[Federal Register Volume 83, Number 9 (Friday, January 12, 2018)]
[Rules and Regulations]
[Pages 1519-1525]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-00403]


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FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Part 308

RIN 3064-AE71


Rules of Practice and Procedure

AGENCY: Federal Deposit Insurance Corporation (FDIC).

ACTION: Final rule.

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SUMMARY: The FDIC is adjusting the maximum amount of each civil money 
penalty (CMP) within its jurisdiction to account for inflation. This 
action is required by the Federal Civil Penalties Inflation Adjustment 
Act Improvements Act of 2015 (2015 Adjustment Act).

DATES: This rule is effective January 15, 2018.

FOR FURTHER INFORMATION CONTACT: Seth P. Rosebrock, Supervisory 
Counsel, Legal Division (202) 898-6609, or Graham N. Rehrig, Senior 
Attorney, Legal Division (202) 898-3829.

SUPPLEMENTARY INFORMATION:

I. Policy Objectives

    The Final Rule changes the maximum limit for CMPs according to 
inflation as mandated by Congress in the 2015 Adjustment Act.\1\ The 
intended effect of annually adjusting maximum civil money penalties in 
accordance with changes in the Consumer Price Index is to minimize any 
distortion in the real value of those maximums due to inflation, 
thereby promoting a more consistent deterrent effect in the structure 
of CMPs.
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    \1\ Public Law 114-74, sec. 701, 129 Stat. 584.
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II. Background

    The FDIC assesses CMPs under section 8(i) of the Federal Deposit 
Insurance Act (FDIA), 12 U.S.C. 1818, and a variety of other 
statutes.\2\ Congress established maximum penalties that could be 
assessed under these statutes. In many cases, these statutes contain 
multiple penalty tiers, permitting the assessment of penalties at 
various levels depending upon the severity of the misconduct at 
issue.\3\
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    \2\ See, e.g., 12 U.S.C. 1972(2)(F) (authorizing the FDIC to 
impose CMPs for violations of the Bank Holding Company Act of 1970 
related to prohibited tying arrangements); 15 U.S.C. 78u-2 
(authorizing the FDIC to impose CMPs for violations of certain 
provisions of the Securities Exchange Act of 1934); 42 U.S.C. 
4012a(f) (authorizing the FDIC to impose CMPs for pattern or 
practice violations of the Flood Disaster Protection Act).
    \3\ For example, Section 8(i)(2) of the FDIA, 12 U.S.C. 
1818(i)(2), provides for three tiers of CMPs, with the size of such 
CMPs increasing with the gravity of the misconduct.
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    In 1990, Congress determined that the assessment of CMPs plays ``an 
important role in deterring violations and furthering the policy goals 
embodied in such laws and regulations'' and concluded that ``the impact 
of many civil monetary penalties has been and is diminished due to the 
effect of inflation.'' \4\ Consequently, Congress required federal 
agencies with authority to impose CMPs to periodically adjust by 
rulemaking the maximum CMPs which these agencies were authorized to 
impose in order to ``maintain the deterrent effect of civil monetary 
penalties and promote compliance with the law.'' \5\ Under the 1990 
Adjustment Act, the FDIC adjusted its CMP amounts every four years.\6\
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    \4\ Section 2 of the Federal Civil Penalties Inflation 
Adjustment Act of 1990 (1990 Adjustment Act). Public Law 101-410, 
104 Stat. 890 (amended 2015) (codified as amended at 28 U.S.C. 2461 
note).
    \5\ Id.
    \6\ See, e.g., 77 FR 74573 (Dec. 17, 2012).
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    In 2015, Congress revised the process by which federal agencies 
adjust applicable CMPs for inflation.\7\ Under the 2015 Adjustment Act, 
the FDIC is required to make annual adjustments for inflation.\8\ These 
adjustments apply to all CMPs covered by the 2015 Adjustment Act.\9\ 
The 2015 Adjustment Act requires annual adjustments to be made by 
January 15 of each year.\10\
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    \7\ See Public Law 114-74, sec. 701, 129 Stat. 584.
    \8\ See id. at sec. 701(b).
    \9\ See Public Law 101-410, sec. 3(2), 104 Stat. 890 (amended 
2015) (codified as amended at 28 U.S.C. 2461 note).
    \10\ Public Law 114-74, sec. 701(b), 129 Stat. 584.
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    Although the 2015 Adjustment Act increases the maximum penalty that 
may be assessed under each applicable statute, the FDIC possesses 
discretion to impose CMP amounts below the maximum level in accordance 
with the severity of the misconduct at issue. For example, when making 
a determination as to the appropriate level of a penalty assessed under 
section 8(i)(2) of the FDIA, 12 U.S.C. 1818(i)(2), the FDIC is guided 
by statutory factors set forth in section 8(i)(2)(G) of the FDIA, 12 
U.S.C. 1818(i)(2)(G), and those factors identified in the Interagency 
Policy Statement Regarding the Assessment of CMPs by the Federal 
Financial Institutions Regulatory Agencies.\11\ Such factors include, 
but are not limited to, the gravity and duration of the misconduct, and 
the intent related to the misconduct.
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    \11\ 63 FR 30227 (June 3, 1998).
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    The 2015 Adjustment Act notes that the FDIC ``shall adjust [CMPs] 
and shall make the adjustment notwithstanding section 553 of title 5, 
United States Code'' (the Administrative Procedure Act).\12\ The FDIC, 
therefore, is not obligated to publish the adjustments through notice-
and-comment rulemaking, and the FDIC is publishing the adjustments 
through a final rule.
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    \12\ Public Law 114-74, sec. 701(b), 129 Stat. 584 (emphasis 
added).
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III. Description and Expected Effects of the Final Rule

