Annual Adjustment of Civil Monetary Penalties To Reflect Inflation-2024, 4542-4545 [2024-01341]
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Federal Register / Vol. 89, No. 16 / Wednesday, January 24, 2024 / Rules and Regulations
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[FR Doc. 2024–01086 Filed 1–23–24; 8:45 am]
BILLING CODE 6325–39–P
COMMODITY FUTURES TRADING
COMMISSION
17 CFR Part 143
RIN 3038–AF32
Annual Adjustment of Civil Monetary
Penalties To Reflect Inflation—2024
Commodity Futures Trading
Commission.
ACTION: Final rule.
AGENCY:
The Commodity Futures
Trading Commission (Commission) is
amending its rule that governs the
maximum amount of civil monetary
penalties imposed under the
Commodity Exchange Act (CEA), to
adjust for inflation. This rule sets forth
the maximum, inflation-adjusted dollar
amount for civil monetary penalties
(CMPs) assessable for violations of the
CEA and Commission rules, regulations
and orders thereunder. The rule, as
amended, implements the Federal Civil
ddrumheller on DSK120RN23PROD with RULES1
SUMMARY:
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Penalties Inflation Adjustment Act of
1990, as amended.
DATES: This rule is effective on January
24, 2024 and is applicable to penalties
assessed after January 15, 2024.
FOR FURTHER INFORMATION CONTACT:
Edward J. Riccobene, Associate Chief
Counsel, Division of Enforcement, at
(202) 418–5327 or ericcobene@cftc.gov,
Commodity Futures Trading
Commission, 1155 21st Street NW,
Washington, DC 20581.
SUPPLEMENTARY INFORMATION:
I. Background
The Federal Civil Penalties Inflation
Adjustment Act of 1990 (FCPIAA) 1
requires the head of each Federal agency
to periodically adjust for inflation the
minimum and maximum amount of
CMPs provided by law within the
jurisdiction of that agency.2 A 2015
1 The FCPIAA, Public Law 101–410 (1990), as
amended, is codified at 28 U.S.C. 2461 note. The
FCPIAA states that the purpose of the FCPIAA is
to establish a mechanism that shall (1) allow for
regular adjustment for inflation of civil monetary
penalties; (2) maintain the deterrent effect of civil
monetary penalties and promote compliance with
the law; and (3) improve the collection by the
Federal Government of civil monetary penalties.
2 For the relevant CMPs within the Commission’s
jurisdiction, the Act provides only for maximum
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amendment to the FCPIAA 3 required
agencies to make an initial ‘‘catch-up’’
adjustment to its civil monetary
penalties effective no later than August
1, 2016.4 For every year thereafter
effective not later than January 15th, the
FCPIAA, as amended, requires agencies
to make annual adjustments for
inflation, with guidance from the
Director of the Office of Management
and Budget.5
II. Commodity Exchange Act Civil
Monetary Penalties
The following sections of the CEA
provide for CMPs that meet the FCPIAA
amounts that can be assessed for each violation of
the Act or the rules, regulations and orders
promulgated thereunder; the Act does not set forth
any minimum penalties. Therefore, the remainder
of this release will refer only to CMP maximums.
3 Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015, Public Law 114–74, 129
Stat. 584 (2015) (2015 Act), title VII, Section 701.
4 FCPIAA Sections 4 and 5. See also, Adjustment
of Civil Monetary Penalties for Inflation, 81 FR
41435 (June 27, 2016).
5 FCPIAA Sections 4 and 5. See also, Executive
Office of the President, Office of Management and
Budget Memorandum, M–24–07, Implementation of
Penalty Inflation Adjustments for 2024 (Dec. 19,
2023) (2023 OMB Guidance) (https://
www.whitehouse.gov/wp-content/uploads/2023/12/
M-24-07-Implementation-of-Penalty-InflationAdjustments-for-2024.pdf).
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4543
Federal Register / Vol. 89, No. 16 / Wednesday, January 24, 2024 / Rules and Regulations
definition 6 and these CMPs are,
therefore, subject to the inflation
adjustment: Sections 6(c), 6b, and 6c of
the CEA.7
III. Annual Inflation Adjustment for
Commodity Exchange Act Civil
Monetary Penalties
A. Methodology
The FCPIAA annual inflation
adjustment, in the context of the CFTC’s
CMPs, is determined by increasing the
maximum penalty by a ‘‘cost-of-living
adjustment’’, rounded to the nearest
multiple of one dollar.8 Annual
inflation adjustments are based on the
percent change between the October
Consumer Price Index for all Urban
Consumers (CPI–U) preceding the date
of the adjustment, and the prior year’s
October CPI–U.9 In this case, the
October 2023 CPI–U (307.671)/October
2022 CPI–U (298.012) = 1.03241.10 In
order to complete the 2024 annual
adjustment, the CFTC must multiply
each of its most recent CMP amounts by
the multiplier, 1.03241, and round to
the nearest dollar.11
B. Civil Monetary Penalty Adjustments
Applying the FCPIAA annual
inflation adjustment methodology
results in the following amended CMPs:
Violations occurring on or after 11/02/2015
U.S. Code citation
Civil monetary penalty description
Penalty amount
in 2023
final rule 12
CPI–U
multiplier
New adjusted
penalty amount
Civil Monetary Penalty Imposed by the Commission in an Administrative Action
7 U.S.C. 9 (Section 6(c) of the
Commodity Exchange Act).
