This section of the FEDERAL REGISTER

contains regulatory documents having general

applicability and legal effect, most of which

are keyed to and codified in the Code of

Federal Regulations, which is published under

50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by

the Superintendent of Documents. Prices of

new books are listed in the first FEDERAL

REGISTER issue of each week.

Rules and Regulations Federal Register

61301

Vol. 69, No. 200

Monday, October 18, 2004

1The CPI–U is compiled by the Bureau of 

Statistics of the Department of Labor. To calculate 

the adjustment, the FDIC used the Department of 

Labor, Bureau of Labor Statistics B All Urban 

Consumers tables to arrive at the CPI–U value.

2For penalties that were increased in 1996 but 

were not increased at the last quadrennial 

adjustment in 2000, the relevant computation is the 

CPI–U for June 1996 (156.7) and the CPI–U for June 

2003, which produces a 17.2% adjustment. If a 

penalty has never previously been adjusted (as is 

the case with the single-violation penalty under 42 

U.S.C. 4012a(f)), the maximum increase for a firsttime adjustment is 10% under 28 U.S.C 2461 note, 

rather than the 24.1% increase in the CPI–U for the 

intervening period.

FEDERAL DEPOSIT INSURANCE 

CORPORATION 

12 CFR Part 308 

RIN 3064–AC76 

Rules of Practice and Procedure

AGENCY: Federal Deposit Insurance 

Corporation.

ACTION: Final rule; correction.

SUMMARY: The Federal Civil Monetary 

Penalties Inflation Adjustment Act of 

1990, as amended, requires all Federal 

agencies with statutory authority to 

impose civil money penalties (CMPs) to 

evaluate and adjust those CMPs every 

four years. The Federal Deposit 

Insurance Corporation ((FDIC) last 

adjusted the maximum amounts of 

CMPs under its jurisdiction in 2000. 

The FDIC is issuing this final rule to 

implement the required adjustments to 

its CMPs. The FDIC is also correcting a 

technical error as to one CMP that 

occurred when the FDIC last adjusted 

CMPs in 2000.

DATES: This rule is effective on 

December 31, 2004.

FOR FURTHER INFORMATION CONTACT:

Philip P. Houle, Counsel, (202) 898–

3722, Enforcement Unit, Legal Division, 

550 17th Street, NW., Washington, DC 

20429.

SUPPLEMENTARY INFORMATION

I. Background 

The Debt Collection Improvement Act 

of 1996 (DCIA) amended section 4 of the 

Federal Civil Penalties Inflation 

Adjustment Act of 1990 (Inflation 

Adjustment Act) (28 U.S.C. 2461 note), 

to require the head of each Federal 

agency to enact regulations within 180 

days of the enactment of the DCIA and 

at least once every four years thereafter, 

to adjust each CMP provided by law 

within the jurisdiction of the agency 

(with the exception of certain 

specifically listed statutes) by the 

inflation adjustment formula set forth in 

section 5(b) of the Inflation Adjustment 

Act. 

To satisfy the requirements of the 

DCIA, the FDIC is amending 12 CFR 308 

of its regulations pertaining to its Rules 

of Practice and Procedure which 

address CMPs. The amount of each CMP 

which the FDIC has jurisdiction to 

impose has been increased according to 

the prescribed formula. The penalties 

were last adjusted in 2000 (65 FR 

64887). Any increase in penalty 

amounts under the DCIA shall apply 

only to violations which occur after the 

effective date of the increase. 

The FDIC is also implementing a 

technical correction of the maximum 

amount of tier three CMPs that may be 

assessed for violation of 12 U.S.C. 

1817(c) involving the submission of 

certified statements to the FDIC for 

determining institutions’ semiannual 

deposit insurance assessments. 

Although the FDIC had stated in the 

preamble to the 2000 final rule that the 

CMP was to be adjusted from $1,100,000 

to $1,175,000, the CMP was not actually 

adjusted due to a technical error in the 

publication of the final rule (65 FR 

64887). Under their own rulemaking, 

other Federal banking agencies did 

successfully adjust this CMP from 

$1,100,000 to $1,175,000 in 2000. 

If the $1,100,000 CMP were now 

adjusted using the 17.2% CPI figure for 

the June 1996 to June 2003 period (as 

with those CMPs that were last adjusted 

to a higher amount in 1996), this CMP’s 

maximum amount would be increased 

to $1,300,000 rather than to the lower 

$1,250,000 amount that is actually 

adopted in this final rule and correction. 

