
b. 31 CFR 1023.410—Additional
Records To Be Made and Retained by
Brokers or Dealers in Securities
Until October 1, 2003, 31 CFR
1023.410(a) required a broker or dealer
in securities to make a record of certain
information. Until October 1, 2008, a
broker or dealer in securities was
required to maintain all such records, as
well as a list containing the names,
addresses, and account or credit line
numbers of those persons from whom it
had been unable to secure the required
information despite reasonable efforts.
The customer identification program
requirement for brokers or dealers in
3 31
4 31
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CFR 1010.430(a).
CFR 1010.430(d).
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securities has effectively superseded
these requirements.5
Under 31 CFR 1023.410(b), a broker or
dealer in securities must retain an
original or copy of: (1) Each document
granting signature or trading authority
over each customer’s account; (2) a
record of each remittance or transfer of
funds, currency, checks, other monetary
instruments, investment securities, or
credit, of more than $10,000 to a person,
account, or place outside the United
States; (3) a record of each receipt of
currency, other monetary instruments,
investment securities, or checks, and of
each transfer of funds or credit, of more
than $10,000 on any one occasion, not
through a domestic financial institution,
from any person, account, or place
outside the United States; and (4) each
record described in paragraphs (1), (2),
(3), (5), (6), (7), (8), and (9) of 17 CFR
240.17a–3(a), covering records to be
made by certain exchange members,
brokers and dealers as identified in 17
CFR 240.17a–3. To the extent that these
records include originals or copies of
checks, drafts, monetary instruments,
investment securities, or other similar
instruments, copies of front and back of
such instruments must generally be
retained.6 The required records must be
maintained for five years.7
II. Paperwork Reduction Act of 1995
(PRA) 8
Title: Additional records to be made
and retained by dealers in foreign
exchange and additional records to be
made and retained by brokers or dealers
in securities (31 CFR 1022.410 and 31
CFR 1023.410).
OMB Control Numbers: 1506–0052
and 1506–0053.
Report Number: Not applicable.
Abstract: FinCEN is issuing this
notice to renew the OMB control
numbers for record-keeping
requirements for dealers in foreign
exchange and brokers or dealers in
securities.
Affected Public: Businesses or other
for-profit institutions, and non-profit
institutions.
Type of Review:
• Renewal without change of a
currently approved information
collection.
• Propose for review and comment a
renewal of the portion of the PRA
burden that has been subject to notice
and comment in the past (the
‘‘traditional annual PRA burden’’).
• Propose for review and comment a
future expansion of the scope of the
PRA burden (the ‘‘future annual PRA
burden’’).
Frequency: As required.
Estimated Number of Respondents:
4,563 financial institutions.9
Estimated Recordkeeping Burden: In
Part 1 of this notice, FinCEN describes
the breakdown of the estimated number
of financial institutions, by type,
affected by each of the regulatory
requirements. In Part 2, FinCEN
proposes for review and comment a
renewal of the estimate of the traditional
annual PRA hourly burden, which
includes an annual hourly burden
estimate per financial institution similar
to that used in the past, with the
incorporation of a more robust cost
estimate. The scope and methodology
used in the past assigned a total annual
hourly burden estimate, per financial
institution, to multiple recordkeeping
requirements within the regulations. In
Part 3, FinCEN proposes for review and
comment a methodology to estimate the
hourly burden and the cost of a future
estimate of an annual PRA burden that
includes the burden and cost broken
down by each unique type of
recordkeeping requirement covered by
the regulations being renewed. The
methodology also includes identifying
estimates for the number of transactions
conducted annually, per financial
institution, which would trigger each
unique recordkeeping requirement.
Finally, in Part 4, FinCEN solicits input
from the public about: (a) The accuracy
of the estimate of the traditional annual
PRA burden; (b) the method proposed to
be more granular in the calculation of
burden per unique recordkeeping
requirement, within the regulations, to
establish a future annual PRA burden;
(c) the criteria, metrics, and most
appropriate questions FinCEN should
consider when researching the
information to estimate the future
annual PRA burden, according to the
methodology proposed; and (d) any
other comments about the regulations
and the current and proposed future
hourly burden and cost estimates of
these requirements.
Part 1. Breakdown of the Financial
Institutions Covered by This Notice
The breakdown of financial
institutions, by type, covered by this
notice is reflected in Table 1 below:
TABLE 1—BREAKDOWN OF FINANCIAL INSTITUTIONS COVERED BY THIS NOTICE, BY TYPE OF FINANCIAL INSTITUTION
Number of
financial
institutions
Type of financial institution
Dealers in foreign exchange .......................................................................................................................................................................
Brokers or dealers in securities ..................................................................................................................................................................
11 3,640
Total number of financial institutions .......................................................................................................................................................
4,563
Part 2. Traditional Annual PRA Burden
and Cost
10 923
those persons from whom it has been
unable to secure such information
despite reasonable efforts.
Each dealer in foreign exchange must
make and maintain a record of the
taxpayer identification number of
certain persons for whom a transaction
account is opened or a line of credit is
extended within 30 days of opening
such an account or extending such a
line of credit, or longer if the person has
applied for a taxpayer identification or
social security number. A dealer in
foreign exchange must also maintain a
list containing the names, addresses,
and account or credit line numbers of
5 31 CFR 1023.220. The burden associated with
these requirement is calculated under OMB control
number 1506–0034.
6 31 CFR 1010.430(a).
7 31 CFR 1010.430(d).
8 Public Law 104–13, 44 U.S.C. 3506(c)(2)(A).
9 Table 1 below sets forth a breakdown of the
types of financial institutions covered by this
notice.
10 This number is derived from self-reported
information in MSB registrations submitted to
FinCEN. FinCEN’s MSB registration database is
available at https://www.fincen.gov/msb-stateselector.
11 According to the Securities and Exchange
Commission (SEC), there were 3,640 brokers or
dealers in securities registered with the SEC, as of
March 31, 2020.
OMB Control Number 1506–0052
31 CFR 1022.410(a)
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31 CFR 1022.410(b)
Each dealer in foreign exchange must
retain the original or a copy of nine
types of documents as described in
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Section I—Statutory and Regulatory
Provisions above.