7 U.S.C. 13a (Section 6b of
the Commodity Exchange
Act).
For any person other than a registered entity1.
For any person other than a registered entity 1.
For a registered entity 1 or any of its
directors, officers or employees.
Other Than Manipulation or Attempted Manipulation.
Manipulation or Attempted Manipulation.
Other Than Manipulation or Attempted Manipulation.
For a registered entity 1 or any of its
directors, officers or employees.
Manipulation or Attempted Manipulation.
$194,710
1.03241
$201,021
1,404,520
1.03241
1,450,040
1,072,570
1.03241
1,107,332
1,404,520
1.03241
1,450,040
214,514
1.03241
221,466
1,404,520
1.03241
1,450,040
Civil Monetary Penalty Imposed by a Federal District Court in a Civil Injunctive Action
7 U.S.C. 13a–1 (Section 6c of
the Commodity Exchange
Act).
1 The
Any Person .........................................
Other Than Manipulation or Attempted Manipulation.
Any Person .........................................
Manipulation or Attempted Manipulation.
term ‘‘Registered Entity’’ is defined in 7 U.S.C. 1a (Section 1a of the Commodity Exchange Act).
adjustments.14 This means that the
public procedure the APA generally
requires—notice, an opportunity for
comment, and a delay in effective
date—is not required for agencies to
issue regulations implementing the
annual adjustment.15 The Commission
further notes that the notice and
comment procedures of the APA do not
apply to this rulemaking because the
Commission is acting herein pursuant to
statutory language that mandates that
the Commission act in a
nondiscretionary matter.16
IV. Administrative Compliance
The Regulatory Flexibility Act 17
requires agencies with rulemaking
authority to consider the impact of
certain of their rules on small
businesses. A regulatory flexibility
analysis is only required for rules for
which the agency publishes a general
The Paperwork Reduction Act of 1995
(PRA),19 which imposes certain
requirements on Federal agencies,
including the Commission, in
connection with their conducting or
sponsoring any collection of
information as defined by the PRA, does
not apply to this rule. This rule
amendment does not contain
information collection requirements that
this information, go to the Consumer Price Index
Home Page at: https://www.bls.gov/cpi/. Click the
‘‘CPI Data/Databases’’ heading, and select ‘‘All
Urban Consumers (Current Series)’’, ‘‘Top Picks.’’
Then check the box for ‘‘U.S. city average, All
items—CUUR0000SA0’’, and click the ‘‘Retrieve
data’’ button.
11 FCPIAA Section 5(a). See also, 2023 OMB
Guidance at 1.
12 Annual Adjustment of Civil Monetary Penalties
to Reflect Inflation—2023, 88 FR 1501 (Jan. 11,
2023); https://www.cftc.gov/sites/default/files/2023/
01/2023-00396a.pdf.
13 FCPIAA Section 6.
14 FCPIAA Section 4(b)(2).
15 2023 OMB Guidance at 3–4.
16 Lake Carriers’ Ass’n v. E.P.A., 652 F.3d 1, 10
(D.C. Cir. 2011).
17 5 U.S.C. 601–612.
18 5 U.S.C. 603(a).
19 44 U.S.C. 3507(d).
A. Notice Requirement
The FCPIAA specifically exempted
from the Administrative Procedure Act
(APA) the rulemakings required to
implement annual inflation
6 FCPIAA
ddrumheller on DSK120RN23PROD with RULES1
notice of proposed rulemaking pursuant
to section 553(b) or any other law.18
Because, as discussed above, the
Commission is not obligated by section
553(b) or any other law to publish a
general notice of proposed rulemaking
with respect to the revisions being made
to Rule 143.8, the Commission
additionally is not obligated to conduct
a regulatory flexibility analysis.
