**§1.582 Exemptions.**

\(a\) Certain systems of records maintained by the Department of
Veterans Affairs are exempted from provisions of the Privacy Act in
accordance with exemptions (j) and (k) of 5 U.S.C. 552a.

\(b\) *Exemption* of *Inspector General Systems* of *Records.* The
Department of Veterans Affairs provides limited access to Inspector
General Systems of Records as indicated.

\(1\) The following systems of records are exempted pursuant to the
provisions of 5 U.S.C. 552a(j)(2) from subsections (c)(3) and (4), (d),
(e)(1), (2) and (3), (e)(4)(G), (H) and (I), (e)(5) and (8), (f) and (g)
of 5 U.S.C. 552a; in addition, the following systems of records are
exempted pursuant to the provisions of 5 U.S.C. 552a(k)(2) from
subsections (c)(3), (d), (e)(1), (e)(4)(G), (H), and (I), and (f) of 5
U.S.C. 552a:

\(i\) Investigation Reports of Persons Allegedly Involved in
Irregularities Concerning VA and Federal Laws, Regulations, Programs,
etc.---VA (11 VA51); and

\(ii\) Inspector General Complaint Center Records---VA (66VA53).

\(2\) These exemptions apply to the extent that information in those
systems is subject to exemptions pursuant to 5 U.S.C. 552a(j)(2) and
(k)(2).

\(3\) For the reasons set forth, the systems of records listed under
paragraph (b)(1) of this section are exempted under sections 552a(j)(2)
and (k)(2) from the following provisions of 5 U.S.C. 552a:

\(i\) 5 U.S.C. 552a(c)(3) requires that upon request, an agency must
give an individual named in a record an accounting which reflects the
disclosure of the record to other persons or agencies. This accounting
must state the date, nature and purpose of each disclosure of the record
and the name and address of the recipient. The application of this
provision would alert subjects to the existence of the investigation and
identify that such persons are subject of that investigation. Since
release of such information to subjects would provide them with
significant information concerning the nature of the investigation, it
could result in the altering or destruction of derivative evidence which
is obtained from third parties, improper influencing of witnesses, and
other activities that could impede or compromise the investigation.

\(ii\) 5 U.S.C. 552a(c)(4), (d), (e)(4)(G) and (H), (f) and (g) relate
to an individual's right to be notified of the existence of records
pertaining to such individual; requirements for identifying an
individual who requests access to records; the agency procedures
relating to access to records and the amendment of information contained
in such records; and the civil remedies available to the individual in
the event of adverse determinations by an agency concerning access to or
amendment of information contained in record systems. This system is
exempt from the foregoing provisions for the following reasons: To
notify an individual at the individual's request of the existence of
records in an investigative file pertaining to such individual or to
grant access to an investigative file could interfere with investigative
and enforcement proceedings, threaten the safety of individuals who have
cooperated with authorities, constitute an unwarranted invasion of
personal privacy of others, disclose the identity of confidential
sources, reveal confidential information supplied by these sources, and
disclose investigative techniques and procedures.

\(iii\) 5 U.S.C. 552a(e)(4)(I) requires the publication of the
categories of sources of records in each system of records. The
application of this provision could disclose investigative techniques
and procedures and cause sources to refrain from giving such information
because of fear of reprisal, or fear of breach of promises of anonymity
and confidentiality. This could compromise the ability to conduct
investigations and to identify, detect and apprehend violators. Even
though the agency has claimed an exemption from this particular
requirement, it still plans to generally identify the categories of
records and the sources for these records in this system. However, for
the reasons stated in paragraph (b)(3)(ii) of this section, this
exemption is still being cited in the event an individual wants to know
a specific source of information.

\(iv\) 5 U.S.C. 552a(e)(1) requires each agency to maintain in its
records only such information about an individual that is relevant and
necessary to accomplish a purpose of the agency required by statute or
Executive order. These systems of records are exempt from the foregoing
provisions because:

\(A\) It is not possible to detect the relevance or necessity of
specific information in the early stages of a criminal or other
investigation.