Due to the challenges of obtaining the
total number of such records required to
be maintained by dealers in foreign
exchange under 31 CFR 1022.410, in its
most recent control number renewal,
FinCEN estimated that the annual
recordkeeping burden per dealer in
foreign exchange for these requirements
was 16 hours.12 FinCEN continues to
estimate that the annual hourly burden
of complying with 31 CFR 1022.410 is
16 hours per dealer in foreign exchange.
923 dealers in foreign exchange 13
multiplied by 16 hours, results in a total
annual hourly burden estimate of 14,768
hours.
securities, in its most recent control
number renewal, FinCEN estimated that
the annual recordkeeping burden per
broker or dealer in securities for these
requirements was 100 hours.14 FinCEN
continues to estimate that the annual
hourly burden of complying with 31
CFR 1023.410 is 100 hours per broker or
dealer in securities.
3,640 brokers or dealers in
securities 15 multiplied by 100 hours,
results in a total annual hourly burden
estimate of 364,000 hours.
OMB Control Number 1506–0053
31 CFR 1023.410(a)
As noted above, brokers or dealers in
securities have no recordkeeping
responsibilities under this provision;
the obligation on brokers or dealers in
securities to maintain customer
identification programs pursuant to 31
CFR 1023.220 has effectively replaced
these responsibilities.
31 CFR 1023.410(b)
Each broker or dealer in securities
must retain an original or copy of
certain types of documents as described
in Section I—Statutory and Regulatory
Provisions above.
Due to the challenges of obtaining the
total number of such records required to
be maintained by brokers or dealers in
Total Annual Traditional PRA Hourly
Burden for OMB Control Numbers
1506–0052 and 1506–0053
FinCEN’s estimate of the traditional
annual PRA burden, therefore, is
378,768 hours, as detailed in Table 2
below:
TABLE 2—BREAKDOWN OF FINANCIAL INSTITUTIONS IMPACTED BY EACH REGULATORY REQUIREMENT, AND THE
ESTIMATED TOTAL ANNUAL BURDEN HOURS PER REQUIREMENT
Number of
financial
institutions
Type of financial institution
impacted by the requirement
Regulatory requirement
31 CFR 1022.410—OMB Control Number
1506–0052.
31 CFR 1023.410—OMB Control Number
1506–0053.
Total annual hour burden hours ..............
To calculate the hourly costs of the
burden estimate, FinCEN identified
three roles and corresponding staff
positions involved in maintaining
records as required by 31 CFR 1022.410
and 1023.410: (i) General supervision
Traditional
annual burden
estimate per
financial
institution
(hours)
Total annual
burden hours
per regulatory
requirement
Dealers in foreign exchange ..........................
923
16
14,768
Brokers or dealers in securities .....................
3,640
100
364,000
.........................................................................
........................
........................
378,768
(providing process oversight); (ii) direct
supervision (reviewing operational-level
work and cross-checking all or a sample
of the work product against supporting
documentation); and (iii) clerical work
(engaging in recordkeeping).
FinCEN calculated the fully-loaded
hourly wage for each of these three roles
by using the median wage estimated by
the U.S. Bureau of Labor Statistics
(BLS),16 and computing an additional
benefits cost as follows:
TABLE 3—FULLY-LOADED HOURLY WAGE BY ROLE AND BLS JOB POSITION FOR ALL FINANCIAL INSTITUTIONS COVERED
BY THIS NOTICE
Role
BLS-code
General supervision ..............................................
Direct supervision .................................................
Clerical work (research, review, and recordkeeping).
FinCEN estimates that, in general and
on average,17 each role would spend
different amounts of time on each
12 82
FR 31686, 31687 (July 7, 2017).
Table 1, supra.
14 82 FR 31686, 31687 (July 7, 2017).
15 See Table 1, supra.
16 The U.S. Bureau of Labor Statistics,
Occupational Employment Statistics-National, May
2019, available at https://www.bls.gov/oes/
tables.htm. The most recent data from the BLS
13 See
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BLS-name
11–3031
13–1041
43–3099
Median hourly
wage
Financial Manager ........
Compliance Officer .......
Financial Clerk ..............
$62.45
33.20
20.40
Benefit factor
1.50
1.50
1.50
Fully-loaded
hourly wage
$93.68
49.80
30.60
portion of the traditional annual PRA
burden, as follows:
The cost of each hour of burden,
broken down by role, to produce and
maintain records as outlined in 31 CFR
corresponds to May 2019. For the benefits
component of total compensation, see U.S. Bureau
of Labor Statistics, Employer’s Cost per Employee
Compensation as of December 2019, available at
https://www.bls.gov/news.release/ecec.nr0.htm. The
ratio between benefits and wages for financial
activities is $15.95 (hourly benefits)/$32.05 (hourly
wages) = 0.50. The benefit factor is 1 plus the
benefit/wages ratio, or 1.50. Multiplying each
hourly wage by the benefit factor produces the
fully-loaded hourly wage per position.
17 By ‘‘in general,’’ FinCEN means without regard
to outliers (e.g., financial institutions with accounts
or transactions that require recordkeeping that is
uncommonly higher or lower than those of the
population at large). By ‘‘on average,’’ FinCEN
means the mean of the distribution of each subset
of the population.
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1022.410 and 31 CFR 1023.410 would
be $37.00 as set out in Table 4 below:
TABLE 4—WEIGHTED AVERAGE HOURLY COST OF MAKING AND RETAINING THE RECORDS
General supervision
Direct supervision
Clerical work
% Time
Hourly cost
% Time
Hourly cost
% Time
Hourly cost
Weighted average
hourly cost
5%
$4.68
15
$7.47
80
$24.48
$37.00
$36.63 rounded to $37.00.
The total estimated cost of the
traditional annual PRA burden is
$14,014,416, as reflected in Table 5
below:
TABLE 5—TOTAL COST OF TRADITIONAL ANNUAL PRA BURDEN
OMB control No./regulation
Hourly burden
Hourly cost
Total cost
1506–0052 (31 CFR 1022.410) ...................................................................................................
1506–0053 (31 CFR 1023.410) ...................................................................................................
14,768
364,000
$37
37
$546,416
13,468,000
Total cost ..............................................................................................................................
........................
........................
14,014,416
Part 3. Future Annual PRA Burden
In the future, FinCEN will include the
burden and cost for each type of
recordkeeping requirement covered by
the regulations being renewed. The
future burden estimate will also include
estimates of the number of transactions
conducted annually per financial
institution, which trigger each
recordkeeping requirement.