The FCPIAA provides that any
increase under the FCPIAA in a civil
monetary penalty shall apply only to
civil monetary penalties, including
those whose associated violation
predated such increase, which are
assessed after the date the increase takes
effect.13 Thus, the new CMP amounts
established by this rulemaking shall
apply to penalties assessed after January
15, 2024, for violations that occurred on
or after November 2, 2015, the effective
date of the FCPIAA amendment
requiring annual adjustments, the 2015
Act.
Section 3(2).
U.S.C. 9, 13a–1, 13b. Criminal authorities may
also seek fines for criminal violations of the CEA
(see 7 U.S.C. 13, 13(c), 13(d), 13(e), and 13b). The
FCPIA does not affect the amounts of these criminal
penalties.
8 FCPIAA Sections 4 and 5.
9 FCPIAA Section 5(b)(1).
10 The CPI–U is published by the Department of
Labor. Interested parties may find the relevant
Consumer Price Index on the internet. To access
77
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B. Regulatory Flexibility Act
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C. Paperwork Reduction Act
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4544
Federal Register / Vol. 89, No. 16 / Wednesday, January 24, 2024 / Rules and Regulations
require the approval of the Office of
Management and Budget.
D. Consideration of Costs and Benefits
Section 15(a) of the CEA 20 requires
the Commission to consider the costs
and benefits of its action before issuing
a new regulation. Section 15(a) of the
CEA further specifies that costs and
benefits shall be evaluated in light of
five broad areas of market and public
concern: (1) protection of market
participants and the public; (2)
efficiency, competitiveness, and
financial integrity of futures markets; (3)
price discovery; (4) sound risk
management practices; and (5) other
public interest considerations.
The Commission believes that
benefits of this rulemaking greatly
outweigh the costs, if any. As the
Commission understands, the statutory
provisions by which it is making cost-
of-living adjustments to the CMPs in
Rule 143.8 were enacted to ensure that
CMPs do not lose their deterrence value
because of inflation. An analysis of the
costs and benefits of these adjustments
were made before enactment of the
statutory provisions under which the
Commission is operating, and limit the
discretion of the Commission to the
extent that there are no regulatory
choices the Commission could make
that would supersede the pre-enactment
analysis with respect to the five factors
enumerated in Section 15(a) of the CEA,
or any other factors.
PART 143—COLLECTION OF CLAIMS
OWED THE UNITED STATES ARISING
FROM ACTIVITIES UNDER THE
COMMISSION’S JURISDICTION
1. The authority citation for part 143
continues to read as follows:
■
Authority: 7 U.S.C. 9, 9a, 12a(5), 13a, 13a–
1(d), 13(a), 13b; 31 U.S.C. 3701–3720E; 28
U.S.C. 2461 note.
2. Amend § 143.8 by revising
paragraph (b) to read as follows:
■
§ 143.8 Inflation-adjusted civil monetary
penalties.
*
List of Subjects in 17 CFR Part 143
Claims, Penalties.
For the reasons set forth in the
preamble, the Commodity Futures
Trading Commission amends part 143 of
chapter I of title 17 of the Code of
Federal Regulations as follows:
*
*
*
*
(b) 2024 Inflation adjustment. The
maximum amount of each civil
monetary penalty in the following
charts applies to penalties assessed after
January 15, 2024:
(1) For violations, other manipulation,
or attempted manipulation:
TABLE 1 TO PARAGRAPH (b)(1)
Date of violation and corresponding penalty
U.S. Code citation
Civil monetary penalty description
10/23/2004
through
10/22/2008
I
10/23/2008
through
10/22/2012
I
10/23/2012
through
11/01/2015
I
11/02/2015
to present
Civil Monetary Penalty Imposed by the Commission in an Administrative Action
7 U.S.C. 9 (Section 6(c) of the Commodity Exchange Act).
7 U.S.C. 13a (Section 6b of the Commodity Exchange Act).
For any person other than a registered entity 1 ....
entity 1
For a registered
or any of its directors, officers or employees.
$130,000
$140,000
$140,000
$201,021
625,000
675,000
700,000
1,107,332
140,000
221,466
Civil Monetary Penalty Imposed by a Federal District Court in a Civil Injunctive Action
7 U.S.C. 13a–1 (Section 6c of the Commodity
Exchange Act).
1 The
Any Person ...........................................................
130,000
140,000
term ‘‘Registered Entity’’ is defined in 7 U.S.C. 1a (Section 1a of the Commodity Exchange Act).
(2) For manipulation or attempted
manipulation violations:
TABLE 2 TO PARAGRAPH (b)(2)
Date of violation and corresponding penalty
U.S. Code citation
Civil monetary penalty description
10/23/2004
through
05/21/2008
I
05/22/2008
through
08/14/2011
I
08/15/2011
through
11/01/2015
I
11/02/2015
to present
Civil Monetary Penalty Imposed by the Commission in an Administrative Action
7 U.S.C. 9 (Section 6(c) of the Commodity Exchange Act).
7 U.S.C. 13a (Section 6b of the Commodity Exchange Act).
For any person other than a registered entity 1 ....
