[Federal Register Volume 61, Number 205 (Tuesday, October 22, 1996)]
[Rules and Regulations]
[Pages 54728-54729]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-27057]
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FARM CREDIT ADMINISTRATION
12 CFR Part 622
RIN 3052-AB74
Rules of Practice and Procedure; Adjusting Civil Money Penalties
for Inflation
AGENCY: Farm Credit Administration.
ACTION: Final rule.
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SUMMARY: As required by the Debt Collection Improvement Act of 1996
(DCIA), the Farm Credit Administration (FCA) through the FCA Board
(Board) adopts a final regulation that adjusts each civil money penalty
(CMP) under its jurisdiction by the rate of inflation using the formula
prescribed by DCIA. This statute requires all Federal agencies to
adjust each CMP by the rate of inflation and promulgate implementing
regulations within 180 days after enactment of DCIA and at least once
every 4 years thereafter. Any increase in a CMP shall apply only to
violations that occur after the effective date of this regulation.
EFFECTIVE DATE: October 23, 1996.
[[Page 54729]]
FOR FURTHER INFORMATION CONTACT:
Robert Child, Policy Analyst, Office of Policy Development and Risk
Control, Farm Credit Administration, McLean, VA 22102-5090, (703) 883-
4498, TDD (703) 883-4444; or
Richard Katz, Senior Attorney, Office of General Counsel, Farm Credit
Administration, McLean, VA 22102-5090, (703) 883-4020, TDD (703) 883-
4444.
SUPPLEMENTARY INFORMATION: DCIA 1 amended the Federal Civil
Monetary Penalties Inflation Adjustment Act of 1990 2 (FCMPIA Act)
to require every Federal agency to enact regulations that adjust each
CMP 3 provided by law under its jurisdiction by the rate of
inflation pursuant to the inflation adjustment formula in section 5(b)
of the FCMPIA Act. Each Federal agency is required to issue these
implementing regulations by October 23, 1996, which is 180 days after
the date that DCIA was enacted, and at least once every 4 years
thereafter. Section 7 of the amended FCMPIA Act specifies that only
CMPs for violations that occur after October 23, 1996, will be adjusted
for inflation.
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\1\ Pub. L. 104-134, section 31001(s), 110 Stat. 1321-358,
(Apr. 26, 1996). This provision is codified at 28 U.S.C. 2461 note.
\2\ Pub. L. 101-410, 104 Stat. 890, (Oct. 5, 1990).
\3\ Section 3(2) of the amended FCMPIA Act defines a CMP as any
penalty, fine, or other sanction that: (1) Either is for a specific
monetary amount as provided by Federal law or has a maximum amount
provided for by Federal law; (2) is assessed or enforced by an
agency pursuant to Federal law; and (3) is assessed or enforced
pursuant to an administrative proceeding or a civil action in the
Federal courts.
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The inflation adjustment is based on the percentage increase in the
Consumer Price Index (CPI) 4 for the period from June of the
calendar year when the CMP was last set until June of the calendar year
preceding the adjustment.
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\4\ The CPI is published by the Department of Labor, Bureau of
Statistics.
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Furthermore, each CMP that has been adjusted for inflation must be
rounded to a number prescribed by section 5(a) of the FCMPIA Act.5
Another provision of the DCIA limits the first adjustment of a CMP to
an amount not in excess of 10 percent of the original penalty. The
amount of increase in the final regulation would have been more if this
limit did not exist.
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\5\ For example, an increase that is less than a hundred
dollars would be rounded to the nearest multiple of $10, and an
increase over $100 but less than $1,000 would be rounded to the
nearest multiple of $100.
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Two provisions of section 5.32(a) of the Farm Credit Act of 1971,
as amended (Act) authorize the FCA to impose CMPs on Farm Credit System
(FCS) institutions and their related parties. First, section 5.32(a)
specifies that any FCS institution or any officer, director, employee,
agent, or other person participating in the conduct of the affairs of
an institution who violates the terms of a temporary or permanent cease
and desist order that has become final shall forfeit not more than
$1,000 per day for each day during which such violation continues. This
same statutory provision also states that ``[a]ny such institution or
person who violates any provision of this Act or any regulation issued
under this Act shall forfeit and pay a civil penalty of not more than
$500 per day for each day during which such violation continues.''
After the adjustment for inflation, the maximum penalty that the
FCA can impose under section 5.32(a) of the Act for the violation of a
cease and desist order is $1,100 per day. When the same inflation
adjustment formula is applied to the CMP that section 5.32(a) imposes
on FCS institutions and their affiliated parties for violations of the
Act or regulation, the new maximum penalty amount is $550 per day. The
FCA now adopts final Sec. 622.61 which adjusts these two CMPs to the
rate of inflation, as required by the DCIA.
DCIA provides Federal agencies with no discretion in the adjustment
of CMPs to the rate of inflation, and it also requires the new
regulation to take effect on October 23, 1996. Moreover, the regulation
that the FCA adopts today to implement DCIA is ministerial, minor,
technical, and noncontroversial. For these reasons, the FCA finds good
cause to determine that public notice and comment for this new
regulation is unnecessary, impractical, and contrary to the public
interest, pursuant to the Administrative Procedure Act (APA), 5 U.S.C.
553(a)(3)(B). These same reasons also provide the FCA with good cause
to adopt an effective date for this regulation that is less than 30
days after the date of publication in the Federal Register.
Furthermore, the FCA determines that pursuant to the requirements of
section 5.17(c)(2) of the Act this regulation shall take effect prior
to the expiration of the 30-day Congressional waiting period for final
FCA regulatory action due to the Congressionally mandated effective
date of October 23, 1996.
List of Subjects in 12 CFR Part 622
Administrative practice and procedure, Crime, Investigations,
Penalties.
For the reasons stated in the preamble, part 622 of chapter VI,
title 12 of the Code of Federal Regulations are amended to read as
follows:
PART 622--RULES OF PRACTICE AND PROCEDURE
1. The authority citation for part 622 is revised to read as
follows:
Authority: Secs. 5.9, 5.10, 5.17, 5.25-5.37 of the Farm Credit
Act (12 U.S.C. 2243, 2244, 2252, 2261-2273); Pub. L. 104-134, sec.
31001(s), 110 Stat. 1321-358.
Subpart B--Rules and Procedures for Assessment and Collection of
Civil Money Penalties
2. Subpart B is amended by adding a new Sec. 622.61 to read as
follows:
Sec. 622.61 Adjustment of civil money penalties by the rate of
inflation pursuant to section 31001(s) of the Debt Collection
Improvement Act of 1996.
(a) A civil money penalty imposed pursuant to section 5.32 of the
Act for a violation occurring after October 23, 1996 of a final cease
and desist order issued under section 5.25 or 5.26 of the Act shall not
exceed $1,100 per day for each day the violation continues.
(b) A civil money penalty imposed pursuant to section 5.32 of the
Act for a violation occurring after October 23, 1996 of any provision
of the Act or any regulation issued under the Act shall not exceed $550
per day for each day the violation continues.
Dated: October 17, 1996.
Floyd Fithian,
Secretary, Farm Credit Administration Board.
[FR Doc. 96-27057 Filed 10-21-96; 8:45 am]
BILLING CODE 6705-01-P