31 CFR 1022.410(a)
Each dealer in foreign exchange must
make and maintain a record of the
taxpayer identification number of
certain persons for whom a transaction
account is opened or a line of credit is
extended within 30 days of opening
such an account or extending such a
line of credit, or longer if the person has
applied for a taxpayer identification or
social security number. A dealer in
foreign exchange must also maintain a
list containing the names, addresses,
and account or credit line numbers of
those persons from whom it has been
unable to secure such information
despite reasonable efforts. In order to
more accurately estimate the related
PRA burden in the future, FinCEN
intends to obtain a better understanding
of the volume of transaction accounts
and lines of credit opened per year by
dealers in foreign exchange.
31 CFR 1022.410(b)
As described in greater detail in
Section I—Statutory and Regulatory
Provisions above, each dealer in foreign
exchange must retain the original or a
copy of nine types of documents. In
order to more accurately estimate the
related PRA burden in the future,
FinCEN intends to obtain a better
VerDate Sep<11>2014
16:57 Jan 29, 2021
Jkt 253001
understanding of the volume of
transactions that trigger such
recordkeeping requirements per year by
dealers in foreign exchange.
31 CFR 1023.410(b)
Each broker or dealer in securities
must retain an original or copy of
certain types of documents as described
in Section I—Statutory and Regulatory
Provisions above. In order to more
accurately estimate the related PRA
burden in the future, FinCEN intends to
obtain a better understanding of the
volume of transactions that trigger such
recordkeeping requirements per year by
brokers or dealers in exchange.
FinCEN does not have the information
needed to estimate the number of
annual transactions that trigger each
recordkeeping requirement being
renewed in this notice. For that reason,
FinCEN is relying on estimates used in
prior renewals of these OMB control
numbers and the applicable regulations.
FinCEN further recognizes that after
receiving public comments as a result of
this notice, future annual PRA hourly
burden and cost estimates may vary
significantly. In order to arrive at more
precise estimates of net BSA hourly
burden and cost, FinCEN intends to
conduct more granular studies in the
near future, regarding the types and
volume of transactions conducted
annually, which trigger each
recordkeeping requirement, and the
time it takes to collect and record the
information required for each
recordkeeping requirement.18 The data
18 Net hourly burden and cost are the burden and
cost a financial institution incurs to comply with
requirements that are unique to the BSA, and that
do not support any other business purpose or
PO 00000
Frm 00095
Fmt 4703
Sfmt 4703
obtained in these studies also may result
in a significant variation of the
estimated annual PRA burden.
Estimated Number of Respondents:
4,563 financial institutions, as set out in
Table 1.
Estimated Total Annual
Recordkeeping Burden: The estimated
total annual PRA burden is 378,768
hours, as set out in Table 2.
Estimated Total Annual
Recordkeeping Cost: The estimated total
annual PRA cost is $14,014,416, as set
out in Table 5.
An Agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
unless the collection of information
displays a valid OMB control number.
Records required to be retained under
the BSA must be retained for five years.
Part 4—Request for Comments
(a) Specific request for comments on
the traditional annual PRA hourly
burden and cost.
regulatory obligation of the financial institution.
Burden for purposes of the PRA does not include
the time and financial resources needed to comply
with an information collection, if the time and
resources are for things a business (or other person)
does in the ordinary course of its activities if the
agency demonstrates that the reporting activities
needed to comply are usual and customary. 5 CFR
1320.3(b)(2). For example, depending on the nature
of the account or transaction, a financial institution
may be collecting and maintaining some of the
same information on an account or transaction that
is required to be recorded in 31 CFR 1022.410 and
31 CFR 1023.410 in order to satisfy other
obligations. Those obligations may include (i)
protecting the financial institution from fraud
against itself or its customers, (ii) complying with
other non-BSA regulatory requirements such as
those imposed by the specific Federal functional
regulator, or (iii) maintaining proper accounting
information.
E:\FR\FM\01FEN1.SGM
01FEN1
Federal Register / Vol. 86, No. 19 / Monday, February 1, 2021 / Notices
FinCEN invites comments on any
aspect of the traditional annual PRA
burden, as set out in Part 2 of this
notice. In particular, FinCEN seeks
comments on the adequacy of: (i)
FinCEN’s assumptions underlying its
estimate of the burden; (ii) the estimated
number of hours required by each
portion of the burden; and (iii) the
organizational levels of the financial
institution engaged in each portion of
the burden, their estimated hourly
remuneration, and the estimated
proportion of participation by each role.
FinCEN encourages commenters to
include any publicly available sources
for alternative estimates or
methodologies.
(b) Specific request for comments on
the proposed criteria for determining
the scope of a future annual PRA hourly
burden and cost estimate.
FinCEN invites comments on any
aspect of the criteria for a future
estimate of the annual PRA burden, as
set out in Part 3 of this notice.
(c) Specific request for comments on
the appropriate criteria, methodology,
and questionnaire required to obtain
information to more precisely estimate
the future annual PRA hourly burden
and cost.
FinCEN invites comments on the most
appropriate and comprehensive means
to question financial institutions about
the annual hourly burden and cost
attributable solely to the regulations
covered by this notice (i.e., the hourly
burden and cost of complying with the
recordkeeping requirements imposed
exclusively by the BSA, which are not
used to satisfy contractual obligations,
other regulatory requirements, or
business purposes of the financial
institution). The future annual PRA
hourly burden and cost estimate must
take into consideration only the
information collected and recorded that
is used exclusively to comply with
requirements under 31 CFR 1022.410
and 31 CFR 1023.410.
FinCEN seeks comments from the
public regarding any questions we
should consider posing in future
notices, in addition to the specific
questions for comment outlined directly
below. Also, due to the difficulty
involved in estimating the number of
transaction accounts, lines of credit, and
transactions that trigger recordkeeping
requirements, as described in this
notice, FinCEN welcomes any
suggestions as to how to derive these
estimates by using publicly available
financial information.
(d) Specific questions for comment
associated with making and retaining
records required by the regulations
described in this notice:
VerDate Sep<11>2014
16:57 Jan 29, 2021
Jkt 253001
(1) Complying With 31 CFR 1022.410(a)
• On average, how many transaction
accounts or lines of credit does your
dealer in foreign exchange open/extend
annually, which trigger the
recordkeeping requirement in 31 CFR
1022.410(a)?