In the interests of fairness to 

respondents and consistency with other 

Federal banking agencies, the FDIC is 

making a technical correction that 

increases the $1,100,000 CMP to 

$1,175,000 for the June 1996 to June 

1999 period and also adjusts the 

corrected CMP from $1,175,000 to 

$1,250,000 for the June 2000 to June 

2003 period. 

The correction and the adjustments 

are being made simultaneously and 

prospectively. This rulemaking shall 

become a final rule on publication in 

the Federal Register and shall be 

effective as of December 31, 2004. 

Summary of Calculation 

The Inflation Adjustment Act requires 

that each CMP amount be increased by 

the ‘‘cost of living’’ adjustment, which 

is defined as the percentage by which 

the Consumer Price Index (CPI–U)1 for 

the month of June of the calendar year 

preceding the adjustment exceeds the 

CPI for the month of June of the 

calendar year in which the amount of 

the CMP was last set or adjusted 

pursuant to law. Any increase is to be 

rounded to the nearest multiple of: (A) 

$10 in the case of penalties less than or 

equal to $100; (B) $100 in the case of 

penalties greater than $100 but less than 

or equal to $1,000; (C) $1,000 in the case 

of penalties greater than $1,000 but less 

than or equal to $10,000; (D) $5,000 in 

the case of penalties greater than 

$10,000 but less than or equal to 

$100,000; (E) $10,000 in the case of 

penalties greater than $100,000 but less 

than or equal to $200,000; and (F) 

$25,000 in the case of penalties greater 

than $200,000.

Under the DCIA, the first adjustment 

may not exceed ten percent of the 

current penalty amount.2

Example 

The following example explains the 

inflation adjustment calculation for 

CMP amounts that were last adjusted in 

2000. Under 12 U.S.C. 1818(i), as 

adjusted at 12 CFR 308.132(c), the FDIC 

may impose a daily maximum Tier 

Three CMP not to exceed $1,175,000 for 

violating certain laws. 

First, the appropriate CPI–U is 

determined. The statute requires the 

FDIC to use the CPI–U for June of the 

calendar year preceding the year of 

adjustment. Since the FDIC is adjusting 

the CMP in 2004, the CPI–U for June 

2003, which was 183.7, is used. The 

statute also requires the FDIC to use the 

CPI–U for June of the year that the CMP 

61302 Federal Register / Vol. 69, No. 200 / Monday, October 18, 2004 / Rules and Regulations 

was last set by law or adjusted for 

inflation. Because the FDIC last adjusted 

the CMP in 2000, the CPI–U for June 

2000, which was 172.4, is used. 

Next, the cost of living adjustment or 

inflation factor is then calculated by 

dividing the CPI–U for June 2003 (183.7) 

by the CPI–U for June 2000 (172.4). The 

result is 1.066 (i.e., a 6.6 percent 

increase).

Third, the raw inflation adjustment is 

calculated by multiplying the maximum 

CMP amount by the percentage increase. 

In this example, $1,175,000 is 

multiplied by 6.6 percent, which equals 

$77,550. 

Fourth, the raw inflation adjusted 

amount is rounded according to the 

rounding rules in section 5(a) of the 

Inflation Adjustment Act. Under the 

rounding rules, if the penalty is greater 

than $200,000, the increase is rounded 

to the nearest multiple of $25,000. 

Therefore, the maximum penalty 

increase in this example is $75,000 (i.e., 

$77,500 rounded to the nearest multiple 

of $25,000). 

Fifth, the rounded increase is added 

to the current maximum CMP amount 

that is being adjusted. In this example, 

$1,175,000 plus $75,000 yields a new 

maximum inflation adjusted CMP 

amount of $1,250,000. 

Summary of Adjustments 

Under the Federal Civil Penalties 

Inflation Adjustment Act of 1990 (28 

U.S.C. 2461 note), the FDIC must adjust 

for inflation the civil monetary penalties 

in statutes under which it has authority 

to assess penalties. The following chart 

displays the adjusted civil money 

penalty amounts for the enumerated 

statutes. The amounts in this chart 

apply to violations that occur after 

December 31, 2004:

U.S. Code Citation Current maximum 

amount 

New maximum 

amount 

12 U.S.C. 1817(a) 

Tier One CMP .......................................................................................................................... 2,200 2,200 

Tier Two CMP .......................................................................................................................... 22,000 27,000 

Tier Three CMP ........................................................................................................................ 1,175,000 1,250,000 

12 U.S.C. 1817(c) 

Tier One CMP .......................................................................................................................... 2,200 2,200 

Tier Two CMP .......................................................................................................................... 22,000 27,000 

Tier Three CMP ........................................................................................................................ 3 1,175,000 1,250,000 

