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

28027

Vol. 60, No. 103

Tuesday, May 30, 1995

1The OTS’s authority to govern the custody and

use of its records and the testimony of its personnel

derives from 12 U.S.C. 1462a, 1463(a) 1464 and 5

U.S.C. 301. In particular, section 1462a(b)(2)

authorizes the Director of the OTS to prescribe such

regulations as he may determine to be necessary for

carrying out his responsibilities. Also, section 301

authorizes an agency head to prescribe regulations

governing the conduct of its employees and the

custody, use and preservation of its records.

DEPARTMENT OF THE TREASURY

Office of Thrift Supervision

12 CFR Parts 506, 510

[No. 95–100]

RIN 1550–AA66

Release of Unpublished Information

AGENCY: Office of Thrift Supervision,

Treasury.

ACTION: Final rule.

SUMMARY: The Office of Thrift

Supervision (OTS) is issuing its final

regulation pertaining to the release of

unpublished OTS information. The rule

is based upon the OTS’s experience and

practices developed during the last five

years in responding to the large volume

of requests by the public for

unpublished OTS information.

The final rule describes the

procedures that requesters must follow

in requesting the release of unpublished

information by document or testimony

and the criteria on which the OTS will

evaluate requests for unpublished

information. The records covered

include those created or obtained in

connection with the OTS’s performance

of its statutory responsibilities, such as

supervision, regulation, examination,

and law enforcement duties.

EFFECTIVE DATE: July 1, 1995.

FOR FURTHER INFORMATION CONTACT:

Valerie J. Lithotomos, Counsel (Banking

and Finance), (202) 906–6439,

Regulations and Legislation Division;

Donna Miller, Program Manager, (202)

906–7488, Affiliates Programs; Francis

Raue, Program Analyst, (202) 906–5750,

Thrift Policy; Office of Thrift

Supervision, 1700 G Street NW.,

Washington, DC 20552.

SUPPLEMENTARY INFORMATION:

I. Background

The OTS is today issuing a final rule

amending its current rule concerning

the release of unpublished information.1

The final rule includes requests for

release of records that are exempt from

disclosure under the Freedom of

Information Act (FOIA), such as

examination and related reports,

information relating to the business

operations and finances of individual

savings associations, savings and loan

holding companies, other affiliates, and

their customers, and information

compiled in connection with the OTS’s

enforcement investigations. It also

includes requests for testimony. The

testimony covered in the final rule

includes requests for current and former

OTS employees, officers, and agents

(and for former employees, officers and

agents of the OTS’s predecessor, the

Federal Home Loan Bank Board) to

testify in judicial and administrative

proceedings, including depositions and

informal interviews, about information

obtained in their official OTS capacities.

The final rule in no way affects the

rights and procedures governing access

to records that are required under the

FOIA. Indeed, the final rule does not

apply to requests for records under the

FOIA; FOIA requests remain governed

by Part 505 of the OTS’s regulations and

the Treasury Department’s FOIA

regulations. However, the final rule may

permit the OTS to make records

available that are exempt from

disclosure under the FOIA.

The final rule provides that in

considering requests for disclosure of

unpublished information, the OTS must

weigh carefully the need demonstrated

by a member of the public for access to

the OTS’s records and testimony against

the public interest in maintaining the

confidentiality of the unpublished

information. Among the factors the OTS

will consider in weighing the public

interest in confidentiality is the impact

on the OTS’s supervisory, examination,

and enforcement responsibilities of

releasing such information. The OTS

will balance these and other appropriate

considerations with a requester’s

interest and expressed need in obtaining

such information.

While the vast majority of requests for

unpublished records and testimony

arise in the course of litigation to which

the OTS is not a party, this final rule

also provides for the evaluation of

requests that arise in a non-litigation

context. A non-litigation request must

demonstrate as great a need for release

of the information as that shown by a

request made in the course of litigation.