• On average, how long does it take
your dealer in foreign exchange to
collect and retain the records required
to be maintained when you open a
transaction account or extend a line of
credit?
(2) Complying With 31 CFR 1022.410(b)
• On average, how often does your
dealer in foreign exchange conduct each
of the transactions described in 31 CFR
1022.410(b), as explained in further
detail in Section I—Statutory and
Regulatory Provisions?
• On average, how long does it take
your dealer in foreign exchange to
collect and retain the records required
to be maintained when you conduct one
of the transactions described in 31 CFR
1022.410(b)?
(3) Complying With 31 CFR 1023.410(b)
• On average, how often does your
broker or dealer in securities conduct
each of the transactions described in 31
CFR 1023.410(b), as explained in further
detail in Section I—Statutory and
Regulatory Provisions?
• On average, how long does it take
your broker or dealer in securities to
collect and retain the records required
to be maintained when you conduct one
of the transactions described in 31 CFR
1023.410(b)?
(e) General request for comments.
Comments submitted in response to
this notice will be summarized and/or
included in the request for OMB
approval. All comments will become a
matter of public record. Comments are
invited on: (i) Whether the collection of
information is necessary for the proper
performance of the functions of the
agency, including whether the
information shall have practical utility;
(ii) the accuracy of the agency’s estimate
of the burden of the collection of
information; (iii) ways to enhance the
quality, utility, and clarity of the
information to be collected; (iv) ways to
minimize the burden of the collection of
information on respondents, including
through the use of automated collection
techniques or other forms of information
technology; and (v) estimates of capital
or start-up costs and costs of operation,
PO 00000
Frm 00096
Fmt 4703
Sfmt 9990
7783
maintenance, and purchase of services
to provide information.
Kenneth A. Blanco,
Director, Financial Crimes Enforcement
Network.
[FR Doc. 2021–02064 Filed 1–29–21; 8:45 am]
BILLING CODE 4810–02–P
DEPARTMENT OF THE TREASURY
Internal Revenue Service
Open Meeting of the Taxpayer
Advocacy Panel’s Special Projects
Committee; Change
Internal Revenue Service (IRS),
Treasury.
AGENCY:
ACTION:
Notice of meeting; change.
In the Federal Register notice
that was originally published on January
22, 2021, (Volume 86, Number 13, Page
6740) the time for this meeting has
changed from 1:30 p.m. Eastern Time to
11:00 a.m. Eastern Time. All other
meeting details remain the unchanged.
SUMMARY:
The meeting will be held
Wednesday, February 10, 2021.
DATES:
FOR FURTHER INFORMATION CONTACT:
Antoinette Ross at 1–888–912–1227 or
202–317–4110.
Notice is
hereby given pursuant to Section
10(a)(2) of the Federal Advisory
Committee Act, 5 U.S.C. App. (1988)
that an open meeting of the Taxpayer
Advocacy Panel’s Special Projects
Committee will be held Wednesday,
February 10, 2021, at 11:00 a.m. Eastern
Time. The public is invited to make oral
comments or submit written statements
for consideration. Due to limited time
and structure of meeting, notification of
intent to participate must be made with
Antoinette Ross. For more information
please contact Antoinette Ross at 1–
888–912–1227 or 202–317–4110, or
write TAP Office, 1111 Constitution
Ave. NW, Room 1509, Washington, DC
20224 or contact us at the website:
https://www.improveirs.org. The agenda
will include various IRS issues.
SUPPLEMENTARY INFORMATION:
Dated: January 26, 2021.
Kevin Brown,
Acting Director, Taxpayer Advocacy Panel.
[FR Doc. 2021–02007 Filed 1–29–21; 8:45 am]
BILLING CODE 4830–01–P
E:\FR\FM\01FEN1.SGM
01FEN1
]]>Agencies
[Federal Register Volume 86, Number 19 (Monday, February 1, 2021)]
[Notices]
[Pages 7778-7783]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-02064]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Financial Crimes Enforcement Network
Agency Information Collection Activities; Proposed Renewal;
Comment Request; Renewal Without Change of Regulations Requiring
Additional Records To Be Made and Retained by Dealers in Foreign
Exchange and Additional Records To Be Made and Retained by Brokers or
Dealers in Securities
AGENCY: Financial Crimes Enforcement Network (FinCEN), Treasury.
ACTION: Notice and request for comments.
-----------------------------------------------------------------------
SUMMARY: As part of its continuing effort to reduce paperwork and
respondent burden, FinCEN invites comments on the proposed renewal,
without change, of a currently approved information collections found
in existing Bank Secrecy Act regulations. Specifically, the regulations
require dealers in foreign exchange and brokers or dealers in
securities to secure and maintain a record of the taxpayer
identification number for individuals for whom a transaction or
brokerage account is opened, or for whom a line of credit is extended,
subject to certain exceptions. The regulations also require that the
dealers in foreign exchange and brokers or dealers in securities retain
originals or copies of specified documents relating to account and
transaction records. Although no changes are proposed to the
information collections
[[Page 7779]]
themselves, this request for comments covers a future expansion of the
scope of the annual hourly burden and cost estimate associated with
these regulations. This request for comments is made pursuant to the
Paperwork Reduction Act of 1995.
DATES: Written comments are welcome, and must be received on or before
April 2, 2021
ADDRESSES: Comments may be submitted by any of the following methods:
Federal E-rulemaking Portal: https://www.regulations.gov.
Follow the instructions for submitting comments. Refer to Docket Number
FINCEN-2021-0003 and the specific Office of Management and Budget (OMB)
control numbers 1506-0052 and 1506-0053.
Mail: Policy Division, Financial Crimes Enforcement
Network, P.O. Box 39, Vienna, VA 22183. Refer to Docket Number FINCEN-
2021-0003 and OMB control numbers 1506-0052 and 1506-0053.
Please submit comments by one method only. Comments will also be
taken into account in FinCEN's review of existing regulations,
consistent with by Treasury's 2011 Plan for Retrospective Analysis of
Existing Rules. All comments submitted in response to this notice will
become a matter of public record. Therefore, you should submit only
information that you wish to make publicly available.
FOR FURTHER INFORMATION CONTACT: The FinCEN Regulatory Support Section
at 1-800-767-2825 or electronically at [email protected].