    The Final Rule modifies the maximum limit for CMPs according to 
inflation as mandated by Congress in the 2015 Adjustment Act. The 2015 
Adjustment Act directs federal agencies to follow guidance issued by 
the Office of Management and Budget (OMB) on December 15, 2017 (OMB 
Guidance), when calculating new maximum penalty levels.\13\ The 
adjustments are to be based on the percent change between the Consumer 
Price Index for all Urban Consumers (CPI-U)\14\ for October 2016 and 
the October 2017 CPI-U.
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    \13\ See OMB, Implementation of Penalty Inflation Adjustments 
for 2018, Pursuant to the Federal Civil Penalties Inflation 
Adjustment Act Improvements Act of 2015, M-18-03 (Dec. 15, 2017), 
available at https://www.whitehouse.gov/wp-content/uploads/2017/11/M-18-03.pdf (noting that the applicable 2018 CMP-adjustment 
multiplier is 1.02041).
    \14\ The CPI-U is compiled by the Bureau of Labor Statistics of 
the Department of Labor.

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[[Page 1520]]

Summary of the FDIC's Calculations

    During the 12-month period ending October 2017, the CPI-U was 
reported to have increased by 2.041 percent. In keeping with the OMB 
Guidance, the FDIC adjusted each of its CMP maximum penalty levels by 
the inflation factor.\15\ After applying the adjustment, the FDIC 
rounded each penalty level to the nearest dollar. In making these 
calculations, the FDIC consulted with staff from the Office of the 
Comptroller of the Currency, the Board of Governors for the Federal 
Reserve System, the National Credit Union Administration, and the 
Bureau of Consumer Financial Protection to ensure that the FDIC's 
adjusted figures were consistent with these regulators' respective 
amounts.
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    \15\ Under the 1990 Adjustment Act, adjustments have been made 
only to CMPs that are for specific dollar amounts or maximums. CMPs 
that are assessed based upon a fixed percentage of an institution's 
total assets are not subject to adjustment.
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The Adjusted CMP Amounts

    The following chart displays the adjusted CMP amounts for each CMP 
identified in 12 CFR part 308.\16\ The following chart reflects the 
maximum CMP amounts that may be assessed after January 15, 2018--the 
effective date of the 2018 annual adjustment--including assessments 
whose associated violations occurred on or after November 2, 2015.\17\
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    \16\ As noted previously, the FDIC retains discretion to impose 
CMPs in amounts below the referenced maximums.
    \17\ See OMB Guidance at 4.

                                       Maximum Civil Money Penalty Amounts
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                                                Current maximum CMP  (through   Adjusted maximum CMP  (beginning
             U.S. Code citation                       January 14, 2018)                 January 15, 2018)
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12 U.S.C. 1464(v):
    Tier One CMP............................                            $3,849                            $3,928
    Tier Two CMP............................                            38,492                            39,278
    Tier Three CMP..........................                         1,924,589                         1,963,870
12 U.S.C. 1467(d)...........................                             9,623                             9,819
12 U.S.C. 1817(a):
    Tier One CMP............................                             3,849                             3,928
    Tier Two CMP............................                            38,492                            39,278
    Tier Three CMP..........................                         1,924,589                         1,963,870
12 U.S.C. 1817(c):
    Tier One CMP............................                             3,519                             3,591
    Tier Two CMP............................                            35,186                            35,904
    Tier Three CMP..........................                         1,759,309                         1,795,216
12 U.S.C. 1818(i)(2):
    Tier One CMP............................                             9,623                             9,819
    Tier Two CMP............................                            48,114                            49,096
    Tier Three CMP..........................                         1,924,589                         1,963,870
12 U.S.C. 1820(e)(4)........................                             8,797                             8,977
12 U.S.C. 1820(k)(6)........................                           316,566                           323,027
12 U.S.C. 1828(a)(3)........................                               120                               122
12 U.S.C. 1828(h):
    For assessments <$10,000................                               120                               122
12 U.S.C. 1829b(j)..........................                            20,111                            20,521
12 U.S.C. 1832(c)...........................                             2,795                             2,852
12 U.S.C. 1884..............................                               279                               285
12 U.S.C. 1972(2)(F):
    Tier One CMP............................                             9,623                             9,819
    Tier Two CMP............................                            48,114                            49,096
    Tier Three CMP..........................                         1,924,589                         1,963,870
12 U.S.C. 3909(d)...........................                             2,394                             2,443
15 U.S.C. 78u-2:
    Tier One CMP (individuals)..............                             9,054                             9,239
    Tier One CMP (others)...................                            90,535                            92,383
    Tier Two CMP (individuals)..............                            90,535                            92,383
    Tier Two CMP (others)...................                           452,677                           461,916
    Tier Three CMP (individuals)............                           181,071                           184,767
    Tier Three penalty (others).............                           905,353                           923,831
15 U.S.C. 1639e(k):
    First violation.........................                            11,053                            11,279
    Subsequent violations...................                            22,105                            22,556
31 U.S.C. 3802..............................                            10,957                            11,181
42 U.S.C. 4012a(f)..........................                             2,090                             2,133
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                                              Current maximum amount  (through   New maximum amount  (beginning
                CFR Citation                          January 14, 2018)                 January 15, 2018)
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12 CFR 308.132(c)--Late or Misleading
 Reports of Condition and Income (Call
 Reports):
    First Offense:
        $25 million or more assets:
            1 to 15 days late...............                               527                               538
            16 or more days late............                             1,056                             1,078