\(B\) Relevance and necessity are questions of judgment and timing. What
appears relevant and necessary may ultimately be determined to be
unnecessary. It is only after the information is evaluated that the
relevance and necessity of such information can be established.

\(C\) In any investigation the Inspector General may obtain information
concerning the violations of laws other than those within the scope of
his/her jurisdiction. In the interest of effective law enforcement, the
Inspector General should retain this information as it may aid in
establishing patterns of criminal activity and provide leads for those
law enforcement agencies charged with enforcing other segments of civil
or criminal law.

\(v\) 5 U.S.C. 552a(e)(2) requires an agency to collect information to
the greatest extent practicable directly from the subject individual
when the information may result in adverse determinations about an
individual's rights, benefits, and privileges under Federal programs.
The application of this provision would impair investigations of illegal
acts, violations of the rules of conduct, merit system and any other
misconduct for the following reasons:

\(A\) In order to successfully verify a complaint, most information
about a complainant or an individual under investigation must be
obtained from third parties such as witnesses and informers. It is not
feasible to rely upon the subject of the investigation as a source for
information regarding his/her activities because of the subject's rights
against self-incrimination and because of the inherent unreliability of
the suspect's statements. Similarly, it is not always feasible to rely
upon the complainant as a source of information regarding his/her
involvement in an investigation.

\(B\) The subject of an investigation will be alerted to the existence
of an investigation if an attempt is made to obtain information from the
subject. This would afford the individual the opportunity to conceal any
criminal activities to avoid apprehension.

\(vi\) 5 U.S.C. 552a(e)(3) requires that an agency must inform the
subject of an investigation who is asked to supply information of:

\(A\) The authority under which the information is sought and whether
disclosure of the information is mandatory or voluntary;

\(B\) The purposes for which the information is intended to be used;

\(C\) The routine uses which may be made of the information; and

\(D\) The effects on the subject, if any, of not providing the requested
information. The reasons for exempting this system of records from the
foregoing provision are as follows:

(*1*) The disclosure to the subject of the purposes of the investigation
as stated in paragraph (b)(3)(vi)(B) of this paragraph would provide the
subject with substantial information relating to the nature of the
investigation and could impede or compromise the investigation.

(*2*) If the complainant or the subject were informed of the information
required by this provision, it could seriously interfere with undercover
activities requiring disclosure of the authority under which the
information is being requested. This could conceivably jeopardize
undercover agents' identities and impair their safety, as well as impair
the successful conclusion of the investigation.

(*3*) Individuals may be contacted during preliminary information
gathering in investigations before any individual is identified as the
subject of an investigation. Informing the individual of the matters
required by this provision would hinder or adversely affect any present
or subsequent investigations.

\(vii\) 5 U.S.C. 552a(e)(5) requires that records be maintained with
such accuracy, relevance, timeliness, and completeness as is reasonably
necessary to assure fairness to the individual in making any
determination about an individual. Since the law defines *maintain* to
include the collection of information, complying with this provision
would prevent the collection of any data not shown to be accurate,
relevant, timely, and complete at the moment of its collection. In
gathering information during the course of an investigation it is not
always possible to determine this prior to collection of the
information. Facts are first gathered and then placed into a logical
order which objectively proves or disproves criminal behavior on the
part of the suspect. Material which may seem unrelated, irrelevant,
incomplete, untimely, etc., may take on added meaning as an
investigation progresses. The restrictions in this provision could
interfere with the preparation of a complete investigative report.

\(viii\) 5 U.S.C. 552a(e)(8) requires an agency to make reasonable
efforts to serve notice on an individual when any record on such
individual is made available to any person under compulsory legal
process when such process becomes a matter of public record. The notice
requirement of this provision could prematurely reveal an ongoing
criminal investigation to the subject of the investigation.