SUPPLEMENTARY INFORMATION:
I. Statutory and Regulatory Provisions
The legislative framework generally referred to as the Bank Secrecy
Act (BSA) consists of the Currency and Financial Transactions Reporting
Act of 1970, as amended by the Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001 (USA PATRIOT Act) (Pub. L. 107-56) and other
legislation. The BSA is codified at 12 U.S.C. 1829b, 12 U.S.C. 1951-
1959, 31 U.S.C. 5311-5314 and 5316-5332, and notes thereto, with
implementing regulations at 31 CFR Chapter X.
The BSA authorizes the Secretary of the Treasury, inter alia, to
require financial institutions to keep records and file reports that
are determined to have a high degree of usefulness in criminal, tax,
and regulatory matters, or in the conduct of intelligence or counter-
intelligence activities to protect against international terrorism, and
to implement anti-money laundering (AML) programs and compliance
procedures.\1\ Regulations implementing the BSA appear at 31 CFR
Chapter X. The authority of the Secretary to administer the BSA has
been delegated to the Director of FinCEN.\2\
---------------------------------------------------------------------------
\1\ Section 358 of the USA PATRIOT Act added language expanding
the scope of the BSA to intelligence or counter-intelligence
activities to protect against international terrorism. Section 6101
of the Anti-Money Laundering Act of 2020 (``the AML Act'') added
language further expanding the scope of the BSA but did not disturb
these longstanding purposes. The AML Act is Division F of Public Law
116-283 (January 1, 2021).
\2\ Treasury Order 180-01 (re-affirmed Jan. 14, 2020).
---------------------------------------------------------------------------
a. 31 CFR 1022.410--Additional Records To Be Made and Retained by
Dealers in Foreign Exchange
31 CFR 1022.410(a) requires a dealer in foreign exchange to make
and maintain a record of the taxpayer identification number of certain
persons for whom a transaction account is opened or a line of credit is
extended, within 30 days of opening such an account or extending such a
line of credit, or longer if the person has applied for a taxpayer
identification or social security number. A dealer in foreign exchange
must also maintain a list containing the names, addresses, and account
or credit line numbers of those persons from whom it has been unable to
secure such information despite reasonable efforts. A dealer in foreign
exchange need not attempt to secure such information if the person is
an agency or instrumentality of a Federal, state, local, or foreign
government using an account for public funds, one of several categories
of aliens that are not permanent resident aliens, or an unincorporated
subordinate unit of a tax exempt organization covered by a group
exemption letter.
Under 31 CFR 1022.410(b), a dealer in foreign exchange must also
retain the original or a copy of nine types of documents: (1)
Statements of accounts from banks, including documents representing the
entries reflected on such statements; (2) daily work records, including
documents needed to identify and reconstruct currency transactions with
customers and foreign banks; (3) a record of each exchange of currency
involving transactions in excess of $1,000, including the customer's
name and address (and passport or tax identification number unless
received by mail or common carrier), the date and amount of the
transaction, and the currency name, country, and total amount of each
foreign currency; (4) signature cards or other documents evidencing
signature authority over each deposit or security account, containing
specified items of information about the customer (including a record
of the actual owner of the account if customer accounts are maintained
in a code name); (5) each item, including checks, drafts, and transfers
of credit, of more than $10,000 remitted or transferred to a person,
account, or place outside the United States; (6) a record of each
receipt of currency, other monetary instruments, investment securities
and checks, and of each transfer of funds or credit, of more than
$10,000 received on any one occasion directly and not through a
domestic financial institution, from any person, account, or place
outside the United States; (7) records prepared or received by the
dealer in foreign exchange in the ordinary course of business that
would be needed to reconstruct an account and trace a check in excess
of $100 deposited in such an account through its internal recordkeeping
system to its depository institution, or to supply a description of
such a deposited check; (8) a record of the name, address and taxpayer
identification number of any person presenting a certificate of deposit
for payment, as well as a description of the instrument and the date of
the transaction; and (9) a system of books and records that enables the
dealer in foreign exchange to prepare an accurate balance sheet and
income statement. To the extent that these records include originals or
copies of checks, drafts, monetary instruments, investment securities,
or other similar instruments, copies of front and back of such
instruments must generally be retained.\3\ The required records must be
maintained for five years.\4\
---------------------------------------------------------------------------
\3\ 31 CFR 1010.430(a).
\4\ 31 CFR 1010.430(d).
---------------------------------------------------------------------------
b. 31 CFR 1023.410--Additional Records To Be Made and Retained by
Brokers or Dealers in Securities
Until October 1, 2003, 31 CFR 1023.410(a) required a broker or
dealer in securities to make a record of certain information. Until
October 1, 2008, a broker or dealer in securities was required to
maintain all such records, as well as a list containing the names,
addresses, and account or credit line numbers of those persons from
whom it had been unable to secure the required information despite
reasonable efforts. The customer identification program requirement for
brokers or dealers in
[[Page 7780]]
securities has effectively superseded these requirements.\5\
---------------------------------------------------------------------------
\5\ 31 CFR 1023.220. The burden associated with these
requirement is calculated under OMB control number 1506-0034.
---------------------------------------------------------------------------
Under 31 CFR 1023.410(b), a broker or dealer in securities must
retain an original or copy of: (1) Each document granting signature or
trading authority over each customer's account; (2) a record of each
remittance or transfer of funds, currency, checks, other monetary
instruments, investment securities, or credit, of more than $10,000 to
a person, account, or place outside the United States; (3) a record of
each receipt of currency, other monetary instruments, investment
securities, or checks, and of each transfer of funds or credit, of more
than $10,000 on any one occasion, not through a domestic financial
institution, from any person, account, or place outside the United
States; and (4) each record described in paragraphs (1), (2), (3), (5),
(6), (7), (8), and (9) of 17 CFR 240.17a-3(a), covering records to be
made by certain exchange members, brokers and dealers as identified in
17 CFR 240.17a-3. To the extent that these records include originals or
copies of checks, drafts, monetary instruments, investment securities,
or other similar instruments, copies of front and back of such
instruments must generally be retained.\6\ The required records must be
maintained for five years.\7\
---------------------------------------------------------------------------
\6\ 31 CFR 1010.430(a).
\7\ 31 CFR 1010.430(d).