In addition, the final rule, for the first

time, authorizes savings associations to

release their examination reports and

related supervisory correspondence to

their holding companies, and similarly

authorizes holding companies to release

their examination reports and related

supervisory correspondence to their

subsidiary savings associations. Also,

reports and other information released

under this rule remain the property of

the OTS, regardless of where such

reports or information are physically

located.

The final rule also provides for the

imposition of fees for searches for

records, copying, certifications and

witness fees and allowances.

A. Revisions to Existing Section 510.5

The final rule completely revises

much of existing 12 CFR 510.5. In

particular, the final rule adds detailed

procedures for the public to follow in

requesting release of unpublished OTS

information and describes criteria on

which the OTS will evaluate such

requests. Also, as noted above, the final

rule for the first time authorizes savings

associations to release their examination

reports and related supervisory

correspondence to their parent holding

companies, and similarly authorizes

holding companies to release their

examination reports and related

supervisory correspondence to their

subsidiary savings associations. The

final rule also provides for

reimbursement to the OTS for

producing records and witnesses. A

more detailed description, section by

section, of the revisions made to current

§ 510.5 is contained below in ‘‘B.

Description of the Proposal’’.

B. Description of the Proposal

On December 9, 1993, the OTS

published in the Federal Register a
28028 Federal Register / Vol. 60, No. 103 / Tuesday, May 30, 1995 / Rules and Regulations

2The reader is also directed to the preamble

discussion in the proposal for a more detailed

discussion of the background of this regulation.

notice of proposed rulemaking

describing amendments to its current

§ 510.5. 58 FR 64695 (December 9,

1993).2 The public comment period

closed on February 7, 1994. The

proposal is described section by section

below:

Section 510.5(a): Paragraph (a)

identifies the types of requests covered

under this rule. This paragraph provides

that the rule applies to requests from the

public for unpublished OTS

information; the term ‘‘unpublished

information’’ includes records and

testimony. The covered records include

those created or obtained in connection

with the OTS’s performance of its

responsibilities such as its supervisory,

regulatory, examination, and

enforcement-related duties. The covered

testimony includes that of present and

former employees, officers, and agents

for information obtained in their official

OTS capacities. The paragraph states

that this rule does not apply to records

required to be released under the FOIA,

nor does it apply to requests for

information by other government

agencies or requests for information that

arise in proceedings in which the OTS

is a party.

Section 510.5(b): Paragraph (b) sets

out the purpose of this regulation. The

purpose of this rule is to provide an

orderly mechanism for expeditiously

processing requests for OTS’s

unpublished information while

preserving the OTS’s need to maintain

confidentiality of certain information.

Section 510.5(c): Paragraph (c)

describes the procedures that must be

followed when making a request for

unpublished OTS information.

Paragraph (1) describes general

procedures that apply to all requests by

members of the public for unpublished

information (i.e., records and

testimony). It sets forth the types of

information that must be contained in

such requests, including a showing by

the requester that the information

sought is highly relevant to the purpose

for which it is sought. In addition, the

requester must demonstrate that the

information requested is not available

from another source. The requester must

also demonstrate that the need for such

information clearly outweighs the need

to maintain the confidentiality of OTS

unpublished information and the

burden on the OTS in producing the

information, such as the disruption to

the OTS’s supervisory and other

responsibilities that is occasioned by

reviewing a large volume of records and

loss to the OTS of the services of

employees while they testify at

depositions or hearings. This paragraph

also requires a requester who seeks a

response in less than 30 days to include

an explanation of why the request was

not submitted earlier and why the

expedited handling of the request is

necessary.

Paragraphs (2) and (3) set forth

additional requirements for certain

types of requests. Paragraph (2) pertains

to requests for records. It requires that

requesters of unpublished OTS records

specifically list the types and categories

of records sought and the relevant time

period. Paragraph (3) describes special

requirements for requests for testimony

from OTS employees. This paragraph

states that requests for testimony by

OTS employees or former employees

must specifically describe the substance

of the testimony sought and show a

compelling need for the testimony. Such

requests shall also include a

demonstration that the information

sought is not available from any other

source. This paragraph also prohibits

OTS employees from testifying as expert

witnesses for private parties, requests

that litigants anticipate their need for

OTS testimony in time for such

testimony to be taken in deposition

form, and states that the OTS shall

specify the scope of any authorized

testimony.