[[Page 1521]]

 
        Less than $25 million assets
            1 to 15 days late...............                               176                               180
            16 or more days late............                               352                               359
    Subsequent Offenses:
        $25 million or more assets:
            1 to 15 days late...............                               879                               897
            16 or more days late............                             1,759                             1,795
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The Expected Effects of the CMP Adjustments

    These CMP adjustments are expected to minimize any year-to-year 
distortions in the real value of the CMP maximums. Additionally, these 
adjustments will promote a more consistent deterrent effect in the 
structure of CMPs. As previously noted, the FDIC retains discretion to 
impose CMP amounts below the maximum level. The actual number and size 
of CMPs assessed in the future will depend on the propensity and 
severity of the violations committed by banks and institution-
affiliated parties, as well as the particular statute that is at issue. 
Such future violations cannot be reliably forecast. It is expected that 
the FDIC will continue to exercise its discretion to impose CMPs that 
are appropriate to their severity.
    The 2015 Adjustment Act will likely result in a minimal increase in 
administrative costs for the FDIC in order to establish new inflation-
adjusted maximum CMPs each year. Because these calculations are 
relatively simple, the number of labor hours necessary to perform this 
task is likely to be insignificant relative to total enforcement labor 
hours for the Corporation.

IV. Alternatives Considered

    The 2015 Adjustment Act mandates the frequency of the inflation 
adjustment and the measure of inflation to be used in making these 
adjustments. This statute also provides that the FDIC is not required 
to proceed through notice-and-comment rulemaking under the 
Administrative Procedure Act in making annual CMP adjustments. 
Therefore, the FDIC has not considered alternatives to the CMP 
Adjustments.

V. Request for Comment

    The 2015 Adjustment Act requires the FDIC to adjust its maximum CMP 
amounts ``notwithstanding section 553 of title 5, United States Code,'' 
\18\ and provides the specific adjustments to be made. Moreover, the 
CMP Adjustments and the revisions to the CFR are ministerial and 
technical; therefore, the FDIC is not required to complete a notice-
and-comment rulemaking process prior to making the adjustments.
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    \18\ Public Law 114-74, sec. 701(b), 129 Stat. 584.
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VI. Regulatory Analysis

Riegle Community Development and Regulatory Improvement Act

    Section 302 of the Riegle Community Development and Regulatory 
Improvement Act \19\ generally requires that regulations prescribed by 
federal banking agencies which impose additional reporting, 
disclosures, or other new requirements on insured depository 
institutions take effect on the first day of a calendar quarter unless 
the regulation is required to take effect on another date pursuant to 
another act of Congress or the agency determines for good cause that 
the regulation should become effective on an earlier date.
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    \19\ 12 U.S.C. 4802.
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    This Final Rule does not impose any new or additional reporting, 
disclosures, or other requirements on insured depository institutions. 
Therefore, the Final Rule is not subject to the requirements of this 
statute.