---------------------------------------------------------------------------
II. Paperwork Reduction Act of 1995 (PRA) 8
---------------------------------------------------------------------------
\8\ Public Law 104-13, 44 U.S.C. 3506(c)(2)(A).
---------------------------------------------------------------------------
Title: Additional records to be made and retained by dealers in
foreign exchange and additional records to be made and retained by
brokers or dealers in securities (31 CFR 1022.410 and 31 CFR 1023.410).
OMB Control Numbers: 1506-0052 and 1506-0053.
Report Number: Not applicable.
Abstract: FinCEN is issuing this notice to renew the OMB control
numbers for record-keeping requirements for dealers in foreign exchange
and brokers or dealers in securities.
Affected Public: Businesses or other for-profit institutions, and
non-profit institutions.
Type of Review:
Renewal without change of a currently approved information
collection.
Propose for review and comment a renewal of the portion of
the PRA burden that has been subject to notice and comment in the past
(the ``traditional annual PRA burden'').
Propose for review and comment a future expansion of the
scope of the PRA burden (the ``future annual PRA burden'').
Frequency: As required.
Estimated Number of Respondents: 4,563 financial institutions.\9\
---------------------------------------------------------------------------
\9\ Table 1 below sets forth a breakdown of the types of
financial institutions covered by this notice.
---------------------------------------------------------------------------
Estimated Recordkeeping Burden: In Part 1 of this notice, FinCEN
describes the breakdown of the estimated number of financial
institutions, by type, affected by each of the regulatory requirements.
In Part 2, FinCEN proposes for review and comment a renewal of the
estimate of the traditional annual PRA hourly burden, which includes an
annual hourly burden estimate per financial institution similar to that
used in the past, with the incorporation of a more robust cost
estimate. The scope and methodology used in the past assigned a total
annual hourly burden estimate, per financial institution, to multiple
recordkeeping requirements within the regulations. In Part 3, FinCEN
proposes for review and comment a methodology to estimate the hourly
burden and the cost of a future estimate of an annual PRA burden that
includes the burden and cost broken down by each unique type of
recordkeeping requirement covered by the regulations being renewed. The
methodology also includes identifying estimates for the number of
transactions conducted annually, per financial institution, which would
trigger each unique recordkeeping requirement. Finally, in Part 4,
FinCEN solicits input from the public about: (a) The accuracy of the
estimate of the traditional annual PRA burden; (b) the method proposed
to be more granular in the calculation of burden per unique
recordkeeping requirement, within the regulations, to establish a
future annual PRA burden; (c) the criteria, metrics, and most
appropriate questions FinCEN should consider when researching the
information to estimate the future annual PRA burden, according to the
methodology proposed; and (d) any other comments about the regulations
and the current and proposed future hourly burden and cost estimates of
these requirements.
Part 1. Breakdown of the Financial Institutions Covered by This Notice
The breakdown of financial institutions, by type, covered by this
notice is reflected in Table 1 below:
Table 1--Breakdown of Financial Institutions Covered by This Notice, by
Type of Financial Institution
------------------------------------------------------------------------
Number of financial
Type of financial institution institutions
------------------------------------------------------------------------
Dealers in foreign exchange............... 10 923
Brokers or dealers in securities.......... 11 3,640
-----------------------------
Total number of financial institutions.. 4,563
------------------------------------------------------------------------
Part 2. Traditional Annual PRA Burden and Cost
---------------------------------------------------------------------------
\10\ This number is derived from self-reported information in
MSB registrations submitted to FinCEN. FinCEN's MSB registration
database is available at https://www.fincen.gov/msb-state-selector.
\11\ According to the Securities and Exchange Commission (SEC),
there were 3,640 brokers or dealers in securities registered with
the SEC, as of March 31, 2020.
---------------------------------------------------------------------------
OMB Control Number 1506-0052
31 CFR 1022.410(a)
Each dealer in foreign exchange must make and maintain a record of
the taxpayer identification number of certain persons for whom a
transaction account is opened or a line of credit is extended within 30
days of opening such an account or extending such a line of credit, or
longer if the person has applied for a taxpayer identification or
social security number. A dealer in foreign exchange must also maintain
a list containing the names, addresses, and account or credit line
numbers of those persons from whom it has been unable to secure such
information despite reasonable efforts.
31 CFR 1022.410(b)
Each dealer in foreign exchange must retain the original or a copy
of nine types of documents as described in
[[Page 7781]]
Section I--Statutory and Regulatory Provisions above.
Due to the challenges of obtaining the total number of such records
required to be maintained by dealers in foreign exchange under 31 CFR
1022.410, in its most recent control number renewal, FinCEN estimated
that the annual recordkeeping burden per dealer in foreign exchange for
these requirements was 16 hours.\12\ FinCEN continues to estimate that
the annual hourly burden of complying with 31 CFR 1022.410 is 16 hours
per dealer in foreign exchange.
---------------------------------------------------------------------------
\12\ 82 FR 31686, 31687 (July 7, 2017).
---------------------------------------------------------------------------
923 dealers in foreign exchange \13\ multiplied by 16 hours,
results in a total annual hourly burden estimate of 14,768 hours.
---------------------------------------------------------------------------
\13\ See Table 1, supra.
---------------------------------------------------------------------------
OMB Control Number 1506-0053
31 CFR 1023.410(a)
As noted above, brokers or dealers in securities have no
recordkeeping responsibilities under this provision; the obligation on
brokers or dealers in securities to maintain customer identification
programs pursuant to 31 CFR 1023.220 has effectively replaced these
responsibilities.
31 CFR 1023.410(b)
Each broker or dealer in securities must retain an original or copy
of certain types of documents as described in Section I--Statutory and
Regulatory Provisions above.
Due to the challenges of obtaining the total number of such records
required to be maintained by brokers or dealers in securities, in its
most recent control number renewal, FinCEN estimated that the annual
recordkeeping burden per broker or dealer in securities for these
requirements was 100 hours.\14\ FinCEN continues to estimate that the
annual hourly burden of complying with 31 CFR 1023.410 is 100 hours per
broker or dealer in securities.
---------------------------------------------------------------------------
\14\ 82 FR 31686, 31687 (July 7, 2017).
---------------------------------------------------------------------------
3,640 brokers or dealers in securities \15\ multiplied by 100
hours, results in a total annual hourly burden estimate of 364,000
hours.
---------------------------------------------------------------------------
\15\ See Table 1, supra.
