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Financial Crimes Enforcement Network (“FinCEN”), Treasury.
Final rule.
FinCEN publishes this final rule to reflect inflation adjustments to its civil monetary penalties (“CMPs”) as mandated by the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (collectively referred to herein as the “2015 Act”). This rule adjusts certain CMPs within the jurisdiction of FinCEN to the maximum amount required by the 2015 Act.
Effective February 19, 2020.
The FinCEN Resource Center at (800) 767-2825 or email frc@fincen.gov.
In order to improve the effectiveness of CMPs and to maintain their deterrent effect, the Federal Civil Penalties Inflation Adjustment Act of 1990, 28 U.S.C. 2461 note (“Inflation Adjustment Act”), as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (Pub. L. 114-74) (“2015 Act”), requires Federal agencies to adjust each CMP provided by law within the jurisdiction of the agency. The 2015 Act requires agencies to adjust the level of CMPs with an initial “catch-up” adjustment through an interim final rulemaking and to make subsequent annual adjustments for inflation, without needing to provide notice and the opportunity for public comment otherwise required by 5 U.S.C. 553. The 2015 Act provides that any increase in a CMP shall apply to CMPs that are assessed after the date the increase takes effect, regardless of whether the underlying violation predated such increase.[1]
The method of calculating CMP adjustments applied in this final rule is required by the 2015 Act. Under the 2015 Act and the Office of Management and Budget (“OMB”) guidance required by the 2015 Act, annual inflation adjustments subsequent to the initial catch-up adjustment are to be based on the percent change between the Consumer Price Index for all Urban Consumers (“CPI-U”) for the October preceding the date of the adjustment and the prior year's October CPI-U. As set forth in OMB Memorandum M-20-05 of December 16, 2019, the adjustment multiplier for 2020 is 1.01764. In order to complete the 2020 annual adjustment, each current CMP is ( printed page 9371) multiplied by the 2020 adjustment multiplier. Under the 2015 Act, any increase in CMP must be rounded to the nearest multiple of $1.
Section 701(b) of the 2015 Act requires agencies, beginning in 2017, to make annual adjustments for inflation to CMPs without needing to provide notice and the opportunity for public comment required by 5 U.S.C. 553. Additionally, the methodology used for adjusting CMPs for inflation, effective 2017, is provided by statute, with no discretion provided to agencies regarding the substance of the adjustments for inflation to CMPs. FinCEN is charged only with performing ministerial computations to determine the dollar amount of adjustments for inflation to CMPs. Accordingly, prior public notice and an opportunity for public comment and a delayed effective date are not required for this rule.
Because no notice of proposed rulemaking is required, the provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) do not apply.
This rule is not a significant regulatory action as defined in section 3.f of Executive Order 12866.
The provisions of the Paperwork Reduction Act of 1995, Public Law 104-13, 44 U.S.C. Chapter 35, and its implementing regulations, 5 CFR part 1320, do not apply to this rule because there are no new or revised recordkeeping or reporting requirements.
For the reasons set forth in the preamble, Part 1010 of Chapter X of title 31 of the Code of Federal Regulations is amended as follows:
1. The authority citation for part 1010 continues to read as follows:
2. Amend § 1010.821 by revising Table 1 to read as follows:
(b) * * *
| U.S. Code citation | Civil monetary penalty description | Penalties as last amended by statute | Maximum penalty amounts or range of minimum and maximum penalty amounts for penalties assessed on or after February 19, 2020 |
|---|---|---|---|
| 12 U.S.C. 1829b(j) | Relating to Recordkeeping Violations For Funds Transfers | $10,000 | $21,410 |
| 12 U.S.C. 1955 | Willful or Grossly Negligent Recordkeeping Violations | 10,000 | 21,410 |
| 31 U.S.C. 5318(k)(3)(C) | Failure to Terminate Correspondent Relationship with Foreign Bank | 10,000 | 14,482 |
| 31 U.S.C. 5321(a)(1) | General Civil Penalty Provision for Willful Violations of Bank Secrecy Act Requirements | 25,000 −100,000 | 58,328 −233,313 |
| 31 U.S.C. 5321(a)(5)(B)(i) | Foreign Financial Agency Transaction—Non-Willful Violation of Transaction | 10,000 | 13,481 |
| 31 U.S.C. 5321(a)(5)(C)(i)(I) | Foreign Financial Agency Transaction—Willful Violation of Transaction | 100,000 | 134,806 |
| 31 U.S.C. 5321(a)(6)(A) | Negligent Violation by Financial Institution or Non-Financial Trade or Business | 500 | 1,166 |
| 31 U.S.C. 5321(a)(6)(B) | Pattern of Negligent Activity by Financial Institution or Non-Financial Trade or Business | 50,000 | 90,743 |
| 31 U.S.C. 5321(a)(7) | Violation of Certain Due Diligence Requirements, Prohibition on Correspondent Accounts for Shell Banks, and Special Measures | 1,000,000 | 1,448,191 |
| 31 U.S.C. 5330(e) | Civil Penalty for Failure to Register as Money Transmitting Business | 5,000 | 8,606 |
Jamal El-Hindi
Deputy Director, Financial Crimes Enforcement Network.
1. The increased CMPs, however, apply only with respect to underlying violations occurring after the date of enactment of the 2015 Act, i.e., after November 2, 2015.
Back to Citation[FR Doc. 2020-02526 Filed 2-18-20; 8:45 am]
BILLING CODE 4810-02-P