$130,000
$1,000,000
$1,025,000
$1,450,040
For a registered entity 1 or any of its directors, officers or employees.
625,000
1,000,000
1,025,000
1,450,040
1,025,000
1,450,040
Civil Monetary Penalty Imposed by a Federal District Court in a Civil Injunctive Action
ddrumheller on DSK120RN23PROD with RULES1
7 U.S.C. 13a–1 (Section 6c of the Commodity
Exchange Act).
1 The
20 7
Any Person ...........................................................
130,000
1,000,000
term ‘‘Registered Entity’’ is defined in 7 U.S.C. 1a (Section 1a of the Commodity Exchange Act).
U.S.C. 19(a).
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Federal Register / Vol. 89, No. 16 / Wednesday, January 24, 2024 / Rules and Regulations
Issued in Washington, DC, on January 19,
2024, by the Commission.
Robert Sidman,
Deputy Secretary of the Commission.
Note: The following appendix will not
appear in the Code of Federal Regulations.
Appendix to Annual Adjustment of
Civil Monetary Penalties To Reflect
Inflation—2024—Commission Voting
Summary
On this matter, Chairman Behnam and
Commissioners Johnson, Goldsmith Romero,
Mersinger, and Pham voted in the
affirmative. No Commissioner voted in the
negative.
[FR Doc. 2024–01341 Filed 1–23–24; 8:45 am]
BILLING CODE 6351–01–P
SECURITIES AND EXCHANGE
COMMISSION
17 CFR Part 232
[Release Nos. 33–11259; 34–99193; 39–
2553; IC–35068]
Adoption of Updated EDGAR Filer
Manual
Securities and Exchange
Commission.
ACTION: Final rule.
AGENCY:
The Securities and Exchange
Commission (‘‘Commission’’) is
adopting amendments to Volume II of
the Electronic Data Gathering, Analysis,
and Retrieval system Filer Manual
(‘‘EDGAR Filer Manual’’ or ‘‘Filer
Manual’’) and related rules and forms.
EDGAR Release 23.4 will be deployed in
the EDGAR system on December 18,
2023.
DATES: Effective date: January 24, 2024.
Incorporation by reference: The
incorporation by reference of the revised
Filer Manual is approved by the
Director of the Federal Register as of
January 24, 2024.
FOR FURTHER INFORMATION CONTACT: For
questions regarding the amendments to
Volume II of the Filer Manual, please
contact Rosemary Filou, Deputy
Director and Chief Counsel, Jane
Patterson, Senior Special Counsel, or
Lidian Pereira, Senior Special Counsel,
in the EDGAR Business Office at (202)
551–3900. For questions regarding new
Item 1.05 in Forms 8–K, 8–K12B, 8–
K12G3, 8–K15D5, 8–K/A, 8–K12B/A, 8–
K12G3/A, and 8–K15D/A, please
contact Nabeel Cheema, Senior Counsel,
in the Division of Corporation Finance
at (202) 551–5512. For questions
regarding updates to disclosures in
Schedules 13D and 13G related to
beneficial ownership or interests in
ddrumheller on DSK120RN23PROD with RULES1
SUMMARY:
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17:27 Jan 23, 2024
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security-based swaps, please contact
Nicholas Panos, Senior Special Counsel,
or Valian Afshar, Senior Special
Counsel, in the Division of Corporation
Finance at (202) 551–3440. For
questions regarding new tagging
requirements for Forms N–8B–2 and S–
6, please contact Heather Fernandez,
Financial Analyst, in the Division of
Investment Management at (202) 551–
6708. For questions concerning
taxonomies or schemas, please contact
the Office of Structured Disclosure in
the Division of Economic and Risk
Analysis at (202) 551–5494.
SUPPLEMENTARY INFORMATION: We are
adopting an updated Filer Manual,
Volume II: ‘‘EDGAR Filing,’’ Version 68
(December 2023) and amendments to 17
CFR 232.301 (‘‘Rule 301’’). The updated
Filer Manual is incorporated by
reference into the Code of Federal
Regulations.
I. Background
The Filer Manual contains
information needed for filers to make
submissions on EDGAR. Filers must
comply with the applicable provisions
of the Filer Manual in order to assure
the timely acceptance and processing of
filings made in electronic format.1 Filers
must consult the Filer Manual in
conjunction with our rules governing
mandated electronic filings when
preparing documents for electronic
submission.