Paragraph (4) specifies that

unpublished OTS information made

available to savings associations, state

and Federal agencies and requesters

shall remain the property of the OTS

and shall not be disclosed to any other

party without OTS authorization. In

addition, the paragraph authorizes a

savings association to provide a copy of

its examination report and related

supervisory correspondence to parent

holding companies. Similarly, a savings

and loan holding company is authorized

to provide a copy of its examination

report and related supervisory

correspondence to its subsidiary savings

association(s) without further

authorization from the OTS.

Paragraph (5) provides that requests

for unpublished OTS information shall

be sent to the OTS at 1700 G Street,

NW., Washington, D.C. 20552, to the

attention of the Corporate Secretary.

Section 510.5(d): Paragraph (d)

describes the process by which the OTS

will consider requests for unpublished

information, both records and

testimony, and the factors the OTS may

consider in denying such requests.

Section 510.5(e): Paragraph (e) sets

forth restrictions on the dissemination

of unpublished OTS information.

Paragraph (1) provides that except as

authorized by this regulation or as

otherwise authorized by the Director or

his delegate, no current or former OTS

employee may disclose any

unpublished OTS information to anyone

other than an employee or agent of the

OTS properly entitled to such

information for the performance of their

official duties.

Paragraph (2) requires any person

with unpublished OTS information who

is served with a subpoena, order, or

other process requiring their attendance

as a witness or for production of

records, to advise the issuer of such

notice of the substance of this

regulation. In addition, this paragraph

prohibits any person with unpublished

OTS information from disclosure of

such information in response to a

subpoena without prior OTS

authorization.

Paragraph (3) provides that if a person

is required to appear in response to a

subpoena or other legal process and is

asked to disclose unpublished OTS

information, that person shall decline to

produce such information or give any

testimony concerning such information.

Upon receiving such a request or

subpoena to testify, the individual is

required to contact promptly the OTS

Litigation Division.

Paragraph (4) specifies that the

possession of unpublished OTS

information by savings associations,

their holding companies, and state and

Federal agencies shall not waive any

privilege the OTS might have to such

information.

Section 510.5(f): Paragraph (f)

imposes requirements to protect the

confidentiality of unpublished OTS

information that is made available to

requesters. Paragraph (1) provides that

the release of records will normally be

conditioned upon entry of an acceptable

protective order by the court or

administrative tribunal presiding in a

particular case or, in non-litigated

matters, upon execution of an

acceptable confidentiality agreement.

Paragraph (2) states that the OTS may

condition its authorization of deposition

testimony on an agreement of the parties

that the transcript of the testimony shall

remain confidential. This paragraph also

requires the party who requested the

testimony to furnish the OTS with a

copy of the transcript of the testimony

at its expense.

Section 510.5(g): Paragraph (g) sets

forth procedures designed to limit the

burden on the OTS in connection with

releasing records. Paragraph (1) states

that requesters who require

authenticated records should request

certified copies at least 30 days prior to

the date the records are needed.
Federal Register / Vol. 60, No. 103 / Tuesday, May 30, 1995 / Rules and Regulations 28029

3 5 U.S.C. 552(b)(8).

4 12 U.S.C. 1462a; 5 U.S.C. 301.

Paragraph (2) specifies the

responsibility of litigants to share and

safeguard OTS records. This paragraph

provides that the party to whom records

are released has the responsibility of

notifying the other parties, providing

them with copies of the records,

retrieving any records from the court’s

file when they are no longer required,

and returning such records to the OTS.