12 U.S.C. 1817(j) 

Tier One CMP .......................................................................................................................... 5,500 6,500 

Tier Two CMP .......................................................................................................................... 27,500 32,500 

Tier Three CMP ........................................................................................................................ 1,175,000 1,250,000 

12 U.S.C. 1818(i)(2) 

Tier One CMP .......................................................................................................................... 5,500 6,500 

Tier Two CMP .......................................................................................................................... 27,500 32,500 

Tier Three CMP ........................................................................................................................ 1,175,000 1,250,000 

12 U.S.C. 1820(e)(4) ....................................................................................................................... 5,500 6,500 

12 U.S.C. 1828(a)(3) ....................................................................................................................... 110 110 

12 U.S.C. 1828(h) ............................................................................................................................ 110 110 

12 U.S.C. 1829b(j) ........................................................................................................................... 11,000 11,000 

12 U.S.C. § 1832(c) ......................................................................................................................... 1,100 1,100 

12 U.S.C. 1884 ................................................................................................................................ 110 110 

12 U.S.C. 1972(2)(F) 

Tier One CMP .......................................................................................................................... 5,500 6,500 

Tier Two CMP .......................................................................................................................... 27,500 32,500 

Tier Three CMP ........................................................................................................................ 1,175,000 1,250,000 

12 U.S.C. 3108(b) 

Tier One CMP .......................................................................................................................... 5,500 6,500 

Tier Two CMP .......................................................................................................................... 27,500 32,500 

Tier Three CMP ........................................................................................................................ 1,175,000 1,250,000 

12 U.S.C. 3349(b) 

Tier One CMP .......................................................................................................................... 5,500 6,500 

Tier Two CMP .......................................................................................................................... 27,500 32,500 

Tier Three CMP ........................................................................................................................ 1,175,000 1,250,000 

12 U.S.C. 3909(d) ............................................................................................................................ 1,100 1,100 

12 U.S.C. 4717(b) 

Tier One CMP .......................................................................................................................... 5,500 6,500 

Tier Two CMP .......................................................................................................................... 27,500 32,500 

Tier Three CMP ........................................................................................................................ 1,175,000 1,250,000 

15 U.S.C. 78u–2 

Tier One CMP (individuals) ...................................................................................................... 5,500 6,500 

Tier One CMP (others) ............................................................................................................. 60,000 65,000 

Tier Two CMP (individuals) ...................................................................................................... 60,000 65,000 

Tier Two CMP (others) ............................................................................................................. 300,000 325,000 

Tier Three CMP (individuals) ................................................................................................... 120,000 130,000 

Tier Three penalty (others) ....................................................................................................... 575,000 625,000 

31 U.S.C. 3802 ................................................................................................................................ 5,500 6,500 

42 U.S.C. 4012a(f) 

Maximum CMP per violation .................................................................................................... 350 385 

Maximum CMPs per year ......................................................................................................... 115,000 125,000 

3As noted, the FDIC is simultaneously and prospectively; (A) Correcting the technical error that occurred in 2000 when this CMP was not actually adjusted, by now increasing the CMP from a maximum of $1,100,000 to $1,175,000 for the June 1996 to June 1999 period and (B) adjusting 

the CMP the maximum from $1,175,000 to $1,250,000 for the June 2000 to June 2003 period. 

Federal Register / Vol. 69, No. 200 / Monday, October 18, 2004 / Rules and Regulations 61303

II. Section-by-Section Analysis 

Section 308.116(b) 

Section 308.116(b) pertains to the 

amount of any CMP that may be 

assessed for violations of the Change in 

Bank Control Act of 1978 (12 U.S.C. 

1817(j)). This section has been amended 

by increasing the: (A) Tier One CMP 

amount from $5,500 for each day the 

violation continues to $6,500 for each 

day that the violation continues; (B) Tier 

Two CMP amount from $27,500 for each 

day that the violation continues to 

$32,500 for each day that the violation 

continues; and (C) Tier Three CMP 

amount from $1,175,000 to $1,250,000 

for each day that the violation continues 

or, in the case of a depository 

institution, increasing the CMP from an 

amount not to exceed the lesser of 

$1,250,000 or one percent of the total 

assets of the institution for each day that 

the violation continues. Section 

308.116(b)(4) has also been amended by 

revising the date after which the 

adjusted CMPs will apply to violations 

covered by § 308.116 by deleting 

‘‘November 12, 1996’’ and replacing it 

with ‘‘December 31, 2004.’’