II. EDGAR System Changes and
Associated Modifications to Volume II
of the Filer Manual
EDGAR is being updated in EDGAR
Release 23.4, and corresponding
amendments to Volume II of the Filer
Manual are being made to reflect these
changes, as described below.2
Public Company Cybersecurity Incident
Disclosure
On July 26, 2023, the Commission
adopted new rules to enhance and
standardize disclosures regarding
cybersecurity risk management, strategy,
governance, and incidents by public
companies that are subject to the
reporting requirements of the Securities
Exchange Act of 1934.3 The new rules
require registrants to disclose material
cybersecurity incidents on new Item
1.05 of Forms 8–K, 8–K12B, 8–K12G3,
8–K15D5, 8–K/A, 8–K12B/A, 8–K12G3/
A, and 8–K15D/A, and describe certain
Rule 301 of Regulation S–T.
Release 23.4 will be deployed on
[December 18, 2023].
3 Cybersecurity Risk Management, Strategy,
Governance, and Incident Disclosure, Release No.
33–11216 (July 26, 2023) [88 FR 51896 (Aug. 4,
2023)].
4545
aspects of the incident’s nature, scope,
and timing, as well as its material
impact or reasonably likely material
impact on the registrant, within four
business days after a registrant
determines the cybersecurity incident is
material. EDGAR will be modified to
add new Item 1.05 to the relevant forms
to allow registrants to disclose the
required information.
Rule Amendments Modernizing
Beneficial Ownership Reporting
On October 10, 2023, the Commission
adopted amendments to certain rules
that govern beneficial ownership
reporting. These rule revisions both
shorten filing deadlines for initial and
amended reports and require that all
information disclosed within the
reports, excluding exhibits, be filed
using structured, machine-readable
language.4 To the extent that a
beneficial owner wishes to submit an
amendment to a Schedule 13D on
EDGAR as a combined filing with a
Schedule TO, however, the combined
filing would not be required or allowed
to be filed using structured, machinereadable language. EDGAR will be
modified accordingly.
In addition, EDGAR will be modified
such that when the amendments
become effective on February 5, 2024, a
Schedule 13D, Schedule 13D/A,
Schedule 13G, and Schedule 13G/A
filed before 10 p.m. eastern time on a
day that EDGAR is operating will
receive a filing date identical to the
EDGAR received date and will be
disseminated until 10 p.m. eastern time.
Investment Company Name
Clarification
On September 20, 2023, the
Commission amended rules under the
Investment Company Act of 1940 to
clarify certain broad categories of
investment company names that are
likely to mislead investors about an
investment company’s investments and
risks.5 To implement this rulemaking,
EDGAR will be updated to support a
new taxonomy—FND—with 2023 and
2022 versions. EDGAR will also be
updated to accept Inline XBRL
submissions on Forms N–8B–2 and
S–6.
Removal of Certain Defunct and
Discontinued Forms
EDGAR will be updated to remove the
following obsolete forms from the
1 See
2 EDGAR
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4 Modernization of Beneficial Ownership
Reporting, Release No. 33–11253 (Oct. 10, 2023) [88
FR 76986 (Nov. 7, 2023)].
5 Investment Company Names, Release No. 33–
11238A (Sep. 20, 2023) [88 FR 70436 (Oct. 11,
2023)].
E:\FR\FM\24JAR1.SGM
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]]>Agencies
[Federal Register Volume 89, Number 16 (Wednesday, January 24, 2024)]
[Rules and Regulations]
[Pages 4542-4545]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-01341]
=======================================================================
-----------------------------------------------------------------------
COMMODITY FUTURES TRADING COMMISSION
17 CFR Part 143
RIN 3038-AF32
Annual Adjustment of Civil Monetary Penalties To Reflect
Inflation--2024
AGENCY: Commodity Futures Trading Commission.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Commodity Futures Trading Commission (Commission) is
amending its rule that governs the maximum amount of civil monetary
penalties imposed under the Commodity Exchange Act (CEA), to adjust for
inflation. This rule sets forth the maximum, inflation-adjusted dollar
amount for civil monetary penalties (CMPs) assessable for violations of
the CEA and Commission rules, regulations and orders thereunder. The
rule, as amended, implements the Federal Civil Penalties Inflation
Adjustment Act of 1990, as amended.
DATES: This rule is effective on January 24, 2024 and is applicable to
penalties assessed after January 15, 2024.
FOR FURTHER INFORMATION CONTACT: Edward J. Riccobene, Associate Chief
Counsel, Division of Enforcement, at (202) 418-5327 or
[email protected], Commodity Futures Trading Commission, 1155 21st
Street NW, Washington, DC 20581.
