Rules of Practice for Hearings

1Public Law 114–74, 129 Stat. 599 (2015)
(codified at 28 U.S.C. 2461 note).
2 28 U.S.C. 2461 note, 4(b)(1).
3 77 FR 68,680 (Nov. 16, 2012).
4OMB Memorandum M–24–07, Implementation of Penalty Inflation Adjustments for 2024, Pursuant to the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (Dec. 19, 2023). 5Under the 2015 Act and implementing OMB guidance, agencies are not required to make an adjustment to a CMP if, during the 12 months preceding the required adjustment, such penalty increased due to a law other than the 2015 Act by an amount greater than the amount of the required adjustment. No other laws have adjusted the CMPs within the Board’s jurisdiction during the preceding 12 months. FEDERAL RESERVE SYSTEM 12 CFR Part 263 [Docket No. R–1827] RIN 7100–AG74 Rules of Practice for Hearings AGENCY: Board of Governors of the Federal Reserve System. ACTION: Final rule. SUMMARY: The Board of Governors of the Federal Reserve System (the ‘‘Board’’) is issuing a final rule amending its rules of practice and procedure to adjust the amount of each civil money penalty (‘‘CMP’’) provided by law within its jurisdiction to account for inflation as required by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. DATES: This final rule is effective on January 12, 2024. FOR FURTHER INFORMATION CONTACT:
Thomas O. Kelly, Senior Counsel (202–
974–7059), Legal Division, Board of
Governors of the Federal Reserve
System, 20th Street and Constitution
Ave. NW, Washington, DC 20551. For users of TTY–TRS, please call 711 from any telephone, anywhere in the United States.
SUPPLEMENTARY INFORMATION:
Federal Civil Penalties Inflation
Adjustment Act
The Federal Civil Penalties Inflation
Adjustment Act of 1990, 28 U.S.C. 2461 note (‘‘FCPIA Act’’), requires federal agencies to adjust, by regulation, the CMPs within their jurisdiction to account for inflation. The Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (the ‘‘2015 Act’’) 1 amended the FCPIA Act to require federal agencies to make annual adjustments not later than January 15 of every year.2 The Board is now issuing a new final rule to set the CMP levels pursuant to the required annual adjustment for 2024. The Board will apply these adjusted maximum penalty levels to any penalties assessed on or after [publication date], whose associated violations occurred on or after November 2, 2015. Penalties assessed for violations occurring prior to November 2, 2015, will be subject to the amounts set in the Board’s 2012 adjustment pursuant to the FCPIA Act.3 Under the 2015 Act, the annual adjustment to be made for 2024 is the percentage by which the Consumer Price Index for the month of October 2023 exceeds the Consumer Price Index for the month of October 2022. On December 19, 2023, as directed by the 2015 Act, the Office of Management and Budget (OMB) issued guidance to affected agencies on implementing the required annual adjustment which included the relevant inflation multiplier.4 Using OMB’s multiplier, the Board calculated the adjusted penalties for its CMPs, rounding the penalties to the nearest dollar.5 Administrative Procedure Act The 2015 Act states that agencies shall make the annual adjustment ‘‘notwithstanding section 553 of title 5, United States Code.’’ Therefore, this rule is not subject to the provisions of the Administrative Procedure Act (the ‘‘APA’’), 5 U.S.C. 553, requiring notice, public participation, and deferred effective date. Regulatory Flexibility Act The Regulatory Flexibility Act, 5 U.S.C. 601 et seq., requires a regulatory flexibility analysis only for rules for which an agency is required to publish a general notice of proposed rulemaking. Because the 2015 Act states that agencies’ annual adjustments are to

be made notwithstanding section 553 of title 5 of United States Code—the APA
section requiring notice of proposed
rulemaking—the Board is not publishing a notice of proposed rulemaking. Therefore, the Regulatory Flexibility Act does not apply.
Paperwork Reduction Act
There is no collection of information required by this final rule that would be subject to the Paperwork Reduction Act of 1995, 44 U.S.C. 3501 et seq. List of Subjects in 12 CFR Part 263 Administrative practice and procedure, Claims, Crime, Equal access to justice, Lawyers, Penalties. Authority and Issuance For the reasons set forth in the preamble, the Board amends 12 CFR
part 263 to read as follows:
PART 263—RULES OF PRACTICE FOR
HEARINGS