Regulatory Flexibility Act

    An initial regulatory flexibility analysis under the Regulatory 
Flexibility Act \20\ (RFA) is required only when an agency must publish 
a general notice of proposed rulemaking. As noted above, the FDIC 
determined that publication of a notice of proposed rulemaking is not 
necessary for the Final Rule. Accordingly, the RFA does not require an 
initial regulatory flexibility analysis. Nevertheless, the FDIC 
considered the likely impact of Final Rule on small entities. From 2011 
through 2016, on average, only 1.4 percent of FDIC-supervised 
institutions were ordered to pay a CMP each year. Accordingly, the FDIC 
believes that the Final Rule will not have a significant impact on a 
substantial number of small entities.
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    \20\ 5 U.S.C. 603.
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Small Business Regulatory Enforcement Fairness Act

    The OMB has determined that the Final Rule is not a ``major rule'' 
within the meaning of the relevant sections of the Small Business 
Regulatory Enforcement Act of 1996 (SBREFA).\21\ As required by SBREFA, 
the FDIC will submit the Final Rule and other appropriate reports to 
Congress and the Government Accountability Office for review.
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    \21\ 5 U.S.C. 801 et seq.
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The Omnibus Consolidated and Emergency Supplemental Appropriations Act, 
1999: Assessment of Federal Regulations and Policies on Families

    The FDIC determined that the Final Rule will not affect family 
wellbeing within the meaning of section 654 of the Omnibus Consolidated 
and Emergency Supplemental Appropriations Act, 1999.\22\
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    \22\ Public Law 105-277, 112 Stat. 2681 (1998).
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Paperwork Reduction Act

    The Final Rule does not create any new, or revise any existing, 
collections of information under section 3504(h) of the Paperwork 
Reduction Act of 1980.\23\ Consequently, no information collection 
request will be submitted to the OMB for review.
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    \23\ 44 U.S.C. 3501 et seq.
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Plain Language Act

    Section 722 of the Gramm-Leach-Bliley Act requires the FDIC to use 
plain language in all proposed and final rules published after January 
1, 2000.\24\ Accordingly, the FDIC has attempted to write the Final 
Rule in clear and comprehensible language.
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    \24\ Public Law 106-102, 113 Stat. 1338 (Nov. 12, 1999).
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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.


[[Page 1522]]


    For the reasons set forth in the preamble, the FDIC amends 12 CFR 
part 308 as follows:

PART 308--RULES OF PRACTICE AND PROCEDURE

0
1. The authority citation for part 308 continues to read as follows:

    Authority:  5 U.S.C. 504, 554-557; 12 U.S.C. 93(b), 164, 505, 
1464, 1467(d), 1467a, 1468, 1815(e), 1817, 1818, 1819, 1820, 1828, 
1829, 1829(b), 1831i, 1831m(g)(4), 1831o, 1831p-1, 1832(c), 1884(b), 
1972, 3102, 3108(a), 3349, 3909, 4717, 5412(b)(2)(C), 5414(b)(3); 15 
U.S.C. 78(h) and (i), 78o(c)(4), 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; Pub. L. 104-134, sec. 31001(s), 
110 Stat. 1321; Pub. L. 109-351, 120 Stat. 1966; Pub. L. 111-203, 
124 Stat. 1376; Pub. L. 114-74, sec. 701, 129 Stat. 584.

0
2. Revise Sec.  308.116(b)(4) to read as follows:


Sec.  308.116  Assessment of penalties.

* * * * *
    (b) * * *
    (4) Adjustment of civil money penalties by the rate of inflation 
pursuant to the Federal Civil Penalties Inflation Adjustment Act 
Improvements Act of 2015. After January 15, 2018, for violations that 
occurred on or after November 2, 2015:
    (i) Any person who has engaged in a violation as set forth in 
paragraph (b)(1) of this section shall forfeit and pay a civil money 
penalty of not more than $9,819 for each day the violation continued.
    (ii) Any person who has engaged in a violation, unsafe or unsound 
practice or breach of fiduciary duty, as set forth in paragraph (b)(2) 
of this section, shall forfeit and pay a civil money penalty of not 
more than $49,096 for each day such violation, practice or breach 
continued.
    (iii) Any person who has knowingly engaged in a violation, unsafe 
or unsound practice or breach of fiduciary duty, as set forth in 
paragraph (b)(3) of this section, shall forfeit and pay a civil money 
penalty not to exceed:
    (A) In the case of a person other than a depository institution--
$1,963,870 per day for each day the violation, practice or breach 
continued; or
    (B) In the case of a depository institution--an amount not to 
exceed the lesser of $1,963,870 or one percent of the total assets of 
such institution for each day the violation, practice or breach 
continued.
* * * * *

0
3. Revise Sec.  308.132(d) to read as follows:


Sec.  308.132  Assessment of penalties.