---------------------------------------------------------------------------
Total Annual Traditional PRA Hourly Burden for OMB Control Numbers
1506-0052 and 1506-0053
FinCEN's estimate of the traditional annual PRA burden, therefore,
is 378,768 hours, as detailed in Table 2 below:
Table 2--Breakdown of Financial Institutions Impacted by Each Regulatory Requirement, and the Estimated Total
Annual Burden Hours per Requirement
----------------------------------------------------------------------------------------------------------------
Traditional
annual burden Total annual
Type of financial Number of estimate per burden hours
Regulatory requirement institution impacted by financial financial per regulatory
the requirement institutions institution requirement
(hours)
----------------------------------------------------------------------------------------------------------------
31 CFR 1022.410--OMB Control Number Dealers in foreign 923 16 14,768
1506-0052. exchange.
31 CFR 1023.410--OMB Control Number Brokers or dealers in 3,640 100 364,000
1506-0053. securities.
-----------------------------------------------
Total annual hour burden hours.... ........................ .............. .............. 378,768
----------------------------------------------------------------------------------------------------------------
To calculate the hourly costs of the burden estimate, FinCEN
identified three roles and corresponding staff positions involved in
maintaining records as required by 31 CFR 1022.410 and 1023.410: (i)
General supervision (providing process oversight); (ii) direct
supervision (reviewing operational-level work and cross-checking all or
a sample of the work product against supporting documentation); and
(iii) clerical work (engaging in recordkeeping).
FinCEN calculated the fully-loaded hourly wage for each of these
three roles by using the median wage estimated by the U.S. Bureau of
Labor Statistics (BLS),\16\ and computing an additional benefits cost
as follows:
---------------------------------------------------------------------------
\16\ The U.S. Bureau of Labor Statistics, Occupational
Employment Statistics-National, May 2019, available at https://www.bls.gov/oes/tables.htm. The most recent data from the BLS
corresponds to May 2019. For the benefits component of total
compensation, see U.S. Bureau of Labor Statistics, Employer's Cost
per Employee Compensation as of December 2019, available at https://www.bls.gov/news.release/ecec.nr0.htm. The ratio between benefits
and wages for financial activities is $15.95 (hourly benefits)/
$32.05 (hourly wages) = 0.50. The benefit factor is 1 plus the
benefit/wages ratio, or 1.50. Multiplying each hourly wage by the
benefit factor produces the fully-loaded hourly wage per position.
Table 3--Fully-Loaded Hourly Wage by Role and BLS Job Position for All Financial Institutions Covered by This
Notice
----------------------------------------------------------------------------------------------------------------
Median hourly Fully-loaded
Role BLS-code BLS-name wage Benefit factor hourly wage
----------------------------------------------------------------------------------------------------------------
General supervision........... 11-3031 Financial $62.45 1.50 $93.68
Manager.
Direct supervision............ 13-1041 Compliance 33.20 1.50 49.80
Officer.
Clerical work (research, 43-3099 Financial Clerk. 20.40 1.50 30.60
review, and recordkeeping).
----------------------------------------------------------------------------------------------------------------
FinCEN estimates that, in general and on average,\17\ each role
would spend different amounts of time on each portion of the
traditional annual PRA burden, as follows:
---------------------------------------------------------------------------
\17\ By ``in general,'' FinCEN means without regard to outliers
(e.g., financial institutions with accounts or transactions that
require recordkeeping that is uncommonly higher or lower than those
of the population at large). By ``on average,'' FinCEN means the
mean of the distribution of each subset of the population.
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The cost of each hour of burden, broken down by role, to produce
and maintain records as outlined in 31 CFR
[[Page 7782]]
1022.410 and 31 CFR 1023.410 would be $37.00 as set out in Table 4
below:
Table 4--Weighted Average Hourly Cost of Making and Retaining the Records
----------------------------------------------------------------------------------------------------------------
General supervision Direct supervision Clerical work
--------------------------------------------------------------------------------------------- Weighted average
Hourly Hourly Hourly hourly cost
% Time cost % Time cost % Time cost
----------------------------------------------------------------------------------------------------------------
5% $4.68 15 $7.47 80 $24.48 $37.00
----------------------------------------------------------------------------------------------------------------
$36.63 rounded to $37.00.
The total estimated cost of the traditional annual PRA burden is
$14,014,416, as reflected in Table 5 below:
Table 5--Total Cost of Traditional Annual PRA Burden
----------------------------------------------------------------------------------------------------------------
OMB control No./regulation Hourly burden Hourly cost Total cost
----------------------------------------------------------------------------------------------------------------
1506-0052 (31 CFR 1022.410)..................................... 14,768 $37 $546,416
1506-0053 (31 CFR 1023.410)..................................... 364,000 37 13,468,000
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Total cost.................................................. .............. .............. 14,014,416
----------------------------------------------------------------------------------------------------------------
Part 3. Future Annual PRA Burden
In the future, FinCEN will include the burden and cost for each
type of recordkeeping requirement covered by the regulations being
renewed. The future burden estimate will also include estimates of the
number of transactions conducted annually per financial institution,
which trigger each recordkeeping requirement.
31 CFR 1022.410(a)
Each dealer in foreign exchange must make and maintain a record of
the taxpayer identification number of certain persons for whom a
transaction account is opened or a line of credit is extended within 30
days of opening such an account or extending such a line of credit, or
longer if the person has applied for a taxpayer identification or
social security number. A dealer in foreign exchange must also maintain
a list containing the names, addresses, and account or credit line
numbers of those persons from whom it has been unable to secure such
information despite reasonable efforts. In order to more accurately
estimate the related PRA burden in the future, FinCEN intends to obtain
a better understanding of the volume of transaction accounts and lines
of credit opened per year by dealers in foreign exchange.
31 CFR 1022.410(b)
As described in greater detail in Section I--Statutory and
Regulatory Provisions above, each dealer in foreign exchange must
retain the original or a copy of nine types of documents. In order to
more accurately estimate the related PRA burden in the future, FinCEN
intends to obtain a better understanding of the volume of transactions
that trigger such recordkeeping requirements per year by dealers in
foreign exchange.
31 CFR 1023.410(b)
Each broker or dealer in securities must retain an original or copy
of certain types of documents as described in Section I--Statutory and
Regulatory Provisions above. In order to more accurately estimate the
related PRA burden in the future, FinCEN intends to obtain a better
understanding of the volume of transactions that trigger such
recordkeeping requirements per year by brokers or dealers in exchange.