Section 308.132

Section 308.132 pertains to the 

manner in which the FDIC assesses 

CMPs. Paragraph (c)(2) of that section 

pertains to the CMPs imposed pursuant 

to section 7(a) of the Federal Deposit 

Insurance Act (FDIA) (12 U.S.C. 1817(a)) 

for the late filing of a bank’s Reports of 

Condition and Income (Call Reports) or 

for the submission of false or misleading 

Call Reports or information. With 

respect to late filings, paragraph 

(c)(2)(ii) of § 308.132 has been amended 

to reflect the increase in the Tier Two 

CMP amount from a maximum of 

$22,000 per day to $27,000 per day for 

each day the failure to file continues. No 

change has been made to the Tier One 

CMP. Paragraph (c)(2)(ii) of § 308.132 

has also been amended by revising the 

date after which the adjusted CMPs will 

apply to violations covered by that 

paragraph by deleting ‘‘November 12, 

1996’’ and replacing it with ‘‘December 

31, 2004.’’

Paragraph (c)(2)(iii) of § 308.132 

pertains to CMPs for the submission of 

false or misleading Call Reports or 

information. Paragraph (c)(2)(iii)(B) of 

that section has been amended to reflect 

the increase in Tier Two CMP amounts 

from a maximum of $22,000 per day for 

each day that the information is not 

corrected to a maximum of $27,000 per 

day for each day that the information is 

not corrected. Paragraph (c)(2)(iii)(C) of 

that section reflects the increase in Tier 

Three CMPs from an amount not to 

exceed the lesser of $1,175,000 or one 

percent of the total assets of the 

institution for each day the information 

is not corrected to an amount not to 

exceed the lesser of $1,250,000 or one 

percent of the total assets of such 

institution for each day the information 

is not corrected. No change has been 

made to the Tier One CMP amount. 

Paragraphs (c)(2)(iii)(B) and (C) have 

also been amended by revising the date 

after which the adjusted CMPs will 

apply to violations covered by 

paragraph (c)(2)(iii) by deleting 

‘‘November 12, 1996’’ in both 

paragraphs and replacing it in both 

paragraphs with ‘‘December 31, 2004.’’

Paragraph (c)(3)(i) of § 308.132 sets 

forth the increases for CMPs assessed 

pursuant to section 8(i)(2) of the FDIA 

(12 U.S.C. 1818(i)(2)). A Tier One CMP 

will increase from a maximum of $5,500 

per day to a maximum of $6,500 per day 

for each day that the violation 

continues. A Tier Two CMP will 

increase from a maximum of $27,500 

per day to a maximum of $32,500 per 

day for each day that the violation, 

practice, or breach of fiduciary duty 

continues. A Tier Three CMP will 

increase from an amount not to exceed, 

in the case of any person other than an 

insured depository institution, 

$1,175,000 to a maximum of $1,250,000 

or, in the case of any insured depository 

institution, the amount will increase 

from a maximum of $1,175,000 to 

$1,250,000 or an amount not to exceed 

the lesser of $1,250,000 or one percent 

of the total assets of such institution for 

each day during which the violation, 

practice, or breach continues. 

Paragraph (c)(3)(i)(A) of § 308.132 lists 

a number of statutes which grant 

jurisdiction to the FDIC to assess CMPs 

under section 8(i)(2) of the FDIA for 

violation thereof, including the Home 

Mortgage Disclosure Act (12 U.S.C. 2804 

et seq. and 12 CFR 203.6), the Expedited 

Funds Availability Act (12 U.S.C. 4001 

et seq.), the Truth in Savings Act (12 

U.S.C. 4301 et seq.), the Real Estate 

Settlement Procedures Act (12 U.S.C. 

2601 et seq. and 12 CFR 3500), the 

Truth in Lending Act (15 U.S.C. 1601 et 

seq.), the Fair Credit Reporting Act (15 

U.S.C. 1681 et seq.), the Equal Credit 

Opportunity Act (15 U.S.C. 1691 et 

seq.), the Fair Debt Collection Practices 

Act (15 U.S.C. 1692 et seq.), the 

Electronic Funds Transfer Act (15 

U.S.C. 1693 et seq.), and the Fair 

Housing Act (42 U.S.C. 3601 et seq.). 

Increases in the amount of any CMP 

which the FDIC may assess for violation 

of those statutes are the same as the 

increases for CMPs under section 8(i)(2) 

of the FDIA (12 U.S.C. 1818(i)(2)) cited 

above. As in section 8(i)(2) of the FDIA, 

Tier One, Tier Two, and Tier Three 

CMP amounts will increase accordingly. 