SUPPLEMENTARY INFORMATION:
I. Background
The Federal Civil Penalties Inflation Adjustment Act of 1990
(FCPIAA) \1\ requires the head of each Federal agency to periodically
adjust for inflation the minimum and maximum amount of CMPs provided by
law within the jurisdiction of that agency.\2\ A 2015 amendment to the
FCPIAA \3\ required agencies to make an initial ``catch-up'' adjustment
to its civil monetary penalties effective no later than August 1,
2016.\4\ For every year thereafter effective not later than January
15th, the FCPIAA, as amended, requires agencies to make annual
adjustments for inflation, with guidance from the Director of the
Office of Management and Budget.\5\
---------------------------------------------------------------------------
\1\ The FCPIAA, Public Law 101-410 (1990), as amended, is
codified at 28 U.S.C. 2461 note. The FCPIAA states that the purpose
of the FCPIAA is to establish a mechanism that shall (1) allow for
regular adjustment for inflation of civil monetary penalties; (2)
maintain the deterrent effect of civil monetary penalties and
promote compliance with the law; and (3) improve the collection by
the Federal Government of civil monetary penalties.
\2\ For the relevant CMPs within the Commission's jurisdiction,
the Act provides only for maximum amounts that can be assessed for
each violation of the Act or the rules, regulations and orders
promulgated thereunder; the Act does not set forth any minimum
penalties. Therefore, the remainder of this release will refer only
to CMP maximums.
\3\ Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015, Public Law 114-74, 129 Stat. 584 (2015)
(2015 Act), title VII, Section 701.
\4\ FCPIAA Sections 4 and 5. See also, Adjustment of Civil
Monetary Penalties for Inflation, 81 FR 41435 (June 27, 2016).
\5\ FCPIAA Sections 4 and 5. See also, Executive Office of the
President, Office of Management and Budget Memorandum, M-24-07,
Implementation of Penalty Inflation Adjustments for 2024 (Dec. 19,
2023) (2023 OMB Guidance) (https://www.whitehouse.gov/wp-content/uploads/2023/12/M-24-07-Implementation-of-Penalty-Inflation-Adjustments-for-2024.pdf).
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II. Commodity Exchange Act Civil Monetary Penalties
The following sections of the CEA provide for CMPs that meet the
FCPIAA
[[Page 4543]]
definition \6\ and these CMPs are, therefore, subject to the inflation
adjustment: Sections 6(c), 6b, and 6c of the CEA.\7\
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\6\ FCPIAA Section 3(2).
\7\ 7 U.S.C. 9, 13a-1, 13b. Criminal authorities may also seek
fines for criminal violations of the CEA (see 7 U.S.C. 13, 13(c),
13(d), 13(e), and 13b). The FCPIA does not affect the amounts of
these criminal penalties.
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III. Annual Inflation Adjustment for Commodity Exchange Act Civil
Monetary Penalties
A. Methodology
The FCPIAA annual inflation adjustment, in the context of the
CFTC's CMPs, is determined by increasing the maximum penalty by a
``cost-of-living adjustment'', rounded to the nearest multiple of one
dollar.\8\ Annual inflation adjustments are based on the percent change
between the October Consumer Price Index for all Urban Consumers (CPI-
U) preceding the date of the adjustment, and the prior year's October
CPI-U.\9\ In this case, the October 2023 CPI-U (307.671)/October 2022
CPI-U (298.012) = 1.03241.\10\ In order to complete the 2024 annual
adjustment, the CFTC must multiply each of its most recent CMP amounts
by the multiplier, 1.03241, and round to the nearest dollar.\11\
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\8\ FCPIAA Sections 4 and 5.
\9\ FCPIAA Section 5(b)(1).
\10\ The CPI-U is published by the Department of Labor.
Interested parties may find the relevant Consumer Price Index on the
internet. To access this information, go to the Consumer Price Index
Home Page at: https://www.bls.gov/cpi/. Click the ``CPI Data/
Databases'' heading, and select ``All Urban Consumers (Current
Series)'', ``Top Picks.'' Then check the box for ``U.S. city
average, All items--CUUR0000SA0'', and click the ``Retrieve data''
button.
\11\ FCPIAA Section 5(a). See also, 2023 OMB Guidance at 1.
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B. Civil Monetary Penalty Adjustments
Applying the FCPIAA annual inflation adjustment methodology results
in the following amended CMPs:
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Violations occurring on or after 11/02/2015
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U.S. Code citation Civil monetary penalty Penalty amount CPI-U New adjusted
description in 2023 multiplier penalty amount
final rule \12\
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Civil Monetary Penalty Imposed by the Commission in an Administrative Action
----------------------------------------------------------------------------------------------------------------
7 U.S.C. 9 (Section 6(c) of For any person Other Than $194,710 1.03241 $201,021
the Commodity Exchange Act). other than a Manipulation
registered or Attempted
entity\1\. Manipulation.