• 1. The authority citation for part 263
     continues to read as follows:
     Authority: 5 U.S.C. 504, 554–557; 12
     U.S.C. 248, 324, 334, 347a, 504, 505, 1464,
     1467, 1467a, 1817(j), 1818, 1820(k), 1829,
     1831o, 1831p–1, 1832(c), 1847(b), 1847(d),
     1884, 1972(2)(F), 3105, 3108, 3110, 3349,
     3907, 3909(d), 4717; 15 U.S.C. 21, 78l(i),
     78o–4, 78o–5, 78u–2; 1639e(k); 28 U.S.C.
     2461 note; 31 U.S.C. 5321; and 42 U.S.C.
     4012a.
• 2. Section 263.65 is revised to read as
     follows:
     § 263.65 Civil money penalty inflation adjustments.
     (a) Inflation adjustments. In accordance with the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015, which further amended the Federal Civil Penalties Inflation Adjustment Act of 1990, the Board has set forth in paragraph (b) of this section the adjusted maximum amounts for each civil money penalty provided by law within the Board’s jurisdiction. The authorizing statutes contain the complete provisions under which the Board may seek a civil money penalty. The adjusted civil money penalties apply only to penalties assessed on or after January 12, 2024, whose associated violations occurred on or after November 2, 2015. (b) Maximum civil money penalties. The maximum (or, in the cases of 12 U.S.C. 334 and 1832(c), fixed) civil money penalties as set forth in the referenced statutory sections are set forth in the table in this paragraph (b).
     TABLE 1 TO PARAGRAPH (b)
     Statute Adjusted civil money penalty
     12 U.S.C. 324:
     Inadvertently late or misleading reports, inter alia ............................................................................................................... $4,899 Other late or misleading reports, inter alia ........................................................................................................................... 48,992 Knowingly or reckless false or misleading reports, inter alia ............................................................................................... 2,449,575
     12 U.S.C. 334 .............................................................................................................................................................................. 356
     12 U.S.C. 374a ............................................................................................................................................................................ 356
     12 U.S.C. 504:
     First Tier ............................................................................................................................................................................... 12,249 Second Tier .......................................................................................................................................................................... 61,238 Third Tier .............................................................................................................................................................................. 2,449,575 12 U.S.C. 505:
     First Tier ............................................................................................................................................................................... 12,249 Second Tier .......................................................................................................................................................................... 61,238 Third Tier .............................................................................................................................................................................. 2,449,575 12 U.S.C. 1464(v)(4) ................................................................................................................................................................... 4,899 12 U.S.C. 1464(v)(5) ................................................................................................................................................................... 48,992 12 U.S.C. 1464(v)(6) ................................................................................................................................................................... 2,449,575 12 U.S.C. 1467a(i)(2) .................................................................................................................................................................. 61,238 12 U.S.C. 1467a(i)(3) .................................................................................................................................................................. 61,238 12 U.S.C. 1467a(r):
     First Tier ............................................................................................................................................................................... 4,899 Second Tier .......................................................................................................................................................................... 48,992 Third Tier .............................................................................................................................................................................. 2,449,575 12 U.S.C. 1817(j)(16):
     First Tier ............................................................................................................................................................................... 12,249 Second Tier .......................................................................................................................................................................... 61,238 Third Tier .............................................................................................................................................................................. 2,449,575 12 U.S.C. 1818(i)(2):
     First Tier ............................................................................................................................................................................... 12,249 Second Tier .......................................................................................................................................................................... 61,238 Third Tier .............................................................................................................................................................................. 2,449,575 12 U.S.C. 1820(k)(6)(A)(ii) ........................................................................................................................................................... 402,920 12 U.S.C. 1832(c) ........................................................................................................................................................................ 3,558 12 U.S.C. 1847(b) ........................................................................................................................................................................ 61,238 12 U.S.C. 1847(d):
     First Tier ............................................................................................................................................................................... 4,899 Second Tier .......................................................................................................................................................................... 48,992 Third Tier .............................................................................................................................................................................. 2,449,575
     12 U.S.C. 1884 ............................................................................................................................................................................ 356
     12 U.S.C. 1972(2)(F):
     First Tier ............................................................................................................................................................................... 12,249 Second Tier .......................................................................................................................................................................... 61,238 Third Tier .............................................................................................................................................................................. 2,449,575 12 U.S.C. 3110(a) ........................................................................................................................................................................ 55,981 12 U.S.C. 3110(c):

1While the 1990 Act, as amended by the 1996 and 2015 Acts, uses the term ‘‘civil monetary penalties’’ for these penalties or other sanctions, the Farm Credit Act and FCA regulations use the term ‘‘civil money penalties.’’ Both terms have the same meaning. Accordingly, this rule uses the term civil money penalty, and both terms may be used interchangeably. 2See 28 U.S.C. 2461 note. 3Public Law 92–181, as amended. 4 42 U.S.C. 4012a and Public Law 103–325, title V, 108 Stat. 2160, 2255–87 (September 23, 1994). 5The inflation-adjusted CMP in effect on January 15, 2023, for a violation of a final order is $2,741 per day, as set forth in § 622.61(a)(1) of FCA regulations.
TABLE 1 TO PARAGRAPH (b)—Continued
Statute Adjusted civil money penalty
First Tier ............................................................................................................................................................................... 4,480 Second Tier .......................................................................................................................................................................... 44,783 Third Tier .............................................................................................................................................................................. 2,239,210 12 U.S.C. 3909(d) ........................................................................................................................................................................ 3,047 15 U.S.C. 78u–2(b)(1):
For a natural person ............................................................................................................................................................. 11,524 For any other person ............................................................................................................................................................ 115,231 15 U.S.C. 78u–2(b)(2) For a natural person ............................................................................................................................................................. 115,231 For any other person ............................................................................................................................................................ 576,158 15 U.S.C. 78u–2(b)(3) For a natural person ............................................................................................................................................................. 230,464 For any other person ............................................................................................................................................................ 1,152,314 15 U.S.C. 1639e(k)(1) ................................................................................................................................................................. 14,069 15 U.S.C. 1639e(k)(2) ................................................................................................................................................................. 28,135 42 U.S.C. 4012a(f)(5) .................................................................................................................................................................. 2,661 By order of the Board of Governors of the Federal Reserve System, acting through the Secretary of the Board under delegated authority. Ann E. Misback, Secretary of the Board. [FR Doc. 2024–00650 Filed 1–11–24; 8:45 am] BILLING CODE 6210–01–P