Paragraph (c)(3)(ii) of § 308.132 

reflects the increases in CMP amounts 

that may be assessed pursuant to section 

7(c) of the FDIA (12 U.S.C. 1817(c)) for 

late filing or the submission of false or 

misleading certified statements. A Tier 

Two CMP pursuant to section 7(c)(4)(B) 

of the FDIA (12 U.S.C. 1817(c)(4)(B)) 

will increase from an amount not to 

exceed $22,000 per day to an amount 

not to exceed $27,000 for each day 

during which the failure to file 

continues or the false or misleading 

information is not corrected. As noted 

above, a Tier Three CMP which may be 

assessed pursuant to section 7(c)(4)(C) 

of the FDIA (12 U.S.C. 1817(c)(4)(B)) 

will be corrected for the June 1996 to 

June 1999 period from an amount not to 

exceed the lesser of $1,100,000 or one 

percent of the total assets of the 

institution for each day during which 

the failure to file continues or the false 

or misleading information is not 

corrected to an amount not to exceed 

the lesser of $1,175,000 or one percent 

of the total assets of the institution for 

each day during which the failure to file 

continues or the false or misleading 

information is not corrected. Also, a 

Tier Three CMP which may be assessed 

pursuant to section 7(c)(4)(C) of the 

FDIA (12 U.S.C. 1817(c)(4)(B)) will be 

adjusted for the June 2000 to June 2003 

period by increasing it from an amount 

not to exceed the lesser of $1,175,000 or 

one percent of the total assets of the 

institution for each day during which 

the failure to file continues or the false 

or misleading information is not 

corrected to an amount not to exceed 

the lesser of $1,250,000 or one percent 

of the total assets of the institution for 

each day during which the failure to file 

continues or the false or misleading 

information is not corrected. No change 

has been made to the Tier One CMP 

amount.

Paragraph (c)(3)(iii) of § 308.132 sets 

forth the increases in the CMP amounts 

that may be assessed pursuant to section 

10(e)(4) of the FDIA (12 U.S.C. 

1820(e)(4)) for refusal to allow an 

examination or to provide required 

information during an examination. The 

maximum CMP amount will increase 

from $5,500 to $6,500. 

Paragraph (c)(3)(ix) of § 308.132 sets 

forth the increases in the CMP amounts 

that may be assessed pursuant to the 

Bank Holding Company Act of 1970 for 

prohibited tying arrangements. A Tier 

One CMP which may be assessed 

pursuant to 12 U.S.C. 1972(2)(F)(i) will 

increase from a maximum of $5,500 to 

a maximum of $6,500. A Tier Two CMP 

which may be assessed under 12 U.S.C. 

61304 Federal Register / Vol. 69, No. 200 / Monday, October 18, 2004 / Rules and Regulations 

1972(2)(F)(ii) will increase from a 

maximum of $27,500 to a maximum of 

$32,500. A Tier Three CMP which may 

be assessed pursuant to 12 U.S.C. 

1972(2)(F)(iii) will increase from an 

amount not to exceed, in the case of any 

person other than an insured depository 

institution $1,175,000 for each day 

during which the violation, practice, or 

breach continues to an amount not to 

exceed $1,250,000 for each day during 

which the violation, practice, or breach 

continues. In the case of any insured 

depository institution, a Tier Three CMP 

will increase from an amount not to 

exceed the lesser of $1,175,000 or one 

percent of the total assets of such 

institution for each day during which 

the violation, practice, or breach 

continues to an amount not to exceed 

the lesser of $1,250,000 or one percent 

of the total assets of such institution for 

each day during which the violation, 

practice, or breach continues. 

Paragraph (c)(3)(x) of § 308.132 

pertains to the assessment of CMPs 

under the International Banking Act of 

1978 (IBA) (12 U.S.C. 3108(b)), for 

failure to comply with the requirements 

of the IBA, pursuant to section 8(i)(2) of 

the FDIA (12 U.S.C. 1818(i)(2)). The 

amount of these CMPs will increase in 

the amounts set forth in paragraph 

(c)(3)(i) of § 308.132 which contains the 

increases for section 8(i)(2) of the FDIA. 

Paragraph (c)(3)(xi) of § 308.132 sets 

forth the increase in CMP amounts that 

may be assessed pursuant to section 

8(i)(2) of the FDIA (12 U.S.C. 1818(i)(2)), 

as made applicable by 12 U.S.C. 

3349(b), where a financial institution 

seeks, obtains, or gives any other thing 

of value in exchange for the 

performance of an appraisal by a person 

that the institution knows is not a state 

certified or licensed appraiser in 

connection with a federally-related 

transaction. Such CMP amounts will 

increase in the amounts set forth in 

paragraph (c)(3)(i) of § 308.132 which 

contains the increases for section 8(i)(2) 

of the FDIA. 