Section 510.5(h): Paragraph (h) sets

forth the fees for records searches,

records copying and records

certification. Specifically, it provides

that the fees charged to the requester of

OTS records shall be the fees set forth

in the Treasury Department regulations,

31 CFR 1.7. Paragraph (2) requires that

witness fees and allowances will be

paid by the requester of testimony of

current OTS employees in accordance

with 28 U.S.C. 1821.

II. Summary of Comments

A. General Summary

The OTS received a total of 20 letters

of comment from 4 types of sources.

Those who submitted comments

included 14 savings associations; 5

trade associations; 1 co-operative

savings bank; and 1 holding company

(one thrift submitted its comment letter

on behalf of itself and its parent holding

company).

Generally, several commenters

expressed concern that the proposed

rule would have a ‘‘chilling effect’’ on

the examination process. They asserted

that the possibility that the OTS might

subsequently release information

provided in an examination may

impede the free flow of information

from a savings association to the OTS

examiners. Some commenters expressed

concern that the proposal was an

impermissible expansion of the FOIA

and urged that deviations from the FOIA

requirements be considered cautiously.

Also, five commenters supported the

portion of the proposal permitting

holding companies to release their

examination reports to their thrifts and

thrifts to release examination reports to

their holding companies.

B. Specific Issues Discussion

1. Possible ‘‘Chilling Effect’’ on

Examination Process

Several commenters speculated that

this rule will be detrimental to the

industry in that it will inhibit

cooperation and candid communication

between savings associations and the

OTS examiners. Certain of these

commenters stated that the examination

process and the supervisory process

would be adversely affected by this rule

because institutions may attempt to

protect confidential information which

could reasonably be expected to harm

the institution if disclosed.

The commenters did not point to any

particular situation where such

problems have arisen. In fact, OTS has

been following these practices for

several years, and its experience

indicates that the integrity of the

examination process will not in any way

be compromised by this rule. In

hundreds of instances OTS has

produced non-public information about

institutions in response to demands

made by litigants in law suits in which

OTS is not a party (‘‘third-party

litigation’’). In responding to such

requests, OTS has developed a practice

over a period of five years, which is

incorporated into this regulation, that

balances confidentiality concerns with

the disclosure obligations in the Federal

Rules of Civil Procedure. (Under the

Federal Rules of Civil Procedure, a

litigant is generally entitled to discover

non-privileged relevant information.)

Specifically, in responding to a request

for release of non-public information,

OTS considers the following three

factors: (1) The relevance of the

information, (2) the availability of the

information from other sources and (3)

whether the need for the information

outweighs the need to keep it

confidential and the burden on OTS.

These criteria are set forth in the

regulation issued today. Sec. 510.5(c)(1).

Further, in keeping with existing

practice, the regulation provides that if

OTS grants a request for disclosure of

non-public information, it will generally

condition the release of the information

on the entry of a confidentiality order or

agreement that places limits on the

extent to which the recipient may

disclose the information. Sec. 510.5(f).

By selectively releasing information

in third-party litigation only when these

criteria are met, and by requiring that a

confidentiality order or agreement be in

place before non-public information is

released, OTS has minimized any

potential adverse consequence

occasioned by the release of the

information. As noted, following these

procedures, OTS has disclosed nonpublic information in hundreds of cases

in which it has received production

demands under the Federal Rules of

Civil Procedure, and it is not aware that

this practice has had any adverse effect

on the examination process.

2. Freedom of Information Act

Considerations

Six commenters expressed concern

that the FOIA specifically exempts from

disclosure certain records, such as

OTS’s examination reports, and that the

release of such records would be a

‘‘violation’’ of the FOIA. First, the FOIA

does not prohibit the release of

information; rather, it requires the

disclosure of certain types of records

and exempts from mandatory release

other records. The FOIA gives the

agency discretion to release information

that it is not otherwise required to

release under FOIA. Among the

categories of records that are exempt

from mandatory release are records

related to examination, operating or

condition reports prepared by, on behalf

of, or for the use of an agency

responsible for the regulation or

supervision of financial institutions.3

Thus, while the FOIA exempts these

records from the mandatory disclosure

requirements, it in no manner prevents

the OTS from disclosing this

information under the OTS’s authority

to govern the custody and the use of its

records and the testimony of its

personnel.4 The OTS will continue to

exercise its authority to release such

information in a prudent manner by

applying the procedures set forth in the

final rule and the relevant federal case

law.