* * * * *
    (d) Maximum civil money penalty amounts. Pursuant to the Federal 
Civil Penalties Inflation Adjustment Act Improvements Act of 2015, 
after January 15, 2018, for violations that occurred on or after 
November 2, 2015, the Board of Directors or its designee may assess 
civil money penalties in the maximum amounts as follows:
    (1) Civil money penalties assessed pursuant to 12 U.S.C. 1464(v) 
for late filing or the submission of false or misleading certified 
statements by State savings associations. Pursuant to section 5(v) of 
the Home Owners' Loan Act (12 U.S.C. 1464(v)), the Board of Directors 
or its designee may assess civil money penalties as follows:
    (i) Late filing--Tier One penalties. In cases in which an 
institution fails to make or publish its Report of Condition and Income 
(Call Report) within the appropriate time periods, a civil money 
penalty of not more than $3,928 per day may be assessed where the 
institution maintains procedures in place reasonably adapted to avoid 
inadvertent error and the late filing occurred unintentionally and as a 
result of such error; or the institution inadvertently transmitted a 
Call Report that is minimally late. For penalties assessed after 
January 15, 2018, for violations of this paragraph (d)(1)(i) that 
occurred on or after November 2, 2015, the following maximum Tier One 
penalty amounts contained in paragraphs (d)(1)(i)(A) and (B) of this 
section shall apply for each day that the violation continues.
    (A) First offense. Generally, in such cases, the amount assessed 
shall be $538 per day for each of the first 15 days for which the 
failure continues, and $1,078 per day for each subsequent day the 
failure continues, beginning on the sixteenth day. For institutions 
with less than $25,000,000 in assets, the amount assessed shall be the 
greater of $180 per day or 1/1000th of the institution's total assets 
(1/10th of a basis point) for each of the first 15 days for which the 
failure continues, and $359 or 1/500th of the institution's total 
assets, \1/5\ of a basis point) for each subsequent day the failure 
continues, beginning on the sixteenth day.
    (B) Subsequent offense. Where the institution has been delinquent 
in making or publishing its Call Report within the preceding five 
quarters, the amount assessed for the most current failure shall 
generally be $897 per day for each of the first 15 days for which the 
failure continues, and $1,795 per day for each subsequent day the 
failure continues, beginning on the sixteenth day. For institutions 
with less than $25,000,000 in assets, those amounts, respectively, 
shall be 1/500th of the bank's total assets and 1/250th of the 
institution's total assets.
    (C) Lengthy or repeated violations. The amounts set forth in this 
paragraph (d)(1)(i) will be assessed on a case-by-case basis where the 
amount of time of the institution's delinquency is lengthy or the 
institution has been delinquent repeatedly in making or publishing its 
Call Reports.
    (D) Waiver. Absent extraordinary circumstances outside the control 
of the institution, penalties assessed for late filing shall not be 
waived.
    (ii) Late-filing--Tier Two penalties. Where an institution fails to 
make or publish its Call Report within the appropriate time period, the 
Board of Directors or its designee may assess a civil money penalty of 
not more than $39,278 per day for each day the failure continues.
    (iii) False or misleading reports or information--(A) Tier One 
penalties. In cases in which an institution submits or publishes any 
false or misleading Call Report or information, the Board of Directors 
or its designee may assess a civil money penalty of not more than 
$3,928 per day for each day the information is not corrected, where the 
institution maintains procedures in place reasonably adapted to avoid 
inadvertent error and the violation occurred unintentionally and as a 
result of such error; or the institution inadvertently transmits a Call 
Report or information that is false or misleading.
    (B) Tier Two penalties. Where an institution submits or publishes 
any false or misleading Call Report or other information, the Board of 
Directors or its designee may assess a civil money penalty of not more 
than $39,278 per day for each day the information is not corrected.
    (C) Tier Three penalties. Where an institution knowingly or with 
reckless disregard for the accuracy of any Call Report or information 
submits or publishes any false or misleading Call Report or other 
information, the Board of Directors or its designee may assess a civil 
money penalty of not more than the lesser of $1,963,870 or 1 percent of 
the institution's total assets per day for each day the information is 
not corrected.
    (iv) Mitigating factors. The amounts set forth in this paragraph 
(d)(1) may be reduced based upon the factors set forth in paragraph (b) 
of this section.
    (2) Civil money penalties assessed pursuant to 12 U.S.C. 1467(d) 
for refusal by an affiliate of a State savings association to allow 
examination or to provide required information during an

[[Page 1523]]