Paragraph (c)(3)(xiii) of § 308.132 

states that pursuant to the Community 

Development Banking and Financial 

Institution Act (CDBA) (12 U.S.C. 

4717(b)) a CMP may be assessed for 

violation of the CDBA pursuant to 

section 8(i)(2) of the FDIA (12 U.S.C. 

1818(i)(2)). Such CMP amounts will 

increase in the amounts set forth in 

paragraph (c)(3)(i) of § 308.132 which 

contains the increases for section 8(i)(2) 

of the FDIA. 

Paragraph (c)(3)(xiv) of § 308.132 

states that pursuant to section 21B of the 

Securities Exchange Act of 1934 

(Exchange Act) (15 U.S.C. 78u–2), CMPs 

may be assessed for violations of certain 

provisions of the Exchange Act, where 

such penalties are in the public interest. 

The Tier One CMP amounts which may 

be assessed pursuant to 15 U.S.C. 78u–

2(b)(1) will increase from an amount not 

to exceed $5,500 for a natural person or 

$60,000 for any other person for 

violations set forth in 15 U.S.C. 78u–

2(a), to $6,500 for a natural person or 

$65,000 for any other person. The Tier 

Two CMP which may be assessed 

pursuant to 15 U.S.C. 78u–2(b)(2) for 

each violation set forth in 15 U.S.C. 

78u–2(a) will increase from an amount 

not to exceed $60,000 for a natural 

person to $300,000 for any other person 

to an amount not to exceed $65,000 for 

a natural person or $325,000 for any 

other person if the act or omission 

involved fraud, deceit, manipulation, or 

deliberate or reckless disregard of a 

regulatory requirement. The Tier Three 

CMP which may be assessed pursuant to 

15 U.S.C. 78u–2(b)(3) for each violation 

set forth in 15 U.S.C. 78u–2(a), in an 

amount not to exceed $120,000 for a 

natural person or $575,000 for any other 

person, if the act or omission involved 

fraud, deceit, manipulation, or 

deliberate or reckless disregard of a 

regulatory requirement, and such act or 

omission directly or indirectly resulted 

in substantial losses, or created a 

significant risk of substantial losses to 

other persons or resulted in substantial 

pecuniary gain to the person who 

committed the act or omission, will be 

increased to an amount not to exceed 

$130,000 for a natural person or 

$625,000 for any other person. 

Paragraph (c)(3)(xv) of § 308.132 states 

that a CMP may be assessed for 

violation of the Program Fraud Civil 

Remedies Act (31 U.S.C. 3802) for 

violations involving false claims and 

statements. The maximum CMP amount 

will increase from $5,500 to $6,500. 

Paragraph (c)(3)(xvi) of § 308.132 states 

that CMPs may be assessed pursuant to 

the Flood Disaster Protection Act 

(FDPA)(42 U.S.C. 4012a(f)) against any 

regulated lending institution that 

engages in a pattern or practice of 

violations of the FDPA. The amount of 

the maximum penalty for each violation 

will increase from an amount not to 

exceed $350 to an amount not to exceed 

$385. The maximum amount of CMPs 

which may be assessed annually against 

a regulated lending institution will 

increase from an amount not to exceed 

a total of $115,000 to an amount not to 

exceed a total of $125,000. 

Paragraph (c)(3) of § 308.132 has also 

been amended by revising the date after 

which the adjusted CMPs will apply to 

violations covered by that paragraph by 

deleting ‘‘November 12, 1996’’ and 

replacing it with ‘‘December 31, 2004.’’

III. Exemption From Public Notice and 

Comment 

The law requires the FDIC to amend 

its rules, provides the specific 

adjustments to be made and leaves the 

FDIC no discretion in calculating the 

amount of those adjustments, the 

changes are ministerial, technical, and 

noncontroversial. The FDIC has thus 

determined for good cause that public 

notice and comment is unnecessary and 

impracticable under the Administrative 

Procedure Act (5 U.S.C. 553(b)(3)(B)), 

and that the rule should be published in 

the Federal Register as a final rule. 

IV. Effective Date 

For the same reasons that the FDIC for 

good cause has determined that public 

notice and comment is unnecessary and 

impractical, the FDIC also finds that it 

has good cause to adopt an effective 

date that would be less than 30 days 

after the date of publication in the 

Federal Register pursuant to the APA (5 

U.S.C. 553(d)). In the interest of fairness, 

however, the increase in the maximum 

amount of civil money penalties in this 

regulation applies only to violations that 

occur after December 31, 2004, rather 

than to violations that occurred after the 

date of publication of this rule in the 

Federal Register. Moreover, section 302 

of the Riegle Community Development 

and Regulatory Improvement Act of 

1994 (12 U.S.C. 4802) states that a final 

rule imposing new requirements must 

take effect on the first day of a calendar 

quarter following its publication. That 

section provides, however, that an 

agency may determine that the rule 

should take effect earlier upon a finding 

of good cause. 