\(c\) *Exemption of Loan Guaranty Service, Veterans Benefits
Administration, Systems of Records.* The Department of Veterans Affairs
provides limited access to Loan Guaranty Service, Veterans Benefits
Administration, systems of records as indicated:

\(1\) The following systems of records are exempted pursuant to the
provisions of 5 U.S.C. 552a(k)(2) from subsections (c)(3), (d), (e)(1)
and (e)(4)(G), (H) and (I) and (f):

\(i\) Loan Guaranty Fee Personnel and Program Participant Records---VA
(17VA26); and

\(ii\) Loan Guaranty Home Condominium and Mobile Home Loan Applicant
Records and Paraplegic Grant Application Records---VA (55VA26).

\(2\) These exemptions apply to the extent that information in these
systems is subject to exemption pursuant to 5 U.S.C. 552a(k)(2).

\(3\) For the reasons set forth, the systems of records listed under
paragraph (c)(1) of this section are exempted under 5 U.S.C. 552a(k)(2)
from the following provisions of 5 U.S.C. 552a:

\(i\) 5 U.S.C. 552a(c)(3) requires that an agency make accountings of
disclosures of records available to individuals named in the records at
their request. These accountings must state the date, nature and purpose
of each disclosure of the record and the name and address of the
recipient. The application of this provision would alert subjects of an
investigation to the existence of the investigation and that such
persons are subjects of that investigation. Since release of such
information to subjects of an investigation would provide the subjects
with significant information concerning the nature of the investigation,
it could result in the altering or destruction of documentary evidence,
improper influencing of witnesses and other activities that could impede
or compromise the investigation.

\(ii\) 5 U.S.C. 552a(d), (e)(4)(G) and (H) and (f) relate to an
individual's right to be notified of the existence of records pertaining
to such individual; requirements for identifying an individual who
requests access to records; and the agency procedures relating to access
to records and the contest of information contained in such records.
This system is exempt from the foregoing provisions for the following
reasons: To notify an individual at the individual's request of the
existence of records in an investigative file pertaining to such
individual or to grant access to an investigative file could interfere
with investigative and enforcement proceedings; constitute an
unwarranted invasion of the personal privacy of others; disclose the
identity of confidential sources and reveal confidential information
supplied by these sources and disclose investigative techniques and
procedures.

\(iii\) 5 U.S.C. 552a(e)(4)(I) requires the publication of the
categories of sources of records in each system of records. The
application of this provision could disclose investigative techniques
and procedures and cause sources to refrain from giving such information
because of fear of reprisal, or fear of breach of promises of anonymity
and confidentiality. This would compromise the ability to conduct
investigations. Even though the agency has claimed an exemption from
this particular requirement, it still plans to generally identify the
categories of records and the sources for these records in this system.
However, for the reasons stated above, this exemption is still being
cited in the event an individual wanted to know a specific source of
information.

\(iv\) 5 U.S.C. 552a(e)(1) requires each agency to maintain in its
records only such information about an individual that is relevant and
necessary to accomplish a purpose of the agency required by statute or
Executive order. This system of records is exempt from the foregoing
provision because:

\(A\) It is not possible to detect relevance or necessity of specific
information in the early stages of an investigation.

\(B\) Relevance and necessity are questions of judgment and timing. What
appears relevant and necessary when collected may ultimately be
determined to be unnecessary. It is only after the information is
evaluated that the relevance and necessity of such information can be
established.

\(C\) In interviewing persons or obtaining other forms of evidence
during an investigation, information may be supplied to the investigator
which relates to matters incidental to the main purpose of the
investigation but which is appropriate in a thorough investigation.
Oftentimes, such information cannot readily be segregated.

\(4\) The following system of records is exempt pursuant to the
provisions of 5 U.S.C. 552a(k)(5) from subsections (c)(3), (d), (e)(1),
(e)(4)(G), (H) and (I) and (f): Loan Guaranty Fee Personnel and Program
Participant Records---VA (17 VA 26).

\(5\) This exemption applies to the extent that information in this
system is subject to exemption pursuant to 5 U.S.C. 552a(k)(5).