examination. Pursuant to section 9(d) of the Home Owners' Loan Act (12 
U.S.C. 1467(d)), civil money penalties may be assessed against any 
State savings association if an affiliate of such an institution 
refuses to permit a duly-appointed examiner to conduct an examination 
or refuses to provide information during the course of an examination 
as set forth 12 U.S.C. 1467(d), in an amount not to exceed $9,819 for 
each day the refusal continues.
    (3) Civil money penalties assessed pursuant to 12 U.S.C. 1817(a) 
for late filings or the submission of false or misleading reports of 
condition. Pursuant to section 7(a) of the FDIA (12 U.S.C. 1817(a)), 
the Board of Directors or its designee may assess civil money penalties 
as follows:
    (i) Late filing--Tier One penalties. In cases in which an 
institution fails to make or publish its Report of Condition and Income 
(Call Report) within the appropriate time periods, a civil money 
penalty of not more than $3,928 per day may be assessed where the 
institution maintains procedures in place reasonably adapted to avoid 
inadvertent error and the late filing occurred unintentionally and as a 
result of such error; or the institution inadvertently transmitted a 
Call Report that is minimally late. For penalties assessed after 
January 15, 2018, for violations of this paragraph (d)(3)(i) that 
occurred on or after November 2, 2015, the following maximum Tier One 
penalty amounts contained in paragraphs (d)(3)(i)(A) and (B) of this 
section shall apply for each day that the violation continues.
    (A) First offense. Generally, in such cases, the amount assessed 
shall be $538 per day for each of the first 15 days for which the 
failure continues, and $1,078 per day for each subsequent day the 
failure continues, beginning on the sixteenth day. For institutions 
with less than $25,000,000 in assets, the amount assessed shall be the 
greater of $180 per day or 1/1000th of the institution's total assets 
(1/10th of a basis point) for each of the first 15 days for which the 
failure continues, and $359 or 1/500th of the institution's total 
assets, (\1/5\ of a basis point) for each subsequent day the failure 
continues, beginning on the sixteenth day.
    (B) Subsequent offense. Where the institution has been delinquent 
in making or publishing its Call Report within the preceding five 
quarters, the amount assessed for the most current failure shall 
generally be $897 per day for each of the first 15 days for which the 
failure continues, and $1,795 per day for each subsequent day the 
failure continues, beginning on the sixteenth day. For institutions 
with less than $25,000,000 in assets, those amounts, respectively, 
shall be 1/500th of the bank's total assets and 1/250th of the 
institution's total assets.
    (C) Lengthy or repeated violations. The amounts set forth in this 
paragraph (d)(3)(i) will be assessed on a case-by-case basis where the 
amount of time of the institution's delinquency is lengthy or the 
institution has been delinquent repeatedly in making or publishing its 
Call Reports.
    (D) Waiver. Absent extraordinary circumstances outside the control 
of the institution, penalties assessed for late filing shall not be 
waived.
    (ii) Late-filing--Tier Two penalties. Where an institution fails to 
make or publish its Call Report within the appropriate time period, the 
Board of Directors or its designee may assess a civil money penalty of 
not more than $39,278 per day for each day the failure continues.
    (iii) False or misleading reports or information--(A) Tier One 
penalties. In cases in which an institution submits or publishes any 
false or misleading Call Report or information, the Board of Directors 
or its designee may assess a civil money penalty of not more than 
$3,928 per day for each day the information is not corrected, where the 
institution maintains procedures in place reasonably adapted to avoid 
inadvertent error and the violation occurred unintentionally and as a 
result of such error; or the institution inadvertently transmits a Call 
Report or information that is false or misleading.
    (B) Tier Two penalties. Where an institution submits or publishes 
any false or misleading Call Report or other information, the Board of 
Directors or its designee may assess a civil money penalty of not more 
than $39,278 per day for each day the information is not corrected.
    (C) Tier Three penalties. Where an institution knowingly or with 
reckless disregard for the accuracy of any Call Report or information 
submits or publishes any false or misleading Call Report or other 
information, the Board of Directors or its designee may assess a civil 
money penalty of not more than the lesser of $1,963,870 or 1 percent of 
the institution's total assets per day for each day the information is 
not corrected.
    (iv) Mitigating factors. The amounts set forth in this paragraph 
(d)(3) may be reduced based upon the factors set forth in paragraph (b) 
of this section.
    (4) Civil money penalties assessed pursuant to 12 U.S.C. 1817(c) 
for late filing or the submission of false or misleading certified 
statements. Tier One civil money penalties may be assessed pursuant to 
section 7(c)(4)(A) of the FDIA (12 U.S.C. 1817(c)(4)(A)) in an amount 
not to exceed $3,591 for each day during which the failure to file 
continues or the false or misleading information is not corrected. Tier 
Two civil money penalties may be assessed pursuant to section 
7(c)(4)(B) of the FDIA (12 U.S.C. 1817(c)(4)(B)) in an amount not to 
exceed $35,904 for each day during which the failure to file continues 
or the false or misleading information is not corrected. Tier Three 
civil money penalties may be assessed pursuant to section 7(c)(4)(C) in 
an amount not to exceed the lesser of $1,795,216 or 1 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.
    (5) Civil money penalties assessed pursuant to section 8(i)(2) of 
the FDIA. Tier One civil money penalties may be assessed pursuant to 
section 8(i)(2)(A) of the FDIA (12 U.S.C. 1818(i)(2)(A)) in an amount 
not to exceed $9,819 for each day during which the violation continues. 
Tier Two civil money penalties may be assessed pursuant to section 
8(i)(2)(B) of the FDIA (12 U.S.C. 1818(i)(2)(B)) in an amount not to 
exceed $49,096 for each day during which the violation, practice or 
breach continues. Tier Three civil money penalties may be assessed 
pursuant to section 8(i)(2)(C) (12 U.S.C. 1818(i)(2)(C)) in an amount 
not to exceed, in the case of any person other than an insured 
depository institution $1,963,870 or, in the case of any insured 
depository institution, an amount not to exceed the lesser of 
$1,963,870 or 1 percent of the total assets of such institution for 
each day during which the violation, practice, or breach continues.
    (i) Pursuant to 7(j)(16) of the FDIA (12 U.S.C. 1817(j)(16)), a 
civil money penalty may be assessed for violations of change in control 
of insured depository institution provisions pursuant to section 
8(i)(2) of the FDIA (12 U.S.C. 1818(i)(2)) in the amounts set forth in 
this paragraph (d)(5).
    (ii) Pursuant to the International Banking Act of 1978 (IBA) (12 
U.S.C. 3108(b)), civil money penalties may be assessed 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)), in the amounts set forth in this 
paragraph (d)(5).
    (iii) Pursuant to section 1120(b) of the Financial Institutions 
Recovery, Reform, and Enforcement Act of 1989 (FIRREA) (12 U.S.C. 
3349(b)), where a financial institution seeks, obtains, or gives any