The FDIC also finds that the increase 

in the maximum amounts of CMPs 

under the FDIC’s jurisdiction should be 

effective as of December 31, 2004 since 

the rule is ministerial, technical, and 

noncontroversial. Under the statute, 

agencies must make the required CMP 

inflation adjustments: (A) According to 

the formula in the statute and (B) within 

four years of the last inflation 

adjustment. Federal agencies have no 

discretion as to the amount or timing of 

the adjustment. 

V. Regulatory Flexibility Act 

An initial regulatory flexibility 

analysis under the Regulatory 

Flexibility Act (RFA) (5 U.S.C. 603) is 

required only when an agency must 

publish a general notice of proposed 

rulemaking. As already noted, the FDIC 

has determined that publication of a 

notice of proposed rulemaking is not 

necessary for this final rule. 

Accordingly, the RFA does not require 

Federal Register / Vol. 69, No. 200 / Monday, October 18, 2004 / Rules and Regulations 61305

4This provision simultaneously and 

prospectively implements both the: (A) Technical 

correction for the June 1996 to June 1999 period by 

increasing the tier three CMP for violation of 12 

U.S.C. 1817(c) from $1,100,000 to $1,175,000 and 

(B) adjusts the corrected $1,175,000 CMP by 

increasing the CMP to $1,250.000 for the June 2000 

to June 2003 period.

an initial regulatory flexibility analysis. 

Nevertheless, the FDIC has considered 

the likely impact of the rule on small 

entities and believes that the rule will 

not have a significant impact on a 

substantial number of small entities. 

VI. Small Business Regulatory 

Enforcement Fairness Act 

The Small Business Regulatory 

Enforcement Fairness Act of 1996 

(SBREFA) (Public Law 104–121, 110 

Stat. 857) provides generally for 

agencies to report rules to Congress and 

for Congress to review such rules. The 

reporting requirement is triggered in 

instances where the FDIC issues a final 

rule as defined by the APA (5 U.S.C. 551 

et seq.). Because the FDIC is issuing a 

final rule as defined by the APA, the 

FDIC will file the reports required by 

the SBREFA.

The Office of Management and Budget 

has determined that this final revision 

to 12 CFR 308 does not constitute a 

‘‘major’’ rule as defined by the statute. 

VII. The Treasury and General 

Government Appropriations Act, 1999 

Assessment of Federal Regulations and 

Policies on Families 

The FDIC has determined that this 

final rule will not affect family wellbeing within the meaning of section 654 

of the Treasury and General 

Government Appropriations Act, 1999 

(Public Law No. 105–277, 112 Stat. 2681 

(1998)). 

VIII. Paperwork Reduction Act 

No collection of information pursuant 

to section 3504(h) of the Paperwork 

Reduction Act of 1980 (44 U.S.C. 3501 

et seq.) is contained in this rule. 

Consequently, no information has been 

submitted to the Office of Management 

and Budget for review. 

IX. Authority for the Regulation 

This regulation is authorized by the 

FDIC’s general rulemaking authority and 

pursuant to its fundamental 

responsibilities to ensure the safety and 

soundness of insured depository 

institutions. Specifically, 12 U.S.C. 

1819(a)(Tenth) provides the FDIC with 

general authority to issue such rules and 

regulations as it deems necessary to 

carry out the statutory mandates of the 

FDIA and other laws that the FDIC is 

charged with administering or 

enforcing.

List of Subjects in 12 CFR Part 308 

Administrative practice and 

procedure, Banks, Banking, Claims, 

Crime, Equal access to justice, Ex parte 

communications, Hearing procedure, 

Lawyers, Penalties, State nonmember 

banks.

■ For the reasons set out in the preamble, 

the FDIC amends 12 CFR 308 as follows:

PART 308—RULES OF PRACTICE AND 

PROCEDURE

■ 1. The authority for part 308 continues 

to read as follows:

Authority: 5 U.S.C. 504, 554–557; 12 

U.S.C. 93(b), 164, 505, 1815(e), 1817, 1818, 

1820, 1828, 1829, 1831i, 1831m(g)(4), 1831o, 

1831p–1, 1832(c), 1884(b), 1972, 3102, 

3108(a), 3349, 3909, 4717; 15 U.S.C. 78(h) 

and (i), 78o–4(c), 78o–5, 78q–1, 78s, 78u, 

78u–2, 78u–3, 78w, 6801(b), 6805(b)(1); 28 

U.S.C. 2461 note; 31 U.S.C. 330, 5321; 42 

U.S.C. 4012a; Sec. 3100(s), Pub. L. 104–134, 

110 Stat. 1321–358.

§ 308.116 [Amended]

■ 2. Section 308.116 is amended by:

■ a. Paragraph (b)(4) is amended by 

removing ‘‘November 12, 1996’’ and 

adding ‘‘December 31, 2004’’ in its place.