\(6\) For the reasons set forth, the system of records listed in
paragraph (c)(4) of this section is exempt under 5 U.S.C. 552a(k)(5)
from the following provisions of 5 U.S.C. 552a:

\(i\) 5 U.S.C. 552a(c)(3) requires that an agency make accountings of
disclosures of records available to individuals named in the records at
their request. These accountings must state the date, nature and purpose
of each disclosure of the record and the name and address of the
recipient. The application of this provision would alert subjects of
background suitability investigations to the existence of the
investigation and reveal that such persons are subjects of that
investigation. Since release of such information to subjects of an
investigation would provide the subjects with significant information
concerning the nature of the investigation, it could result in revealing
the identity of a confidential source.

\(ii\) 5 U.S.C. 552a(d), (e)(4)(G) and (H) and (f) relate to an
individual's right to be notified of the existence of records pertaining
to such individual; requirements for identifying an individual who
requests access to records; and the agency procedures relating to access
to records and the contest of information contained in such records.
This system is exempt from the foregoing provisions for the following
reasons: To notify an individual at the individual's request of the
existence of records in an investigative file pertaining to such an
individual or to grant access to an investigative file would disclose
the identity of confidential sources and reveal confidential information
supplied by these sources.

\(iii\) 5 U.S.C. 552a(e)(4)(I) requires the publication of the
categories of sources of records in each system of records. The
application of this provision could disclose sufficient information to
disclose the identity of a confidential source and cause sources to
refrain from giving such information because of fear of reprisal, or
fear of breach of promises of anonymity and confidentiality. This would
compromise the ability to conduct background suitability investigations.

\(iv\) 5 U.S.C. 552a(e)(1) requires each agency to maintain in its
records only such information about an individual that is relevant and
necessary to accomplish a purpose of the agency required by statute or
Executive order. This system of records is exempt from the foregoing
provision because:

\(A\) It is not possible to detect relevance and necessity of specific
information from a confidential source in the early stages of an
investigation.

\(B\) Relevance and necessity are questions of judgment and timing. What
appears relevant and necessary when collected may ultimately be
determined to be unnecessary. It is only after the information is
evaluated that the relevance and necessity of such information can be
established regarding suitability for VA approval as a fee appraiser or
compliance inspector.

\(C\) In interviewing persons or obtaining other forms of evidence
during an investigation for suitability for VA approval, information may
be supplied to the investigator which relates to matters incidental to
the main purpose of the investigation but which is appropriate in a
thorough investigation. Oftentimes, such information cannot readily be
segregated and disclosure might jeopardize the identity of a
confidential source.

\(d\) *Exemption of Police and Security Records*. VA provides limited
access to one Security and Law Enforcement System of Records, Police and
Security Records---VA (103VA07B).

\(1\) The investigations records and reports contained in this System of
Records are exempted \[pursuant to 5 U.S.C. 552a(j)(2) of the Privacy
Act of 1974\] from Privacy Act subsections (c)(3) and (c)(4); (d);
(e)(1) through (e)(3), (e)(4)(G) through (e)(4)(I), (e)(5), and (e)(8);
(f); and (g); in addition, they are exempted \[pursuant to 5 U.S.C.
552a(k)(2) of the Privacy Act of 1974\] from Privacy Act subsections
(c)(3); (d); (e)(1), (e)(4)(G) through (e)(4)(I); and (f).

\(2\) These records contained in the Police and Security Records---VA
(103VA076B) are exempted for the following reasons:

\(i\) The application of Privacy Act subsection (c)(3) would alert
subjects to the existence of the investigation and reveal that they are
subjects of that investigation. Providing subjects with information
concerning the nature of the investigation could result in alteration or
destruction of evidence which is obtained from third parties, improper
influencing of witnesses, and other activities that could impede or
compromise the investigation.

\(ii\) The application of Privacy Act subsections (c)(4); (d); (e)(4)(G)
and (e)(4)(H); (f); and (g) could interfere with investigative and
enforcement proceedings, threaten the safety of individuals who have
cooperated with authorities, constitute an unwarranted invasion of
personal privacy of others, disclose the identity of confidential
sources, reveal confidential information supplied by these sources, and
disclose investigative techniques and procedures.