[[Page 1524]]

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, 
a civil money penalty may be assessed pursuant to section 8(i)(2) of 
the FDIA (12 U.S.C. 1818(i)(2)) in the amounts set forth in this 
paragraph (d)(5).
    (iv) Pursuant to the Community Development Banking and Financial 
Institution Act (Community Development Banking Act) (12 U.S.C. 4717(b)) 
a civil money penalty may be assessed for violations of the Community 
Development Banking Act pursuant to section 8(i)(2) of the FDIA (12 
U.S.C. 1818(i)(2)), in the amount set forth in this paragraph (d)(5).
    (v) Civil money penalties may be assessed pursuant to section 
8(i)(2) of the FDIA in the amounts set forth in this paragraph (d)(5) 
for violations of various consumer laws, including, but not limited to, 
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.), 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.).
    (6) Civil money penalties assessed pursuant to 12 U.S.C. 1820(e) 
for refusal to allow examination or to provide required information 
during an examination. Pursuant to section 10(e)(4) of the FDIA (12 
U.S.C. 1820(e)(4)), civil money penalties may be assessed against any 
affiliate of an insured depository institution that refuses to permit a 
duly-appointed examiner to conduct an examination or to provide 
information during the course of an examination as set forth in section 
20(b) of the FDIA (12 U.S.C. 1820(b)), in an amount not to exceed 
$8,977 for each day the refusal continues.
    (7) Civil money penalties assessed pursuant to 12 U.S.C. 1820(k) 
for violation of one-year restriction on Federal examiners of financial 
institutions. Pursuant to section 10(k) of the FDIA (12 U.S.C. 
1820(k)), the Board of Directors or its designee may assess a civil 
money penalty of up to $323,027 against any covered former Federal 
examiner of a financial institution who, in violation of section 10(k) 
of the FDIA (12 U.S.C. 1820(k)) and within the one-year period 
following termination of government service as an employee, serves as 
an officer, director, or consultant of a financial or depository 
institution, a holding company, or of any other entity listed in 
section 10(k) of the FDIA (12 U.S.C. 1820(k)), without the written 
waiver or permission by the appropriate Federal banking agency or 
authority under section 10(k)(5) of the FDIA (12 U.S.C. 1820(k)(5)).
    (8) Civil money penalties assessed pursuant to 12 U.S.C. 1828(a) 
for incorrect display of insurance logo. Pursuant to section 18(a)(3) 
of the FDIA (12 U.S.C. 1828(a)(3)), civil money penalties may be 
assessed against an insured depository institution that fails to 
correctly display its insurance logo pursuant to that section, in an 
amount not to exceed $122 for each day the violation continues.
    (9) Civil money penalties assessed pursuant to 12 U.S.C. 1828(h) 
for failure to timely pay assessment--(i) In general. Subject to 
paragraph (d)(9)(iii) of this section, any insured depository 
institution that fails or refuses to pay any assessment shall be 
subject to a penalty in an amount of not more than 1 percent of the 
amount of the assessment due for each day that such violation 
continues.
    (ii) Exception in case of dispute. Paragraph (d)(9)(i) of this 
section shall not apply if--
    (A) The failure to pay an assessment is due to a dispute between 
the insured depository institution and the Corporation over the amount 
of such assessment; and
    (B) The insured depository institution deposits security 
satisfactory to the Corporation for payment upon final determination of 
the issue.
    (iii) Special rule for small assessment amounts. If the amount of 
the assessment that an insured depository institution fails or refuses 
to pay is less than $10,000 at the time of such failure or refusal, the 
amount of any penalty to which such institution is subject under 
paragraph (d)(9)(i) of this section shall not exceed $122 for each day 
that such violation continues.
    (iv) Authority to modify or remit penalty. The Corporation, in the 
sole discretion of the Corporation, may compromise, modify, or remit 
any penalty that the Corporation may assess or has already assessed 
under paragraph (d)(9)(i) of this section upon a finding that good 
cause prevented the timely payment of an assessment.
    (10) Civil money penalties assessed pursuant to 12 U.S.C. 1829b(j) 
for recordkeeping violations. Pursuant to section 19b(j) of the FDIA 
(12 U.S.C. 1829b(j)), civil money penalties may be assessed against an 
insured depository institution and any director, officer or employee 
thereof who willfully or through gross negligence violates or causes a 
violation of the recordkeeping requirements of that section or its 
implementing regulations in an amount not to exceed $20,521 per 
violation.
    (11) Civil money penalties pursuant to 12 U.S.C. 1832(c) for 
violation of provisions regarding interest-bearing demand deposit 
accounts. Pursuant to 12 U.S.C. 1832(c), any depository institution 
that violates the prohibition regarding interest-bearing demand deposit 
accounts shall be subject to a fine of $2,852 per violation.
    (12) Civil penalties for violations of security measure 
requirements under 12 U.S.C. 1884. Pursuant to 12 U.S.C. 1884, an 
institution that violates a rule establishing minimum security 
requirements as set forth in 12 U.S.C. 1882, shall be subject to a 
civil penalty not to exceed $285 for each day of the violation.
    (13) Civil money penalties assessed pursuant to 12 U.S.C. 
1972(2)(F) for prohibited tying arrangements. Pursuant to the Bank 
Holding Company Act of 1970, Tier One civil money penalties may be 
assessed pursuant to 12 U.S.C. 1972(2)(F)(i) in an amount not to exceed 
$9,819 for each day during which the violation continues. Tier Two 
civil money penalties may be assessed pursuant to 12 U.S.C. 
1972(2)(F)(ii) in an amount not to exceed $49,096 for each day during 
which the violation, practice or breach continues. Tier Three civil 
money penalties may be assessed pursuant to 12 U.S.C. 1972(2)(F)(iii) 
in an amount not to exceed, in the case of any person other than an 
insured depository institution $1,963,870 for each day during which the 
violation, practice, or breach continues or, in the case of any insured 
depository institution, an amount not to exceed the lesser of 
$1,963,870 or 1 percent of the total assets of such institution for 
each day during which the violation, practice, or breach continues.
    (14) Civil money penalties assessed pursuant to 12 U.S.C. 3909(d). 
Pursuant to the International Lending Supervision Act (ILSA) (12 U.S.C. 
3909(d)), civil money penalties may be assessed against any institution 
or any officer, director, employee, agent or other person participating 
in the conduct of the affairs of such institution is an amount not to 
exceed $2,443 for each day a violation of the ILSA or any rule, 
regulation or order issued pursuant to ILSA continues.
    (15) Civil money penalties assessed for violations of 15 U.S.C. 
78u-2.