■ b. Paragraph (b)(4)(i) is amended by 

removing $5,500 and adding $6,500 in its 

place.

■ c. Paragraph (b)(4)(ii) is amended by 

removing $27,500 and adding $32,500 in 

its place.

■ d. Paragraph (b)(4)(iii)(A) is amended 

by removing $1,175,000 and adding 

$1,250,000 in its place.

■ e. Paragraph (b)(4)(iii)(B) is amended 

by removing $1,175,000 and adding 

$1,250,000 in its place.

§ 308.132 [Amended]

■ 3. Section 308.132 is amended by:

■ a. Paragraph (c)(2)(ii) is amended by 

removing ‘‘November 12, 1996’’ and 

adding ‘‘December 31, 2004’’ in its place.

■ b. Paragraph (c)(2)(ii) is amended by 

removing $22,000 and adding $27,500 in 

its place.

■ c. Paragraph (c)(2)(iii)(B) is amended 

by removing $22,000 and adding $27,500 

in its place.

■ d. Paragraph (c)(2)(iii)(B) is amended 

by removing ‘‘November 12, 1996’’ and 

adding ‘‘December 31, 2004’’ in its place.

■ e. Paragraph (c)(2)(iii)(C) is amended 

by removing $1,175,000 and adding 

$1,250,000 in its place.

■ f. Paragraph (c)(2)(iii)(C) is amended 

by removing ‘‘November 12, 1996’’ and 

adding ‘‘December 31, 2004’’ in its place.

■ g. Paragraph (c)(3) is amended by 

removing ‘‘November 12, 1996’’ and 

adding ‘‘December 31, 2004’’ in its place.

■ h. Paragraph (c)(3)(i) is amended by 

removing $5,500 and adding $6,500 in its 

place, by removing $27,500 and adding 

$32,500 in its place, and by removing 

$1,175,000 and adding $1,250,000 in its 

place.

■ i. Paragraph (c)(3)(ii) is amended by 

removing $22,000 and adding $27,000 in 

its place and by removing $1,100,000 

and adding $1,250,000 in its place.4

■ j. Paragraph (c)(3)(iii) is amended by 

removing $5,500 and adding $6,500 in its 

place.

■ k. Paragraph (c)(3)(ix) is amended by 

removing $5,500 and adding $6,500 in its 

place, by removing $27,500 and adding 

$32,500 in its place, and by removing 

$1,175,000 and adding $1,250,000 in its 

place.

■ l. In paragraph (c)(3)(xiv) by removing 

$5,500 and adding $6,500 in its place, by 

removing $60,000 and adding $65,000 in 

its place, by removing $300,000 and 

adding $325,000 in its place, by 

removing $120,000 and adding $130,000 

in its place, and by removing $575,000 

and adding $625,000 in its place.

■ m. Paragraph (c)(3)(xv) is amended by 

removing $5,500 and adding $6,500 in its 

place.

■ n. Paragraph (c)(3)(xvi) is amended by 

removing $350 and adding $385 in its 

place and by removing $115,000 and 

adding $125,000 in its place.

Dated this 12th day of October, 2004.

By order of the Board of Directors.

Federal Deposit Insurance Corporation. 

Robert E. Feldman, 

Executive Secretary.

[FR Doc. 04–23242 Filed 10–15–04; 8:45 am] 

BILLING CODE 6714–01–P

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration 

14 CFR Part 39 

[Docket No. FAA–2004–19337; Directorate 

Identifier 2004–NM–155–AD; Amendment 

39–13824; AD 2004–21–03] 

RIN 2120–AA64 

Airworthiness Directives; Gulfstream 

Model G–1159, G–1159A, G–1159B, 

and G–IV Series Airplanes

AGENCY: Federal Aviation 

Administration (FAA), DOT.

ACTION: Final rule; request for 

comments. 

SUMMARY: The FAA is adopting a new 

airworthiness directive (AD) for all 

Gulfstream Model G–1159, G–1159A, 

G–1159B, and G–IV series airplanes. 

This AD requires a one-time inspection 

of the left and right aileron and elevator