For any person Manipulation or 1,404,520 1.03241 1,450,040
other than a Attempted
registered Manipulation.
entity \1\.
7 U.S.C. 13a (Section 6b of For a registered Other Than 1,072,570 1.03241 1,107,332
the Commodity Exchange Act). entity \1\ or Manipulation
any of its or Attempted
directors, Manipulation.
officers or
employees.
For a registered Manipulation or 1,404,520 1.03241 1,450,040
entity \1\ or Attempted
any of its Manipulation.
directors,
officers or
employees.
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Civil Monetary Penalty Imposed by a Federal District Court in a Civil Injunctive Action
----------------------------------------------------------------------------------------------------------------
7 U.S.C. 13a-1 (Section 6c of Any Person...... Other Than 214,514 1.03241 221,466
the Commodity Exchange Act). Manipulation
or Attempted
Manipulation.
Any Person...... Manipulation or 1,404,520 1.03241 1,450,040
Attempted
Manipulation.
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\1\ The term ``Registered Entity'' is defined in 7 U.S.C. 1a (Section 1a of the Commodity Exchange Act).
The FCPIAA provides that any increase under the FCPIAA in a civil
monetary penalty shall apply only to civil monetary penalties,
including those whose associated violation predated such increase,
which are assessed after the date the increase takes effect.\13\ Thus,
the new CMP amounts established by this rulemaking shall apply to
penalties assessed after January 15, 2024, for violations that occurred
on or after November 2, 2015, the effective date of the FCPIAA
amendment requiring annual adjustments, the 2015 Act.
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\12\ Annual Adjustment of Civil Monetary Penalties to Reflect
Inflation--2023, 88 FR 1501 (Jan. 11, 2023); https://www.cftc.gov/sites/default/files/2023/01/2023-00396a.pdf.
\13\ FCPIAA Section 6.
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IV. Administrative Compliance
A. Notice Requirement
The FCPIAA specifically exempted from the Administrative Procedure
Act (APA) the rulemakings required to implement annual inflation
adjustments.\14\ This means that the public procedure the APA generally
requires--notice, an opportunity for comment, and a delay in effective
date--is not required for agencies to issue regulations implementing
the annual adjustment.\15\ The Commission further notes that the notice
and comment procedures of the APA do not apply to this rulemaking
because the Commission is acting herein pursuant to statutory language
that mandates that the Commission act in a nondiscretionary matter.\16\
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\14\ FCPIAA Section 4(b)(2).
\15\ 2023 OMB Guidance at 3-4.
\16\ Lake Carriers' Ass'n v. E.P.A., 652 F.3d 1, 10 (D.C. Cir.
2011).
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B. Regulatory Flexibility Act
The Regulatory Flexibility Act \17\ requires agencies with
rulemaking authority to consider the impact of certain of their rules
on small businesses. A regulatory flexibility analysis is only required
for rules for which the agency publishes a general notice of proposed
rulemaking pursuant to section 553(b) or any other law.\18\ Because, as
discussed above, the Commission is not obligated by section 553(b) or
any other law to publish a general notice of proposed rulemaking with
respect to the revisions being made to Rule 143.8, the Commission
additionally is not obligated to conduct a regulatory flexibility
analysis.
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\17\ 5 U.S.C. 601-612.
\18\ 5 U.S.C. 603(a).
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C. Paperwork Reduction Act
The Paperwork Reduction Act of 1995 (PRA),\19\ which imposes
certain requirements on Federal agencies, including the Commission, in
connection with their conducting or sponsoring any collection of
information as defined by the PRA, does not apply to this rule. This
rule amendment does not contain information collection requirements
that
[[Page 4544]]
require the approval of the Office of Management and Budget.
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\19\ 44 U.S.C. 3507(d).
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D. Consideration of Costs and Benefits
Section 15(a) of the CEA \20\ requires the Commission to consider
the costs and benefits of its action before issuing a new regulation.
Section 15(a) of the CEA further specifies that costs and benefits
shall be evaluated in light of five broad areas of market and public
concern: (1) protection of market participants and the public; (2)
efficiency, competitiveness, and financial integrity of futures
markets; (3) price discovery; (4) sound risk management practices; and
(5) other public interest considerations.
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\20\ 7 U.S.C. 19(a).