\(iii\) The application of Privacy Act subsection (e)(4)(I) could
disclose investigative techniques and procedures and cause sources to
refrain from giving such information because of fear of reprisal, or
fear of breach of promises of anonymity and confidentiality. This could
compromise the ability to conduct investigations and to identify, detect
and apprehend violators. Even though the agency has claimed an exemption
from this particular requirement, it still plans to generally identify
the categories of records and the sources of these records in this
system. However, for the reason stated in paragraph (d)(2)(ii) of this
section, this exemption is still being cited in the event an individual
wants to know a specific source of information.

\(iv\) These records contained in the Police and Security Records---VA
(103VA076B) are exempt from Privacy Act subsection (e)(1) because it is
not possible to detect the relevance or necessity of specific
information in the early stages of a criminal or other investigation.
Relevance and necessity are questions of judgment and timing. What
appears relevant and necessary may ultimately be determined to be
unnecessary. It is only after the information is evaluated that the
relevance and necessity of such information can be established. In any
investigation, the Office of Security and Law Enforcement may obtain
information concerning violations of laws other than those within the
scope of its jurisdiction. In the interest of effective law enforcement,
the Office of Security and Law Enforcement should retain this
information as it may aid in establishing patterns of criminal activity
and provide leads for those law enforcement agencies charged with
enforcing other segments of civil or criminal law.

\(v\) The application of Privacy Act subsection (e)(2) would impair
investigations of illegal acts, violations of the rules of conduct,
merit system and any other misconduct for the following reasons:

\(A\) In order to successfully verify a complaint, most information
about a complainant or an individual under investigation must be
obtained from third parties such as witnesses and informers. It is not
feasible to rely upon the subject of the investigation as a source for
information regarding his/her activities because of the subject's rights
against self-incrimination and because of the inherent unreliability of
the suspect's statements. Similarly, it is not always feasible to rely
upon the complainant as a source of information regarding his/her
involvement in an investigation.

\(B\) The subject of an investigation will be alerted to the existence
of an investigation if an attempt is made to obtain information from the
subject. This would afford the individual the opportunity to conceal any
criminal activities to avoid apprehension.

\(vi\) The reasons for exempting these records in the Police and
Security Records---VA (103VA07B) from Privacy Act subsection (e)(3) are
as follows:

\(A\) The disclosure to the subject of the purposes of the investigation
would provide the subject with substantial information relating to the
nature of the investigation and could impede or compromise the
investigation.

\(B\) Informing the complainant or the subject of the information
required by this provision could seriously interfere with undercover
activities, jeopardize the identities of undercover agents and impair
their safety, and impair the successful conclusion of the investigation.

\(C\) Individuals may be contacted during preliminary information
gathering in investigations before any individual is identified as the
subject of an investigation. Informing the individual of the matters
required by this provision would hinder or adversely affect any present
or subsequent investigations.

\(vii\) Since the Privacy Act defines "maintain" to include the
collection of information, complying with subsection (e)(5) would
prevent the collection of any data not shown to be accurate, relevant,
timely, and complete at the moment of its collection. In gathering
information during the course of an investigation, it is not always
possible to make this determination prior to collecting the information.
Facts are first gathered and then placed into a logical order which
objectively proves or disproves criminal behavior on the part of the
suspect. Material that may seem unrelated, irrelevant, incomplete,
untimely, etc., may take on added meaning as an investigation
progresses. The restrictions in this provision could interfere with the
preparation of a complete investigative report.

\(viii\) The notice requirement of Privacy Act subsection (e)(8) could
prematurely reveal an ongoing criminal investigation to the subject of
the investigation. (Authority: 5 U.S.C. 552a(j) and (k); 38 U.S.C.
501(a))

\[48 FR 29847, June 29, 1983, as amended at 68 FR 35298, June 13, 2003\]

**Supplement *Highlights* reference**: 57(1)

*Next Section is §1.600*