3. An Interagency Process Should be

Established

The recommendation was made by

some commenters that the OTS should

work with the other banking agencies to

establish interagency procedures to

provide for consistent application of

criteria governing release of

unpublished information concerning

financial institutions. One commenter

stated that this is a matter for resolution

under the auspices of the Federal

Financial Institutions Examination

Council (FFIEC), and recommended that

the OTS refer the issues arising out of

the proposal to the FFIEC.

The nature of requests, the volume of

requests and the needs of the agency

may vary from one federal agency to

another. While the OTS agrees with the

merits of developing a uniform set of

procedures for responding to requests

for unpublished information, the public

interest would not be served by delaying

the issuance of this rule while the

prospect of developing uniform

procedures on an interagency basis is

explored. Because the existing rule does

not describe many of the practices that

OTS has developed over the last several

years, it is preferable to amend the rule

now so that the public is informed of

the disclosure process OTS currently

uses.
28030 Federal Register / Vol. 60, No. 103 / Tuesday, May 30, 1995 / Rules and Regulations

5 58 FR 64695 (December 9, 1993).

4. Violation of the Right to Privacy

Three commenters asserted that the

release of confidential information

without the knowledge and consent of

the savings association violates a

general right to privacy of the thrift, its

customers, and its personnel. The

commenters identified no statutory

basis for this assertion. In releasing

unpublished OTS information, the OTS

has observed and will continue to

observe the requirements of the Privacy

Act of 1974, 5 U.S.C. 552a, and the

Right to Financial Privacy Act, 12 U.S.C.

3401 et seq.

5. Source of Information Should be

Permitted to Comment

Three commenters suggested that the

source or subject of the confidential

information should be permitted to

express its views regarding the release

of unpublished information. The OTS

has on occasion contacted the source of

the information for its views on release

of the information. However, in the vast

majority of cases, the OTS has been able

to evaluate the necessity to maintain the

confidentiality of OTS information

without consulting the subject or source

of the OTS information. Therefore, a

requirement that the OTS obtain the

subject’s or source’s views in all

instances would result in unnecessary

delays in processing requests. For this

reason, the OTS declines to include a

provision requiring that the source’s

views be sought, but the OTS will

retain, on a case-by-case basis, the

practice of contacting the source of

information for input when the

circumstances and timing warrant.

6. Information Shared With Holding

Company

Five commenters supported the new

provision authorizing a savings

association to provide a copy of its

examination report and related

supervisory correspondence to its

parent holding company. The

commenters also supported the

provision whereby the holding company

would similarly be authorized to

provide a copy of its examination report

and related supervisory correspondence

to its subsidiary thrift. This information

would enhance the ability of a holding

company to assess its subsidiary thrift’s

operations and compliance with

regulatory standards, and would permit

the holding company to provide

managerial or financial resources when

needed. Similarly, a subsidiary thrift

could use this information to address

issues it may have with the holding

company and to avoid potential

conflicts of interest.

7. Increased Litigation and Increased

Costs

Three commenters expressed concern

that the final rule will lead to an

increase in shareholder and other

lawsuits against savings associations.

Also, two commenters expressed

concern that this rule would greatly

increase the amount of OTS employee

time and taxpayer money that would be

expended in evaluating requests for

information, as well as increase costs

generally. The OTS does not agree with

these concerns. The final rule simply

codifies the OTS’s existing practices in

evaluating requests from the public for

unpublished OTS information. The

OTS’s experience over the past five

years has not shown that these practices

resulted in increased litigation against

savings associations or increased costs

to the OTS. In fact, the final rule should

help reduce costs by decreasing the

amount of time that OTS personnel

devote to answering questions from the

public about the OTS’s procedures for

releasing non-public information.