FinCEN does not have the information needed to estimate the number
of annual transactions that trigger each recordkeeping requirement
being renewed in this notice. For that reason, FinCEN is relying on
estimates used in prior renewals of these OMB control numbers and the
applicable regulations. FinCEN further recognizes that after receiving
public comments as a result of this notice, future annual PRA hourly
burden and cost estimates may vary significantly. In order to arrive at
more precise estimates of net BSA hourly burden and cost, FinCEN
intends to conduct more granular studies in the near future, regarding
the types and volume of transactions conducted annually, which trigger
each recordkeeping requirement, and the time it takes to collect and
record the information required for each recordkeeping requirement.\18\
The data obtained in these studies also may result in a significant
variation of the estimated annual PRA burden.
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\18\ Net hourly burden and cost are the burden and cost a
financial institution incurs to comply with requirements that are
unique to the BSA, and that do not support any other business
purpose or regulatory obligation of the financial institution.
Burden for purposes of the PRA does not include the time and
financial resources needed to comply with an information collection,
if the time and resources are for things a business (or other
person) does in the ordinary course of its activities if the agency
demonstrates that the reporting activities needed to comply are
usual and customary. 5 CFR 1320.3(b)(2). For example, depending on
the nature of the account or transaction, a financial institution
may be collecting and maintaining some of the same information on an
account or transaction that is required to be recorded in 31 CFR
1022.410 and 31 CFR 1023.410 in order to satisfy other obligations.
Those obligations may include (i) protecting the financial
institution from fraud against itself or its customers, (ii)
complying with other non-BSA regulatory requirements such as those
imposed by the specific Federal functional regulator, or (iii)
maintaining proper accounting information.
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Estimated Number of Respondents: 4,563 financial institutions, as
set out in Table 1.
Estimated Total Annual Recordkeeping Burden: The estimated total
annual PRA burden is 378,768 hours, as set out in Table 2.
Estimated Total Annual Recordkeeping Cost: The estimated total
annual PRA cost is $14,014,416, as set out in Table 5.
An Agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information unless the collection of
information displays a valid OMB control number. Records required to be
retained under the BSA must be retained for five years.
Part 4--Request for Comments
(a) Specific request for comments on the traditional annual PRA
hourly burden and cost.
[[Page 7783]]
FinCEN invites comments on any aspect of the traditional annual PRA
burden, as set out in Part 2 of this notice. In particular, FinCEN
seeks comments on the adequacy of: (i) FinCEN's assumptions underlying
its estimate of the burden; (ii) the estimated number of hours required
by each portion of the burden; and (iii) the organizational levels of
the financial institution engaged in each portion of the burden, their
estimated hourly remuneration, and the estimated proportion of
participation by each role. FinCEN encourages commenters to include any
publicly available sources for alternative estimates or methodologies.
(b) Specific request for comments on the proposed criteria for
determining the scope of a future annual PRA hourly burden and cost
estimate.
FinCEN invites comments on any aspect of the criteria for a future
estimate of the annual PRA burden, as set out in Part 3 of this notice.
(c) Specific request for comments on the appropriate criteria,
methodology, and questionnaire required to obtain information to more
precisely estimate the future annual PRA hourly burden and cost.
FinCEN invites comments on the most appropriate and comprehensive
means to question financial institutions about the annual hourly burden
and cost attributable solely to the regulations covered by this notice
(i.e., the hourly burden and cost of complying with the recordkeeping
requirements imposed exclusively by the BSA, which are not used to
satisfy contractual obligations, other regulatory requirements, or
business purposes of the financial institution). The future annual PRA
hourly burden and cost estimate must take into consideration only the
information collected and recorded that is used exclusively to comply
with requirements under 31 CFR 1022.410 and 31 CFR 1023.410.
FinCEN seeks comments from the public regarding any questions we
should consider posing in future notices, in addition to the specific
questions for comment outlined directly below. Also, due to the
difficulty involved in estimating the number of transaction accounts,
lines of credit, and transactions that trigger recordkeeping
requirements, as described in this notice, FinCEN welcomes any
suggestions as to how to derive these estimates by using publicly
available financial information.
(d) Specific questions for comment associated with making and
retaining records required by the regulations described in this notice:
(1) Complying With 31 CFR 1022.410(a)
On average, how many transaction accounts or lines of
credit does your dealer in foreign exchange open/extend annually, which
trigger the recordkeeping requirement in 31 CFR 1022.410(a)?
On average, how long does it take your dealer in foreign
exchange to collect and retain the records required to be maintained
when you open a transaction account or extend a line of credit?
(2) Complying With 31 CFR 1022.410(b)
On average, how often does your dealer in foreign exchange
conduct each of the transactions described in 31 CFR 1022.410(b), as
explained in further detail in Section I--Statutory and Regulatory
Provisions?
On average, how long does it take your dealer in foreign
exchange to collect and retain the records required to be maintained
when you conduct one of the transactions described in 31 CFR
1022.410(b)?
(3) Complying With 31 CFR 1023.410(b)
On average, how often does your broker or dealer in
securities conduct each of the transactions described in 31 CFR
1023.410(b), as explained in further detail in Section I--Statutory and
Regulatory Provisions?
On average, how long does it take your broker or dealer in
securities to collect and retain the records required to be maintained
when you conduct one of the transactions described in 31 CFR
1023.410(b)?
(e) General request for comments.
Comments submitted in response to this notice will be summarized
and/or included in the request for OMB approval. All comments will
become a matter of public record. Comments are invited on: (i) Whether
the collection of information is necessary for the proper performance
of the functions of the agency, including whether the information shall
have practical utility; (ii) the accuracy of the agency's estimate of
the burden of the collection of information; (iii) ways to enhance the
quality, utility, and clarity of the information to be collected; (iv)
ways to minimize the burden of the collection of information on
respondents, including through the use of automated collection
techniques or other forms of information technology; and (v) estimates
of capital or start-up costs and costs of operation, maintenance, and
purchase of services to provide information.
Kenneth A. Blanco,
Director, Financial Crimes Enforcement Network.
[FR Doc. 2021-02064 Filed 1-29-21; 8:45 am]
BILLING CODE 4810-02-P