[[Page 1525]]

Pursuant to section 21B of the Securities Exchange Act of 1934 
(Exchange Act) (15 U.S.C. 78u-2), civil money penalties may be assessed 
for violations of certain provisions of the Exchange Act, where such 
penalties are in the public interest. Tier One civil money penalties 
may be assessed pursuant to 15 U.S.C. 78u-2(b)(1) in an amount not to 
exceed $9,239 for a natural person or $92,383 for any other person for 
violations set forth in 15 U.S.C. 78u-2(a). Tier Two civil money 
penalties may be assessed pursuant to 15 U.S.C. 78u-2(b)(2) in an 
amount not to exceed--for each violation set forth in 15 U.S.C. 78u-
2(a)--$92,383 for a natural person or $461,916 for any other person if 
the act or omission involved fraud, deceit, manipulation, or deliberate 
or reckless disregard of a regulatory requirement. Tier Three civil 
money penalties 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 $184,767 for a natural person or $923,831 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.
    (16) Civil money penalties assessed pursuant to 15 U.S.C. 1639e(k) 
for appraisal independence violations. Pursuant to section 1472(a) of 
the Dodd-Frank Wall Street Reform and Consumer Protection Act 
(Appraisal Independence Rule) (15 U.S.C. 1639e(k)), civil money 
penalties may be assessed for an initial violation of the Appraisal 
Independence Rule in an amount not to exceed $11,279 for each day 
during which the violation continues and, for subsequent violations, 
$22,556 for each day during which the violation continues.
    (17) Civil money penalties assessed for false claims and statements 
pursuant to 31 U.S.C. 3802. Pursuant to the Program Fraud Civil 
Remedies Act (31 U.S.C. 3802), civil money penalties of not more than 
$11,181 per claim or statement may be assessed for violations involving 
false claims and statements.
    (18) Civil money penalties assessed for violations of 42 U.S.C. 
4012a(f). Pursuant to the Flood Disaster Protection Act (FDPA) (42 
U.S.C. 4012a(f)), civil money penalties may be assessed against any 
regulated lending institution that engages in a pattern or practice of 
violations of the FDPA in an amount not to exceed $2,133 per violation.

    Dated at Washington, DC on December 19, 2017.

    By order of the Board of Directors.
Valerie J. Best,
Assistant Executive Secretary.
[FR Doc. 2018-00403 Filed 1-11-18; 8:45 am]
BILLING CODE 6714-01-P