Unlike the current rule, the final rule

specifies in detail the procedures that

must be followed and the information

that must be provided when the public

requests unpublished OTS information.

III. Description of the Final Rule

The final rule does not differ

materially from the proposal. Certain

non-substantive changes have been

made to section 510.5(a)(2) for

clarification purposes. Section

510.5(a)(3) was changed to clarify that

this rule does not apply to other

government agencies except where

specifically provided. Also, section

510.5(c)(4)(v) was changed to clarify

that requesters who obtain unpublished

OTS information may not disclose such

information without the OTS’s

authorization.

Certain minor changes have been

made to section 510.5(c)(2)(ii) in

response to a comment that was

submitted. As proposed, that subsection

provided that if a party to a lawsuit has

a claim of privilege regarding the

information in OTS records and the

records are in the possession of that

party, the OTS may respond to the

request by authorizing the party to

release the records pursuant to an

appropriate confidentiality order rather

than by releasing the records directly to

the requesting party, so that the party

possessing the records may argue the

issue of privilege in the appropriate

court. In the final rule, the term

‘‘another party to the lawsuit’’ has been

changed to ‘‘person’’ in order to clarify

that a person (e.g., an individual,

corporation, partnership) may assert a

privilege for non-public OTS records in

its possession or control if it receives a

subpoena for such information in

litigation in which it is not a party. The

final rule also clarifies that the privilege

may be asserted by the person who has

either possession or control of the

records, rather than just possession of

the records.

Section 510.5(c)(5) was also changed

to specify that requests submitted under

this regulation should be sent to the

attention of the Corporate Secretary.

Section 510.5(d)(4), which describes

the grounds for denying requests, was

modified to include two criteria that are

identified in section 510.5(c), the

section that explains the issues that

must be addressed in a request for

unpublished OTS information. The

additional criteria for denying a request

are (1) the need for the information does

not clearly outweigh the need to

maintain the confidentiality of the

information, and (2) the requester has

not shown a compelling need for the

testimony. While these criteria are

implicit in the grounds for denial that

appeared in the proposed rule and that

have been retained in the final rule (i.e.,

that OTS may deny requests that are

overly burdensome or contrary to the

public interest), OTS is explicitly

including these criteria in the interests

of completeness.

Readers are referred to the preamble 5

in the proposal for additional discussion

of provisions that have not been revised

in the final rule.

IV. Paperwork Reduction Act

The reporting requirements contained

in this final rule have been submitted

for review and approved by the Office

of Management and Budget, in

accordance with the Paperwork

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

3504(h)) under control number 1550–

0081. Comments on the collection of

information should be sent to the Office

of Management and Budget, Paperwork

Reduction Project (1550), Washington,

D.C. 20503, with copies to the Office of

Thrift Supervision, 1700 G Street, NW.,

Washington, D.C. 20552.

The reporting requirements in this

final rule are found in 12 CFR 510.5(c)–

(g). The information is needed by the

OTS to provide a more efficient

mechanism for expeditiously processing

requests for unpublished information.

V. Regulatory Flexibility Act

Pursuant to section 605(b) of the

Regulatory Flexibility Act (Pub. L. 96–

354, 5 U.S.C. 601), it is certified that this
Federal Register / Vol. 60, No. 103 / Tuesday, May 30, 1995 / Rules and Regulations 28031

regulation will not have a significant

economic impact on a substantial

number of small savings associations,

small service corporations, or other

small entities. This regulation simply

sets forth the procedures utilized by the

OTS in its handling of requests for

unpublished OTS information and

imposes fees in connection with such

requests. Accordingly, a regulatory

flexibility analysis is not required.