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The Commission believes that benefits of this rulemaking greatly
outweigh the costs, if any. As the Commission understands, the
statutory provisions by which it is making cost-of-living adjustments
to the CMPs in Rule 143.8 were enacted to ensure that CMPs do not lose
their deterrence value because of inflation. An analysis of the costs
and benefits of these adjustments were made before enactment of the
statutory provisions under which the Commission is operating, and limit
the discretion of the Commission to the extent that there are no
regulatory choices the Commission could make that would supersede the
pre-enactment analysis with respect to the five factors enumerated in
Section 15(a) of the CEA, or any other factors.
List of Subjects in 17 CFR Part 143
Claims, Penalties.
For the reasons set forth in the preamble, the Commodity Futures
Trading Commission amends part 143 of chapter I of title 17 of the Code
of Federal Regulations as follows:
PART 143--COLLECTION OF CLAIMS OWED THE UNITED STATES ARISING FROM
ACTIVITIES UNDER THE COMMISSION'S JURISDICTION
0
1. The authority citation for part 143 continues to read as follows:
Authority: 7 U.S.C. 9, 9a, 12a(5), 13a, 13a-1(d), 13(a), 13b;
31 U.S.C. 3701-3720E; 28 U.S.C. 2461 note.
0
2. Amend Sec. 143.8 by revising paragraph (b) to read as follows:
Sec. 143.8 Inflation-adjusted civil monetary penalties.
* * * * *
(b) 2024 Inflation adjustment. The maximum amount of each civil
monetary penalty in the following charts applies to penalties assessed
after January 15, 2024:
(1) For violations, other manipulation, or attempted manipulation:
Table 1 to Paragraph (b)(1)
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Date of violation and corresponding penalty
-------------------------------------------------------
U.S. Code citation Civil monetary 10/23/2004 10/23/2008 10/23/2012
penalty description through 10/ through 10/ through 11/ 11/02/2015
22/2008 22/2012 01/2015 to present
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Civil Monetary Penalty Imposed by the Commission in an Administrative Action
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7 U.S.C. 9 (Section 6(c) of the For any person other $130,000 $140,000 $140,000 $201,021
Commodity Exchange Act). than a registered
entity \1\.
7 U.S.C. 13a (Section 6b of the For a registered 625,000 675,000 700,000 1,107,332
Commodity Exchange Act). entity \1\ or any
of its directors,
officers or
employees.
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Civil Monetary Penalty Imposed by a Federal District Court in a Civil Injunctive Action
----------------------------------------------------------------------------------------------------------------
7 U.S.C. 13a-1 (Section 6c of the Any Person.......... 130,000 140,000 140,000 221,466
Commodity Exchange Act).
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\1\ The term ``Registered Entity'' is defined in 7 U.S.C. 1a (Section 1a of the Commodity Exchange Act).
(2) For manipulation or attempted manipulation violations:
Table 2 to Paragraph (b)(2)
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Date of violation and corresponding penalty
-------------------------------------------------------
U.S. Code citation Civil monetary 10/23/2004 05/22/2008 08/15/2011
penalty description through 05/ through 08/ through 11/ 11/02/2015
21/2008 14/2011 01/2015 to present
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Civil Monetary Penalty Imposed by the Commission in an Administrative Action
----------------------------------------------------------------------------------------------------------------
7 U.S.C. 9 (Section 6(c) of the For any person other $130,000 $1,000,000 $1,025,000 $1,450,040
Commodity Exchange Act). than a registered
entity \1\.
7 U.S.C. 13a (Section 6b of the For a registered 625,000 1,000,000 1,025,000 1,450,040
Commodity Exchange Act). entity \1\ or any
of its directors,
officers or
employees.
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Civil Monetary Penalty Imposed by a Federal District Court in a Civil Injunctive Action
----------------------------------------------------------------------------------------------------------------
7 U.S.C. 13a-1 (Section 6c of the Any Person.......... 130,000 1,000,000 1,025,000 1,450,040
Commodity Exchange Act).
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\1\ The term ``Registered Entity'' is defined in 7 U.S.C. 1a (Section 1a of the Commodity Exchange Act).
[[Page 4545]]
Issued in Washington, DC, on January 19, 2024, by the
Commission.
Robert Sidman,
Deputy Secretary of the Commission.
Note: The following appendix will not appear in the Code of
Federal Regulations.
Appendix to Annual Adjustment of Civil Monetary Penalties To Reflect
Inflation--2024--Commission Voting Summary
On this matter, Chairman Behnam and Commissioners Johnson,
Goldsmith Romero, Mersinger, and Pham voted in the affirmative. No
Commissioner voted in the negative.
[FR Doc. 2024-01341 Filed 1-23-24; 8:45 am]
BILLING CODE 6351-01-P