VI. Executive Order 12866

The OTS has determined that this

regulation does not constitute a

‘‘significant regulatory action’’ for

purposes of Executive Order 12866.

List of Subjects

12 CFR Part 506

Reporting and recordkeeping

requirements.

12 CFR Part 510

Administrative practice and

procedure.

Accordingly, the Office of Thrift

Supervision hereby amends parts 506

and 510, subchapter A, chapter V, title

12 of the Code of Federal Regulations as

set forth below.

SUBCHAPTER A—ORGANIZATION AND

PROCEDURES

PART 506—INFORMATION

COLLECTION REQUIREMENTS UNDER

THE PAPERWORK REDUCTION ACT

1. The authority citation for part 506

continues to read as follows:

Authority: 44 U.S.C. 3501 et seq.

2. Section 506.1 is amended by

adding in numerical order one new

entry to the table in paragraph (b) to

read as follows:

§ 506.1 OMB control numbers assigned

pursuant to the Paperwork Reduction Act.

* * * * *

(b) Display.

12 CFR part or section where

identified and described

Current

OMB control No.

* * * * *

510.5(c) through (g) .................. 1550–0081

* * * * *

PART 510—MISCELLANEOUS

ORGANIZATIONAL REGULATIONS

3. The authority citation for part 510

is revised to read as follows:

Authority: 5 U.S.C. 301; 12 U.S.C. 1462a,

1463, 1464.

4. Section 510.5 is revised to read as

follows:

§ 510.5 Release of unpublished OTS

information.

(a) Scope. (1) This section applies to

requests by the public for unpublished

OTS information, such as requests for

records or testimony from parties to

lawsuits in which the OTS is not a

party.

(2) Unpublished OTS information

includes records created or obtained in

connection with the OTS’s performance

of its responsibilities, such as records

concerning supervision, regulation, and

examination of savings associations,

their holding companies, and affiliates,

and records compiled in connection

with the OTS’s enforcement

responsibilities. Unpublished OTS

information also includes information

that current and former employees,

officers, and agents obtained in their

official capacities. Examples of

unpublished information include:

(i) Information in the memory of a

current or former employee, officer, or

agent of the OTS (or the Federal Home

Loan Bank Board, the predecessor

agency of the OTS), by testimony or

informal interview, that was acquired in

the course of performing official duties

or because of the employee’s, officer’s or

agent’s official status;

(ii) Reports of examination,

supervisory correspondence, internal

agency memoranda and investigatory

files compiled in connection with an

investigation, whether such records are

in the possession of the OTS or some

other individual or entity; and

(iii) Unpublished OTS records

obtained by or in the possession of third

parties, including other government

agencies.

(3) This section does not apply to:

(i) Requests for records or testimony

in proceedings in which the OTS is a

party;

(ii) Requests for information by other

government agencies, except when

specifically provided; and

(iii) Requests for records that are

required to be disclosed under the

Freedom of Information Act, see 5

U.S.C. 552, and 31 CFR 1.1–1.6.

(b) Purpose. The purposes of this

section are:

(1) To afford an orderly mechanism

for the OTS to expeditiously process

requests for unpublished OTS

information and, where appropriate, for

the OTS to assert evidentiary privileges

in litigation;

(2) To balance the need for

confidentiality of unpublished OTS

information with the private party’s

interest in obtaining disclosure of that

information;

(3) To ensure that the time of OTS

employees is utilized in the most

efficient manner consistent with the

OTS’s statutory mission;

(4) To prevent undue burdens on the

OTS;

(5) To limit the expenditure of the

OTS’s funds for private purposes; and

(6) To maintain the impartiality of the

OTS among private litigants.

(c) Procedure.—(1) Requests for

records and testimony in general. A

request for unpublished OTS

information must be in writing, furnish

the caption of the lawsuit if the request

arises in the course of litigation, and

support the requester’s claim that the

information sought is highly relevant to

the purpose for which it is sought. In

demonstrating that the information is

highly relevant, the requester must

explain in detail how the requested OTS

information relates to the issues in the

case or the matter.

(i) For requests arising in lawsuits, the

submission also must include:

(A) A copy of the complaint or

equivalent document in the case and

any other pleadings necessary to show

relevance;

(B) A description of any prior

decisions or pending motions in the

case that may bear on the asserted

relevance of the information being

sought from the OTS; and

(C) The names, addresses and phone

numbers of counsel to all other parties

in the case.

(ii) In all instances, in addition to

demonstrating that the information

sought is highly relevant to the purpose

for which it is sought, the requester

must:

(A) Demonstrate that the information

sought is not available from any other

source; and

(B) Demonstrate that the need for the

information clearly outweighs the need

to maintain the confidentiality of the

OTS information and the burden on the

OTS to produce the information.

(iii) If a request seeks a response in

fewer than 30 days, it must include an

explanation of why the requester was

unable to submit the request earlier and

why expediting the request is required.

(2) Additional provisions relating to

requests for records. In addition to the

requirements of paragraph (c)(1) of this

section, the provisions in paragraphs

(c)(2)(i) and (c)(2)(ii) of this section

apply to requests for disclosure of

records.

(i) A request for records must list the

categories of records sought and

describe the specific information

sought, including the relevant time

period.

(ii) When the OTS believes that

another person has a claim of privilege

regarding the information in the records
28032 Federal Register / Vol. 60, No. 103 / Tuesday, May 30, 1995 / Rules and Regulations

and the records are in the possession or

control of that person, such as reports

prepared by a savings association’s

attorneys that are shared with the OTS,

the OTS may respond to the request by

authorizing that person to release the

records pursuant to an appropriate

confidentiality order rather than by the

OTS releasing the records directly to the

requesting party. This will enable the

person possessing or controlling the

records to argue any issues of privilege

to the appropriate court.

(3) Additional provisions relating to

requests for testimony from OTS

employees. In addition to the

requirements of paragraph (c)(1) of this

section, the provisions in paragraphs

(c)(3)(i) through (c)(3)(iv) of this section

apply to requests that current or former

OTS employees be authorized to give

testimony.

(i) The request must specifically

describe the substance of the testimony

sought and show a compelling need for

the testimony. A showing of compelling

need should include a demonstration

that the requested information is not

available from any other source, such as

the books and records of other persons

or entities, OTS records that have been

or might be released, or the testimony of

other non-OTS persons, including

retained experts.

(ii) OTS employees will not be

authorized to provide expert or opinion

testimony for private parties.

(iii) The OTS expects litigants to

anticipate their need for OTS testimony

in sufficient time to request and obtain

that testimony in deposition form. A

request for testimony at a trial or

hearing may not be granted unless the

requester shows that properly

developed deposition testimony could

not be used or would not be adequate

at the trial or hearing.

(iv) The OTS shall specify the scope

of any authorized testimony and may

take steps to ensure that the scope of

testimony taken adheres to the scope

authorized. Parties to the case who did

not join in the request and who wish to

question the witness beyond the

authorized scope should request

expanded authorization pursuant to this

regulation. The OTS will attempt to

render decisions on such requests in an

expedited manner.

(4) Information available to savings

associations, holding companies, state

and Federal agencies and requesters. (i)

The regular report of examination of a

savings association, savings and loan

holding company, or other affiliate of a

savings association is made available by

the appropriate Regional Office to the

entity examined.

(ii) A subsidiary savings association of

a savings and loan holding company

may reproduce and furnish a copy of its

report of examination and related

supervisory correspondence of the

savings association to its parent holding

company(ies) without prior approval of

the OTS. A savings and loan holding

company may reproduce and furnish a

copy of its report of examination and

related supervisory correspondence to

another affiliated savings and loan

holding company that controls the same

savings association or its subsidiary

savings association(s) without prior

approval of the OTS. This paragraph

does not require such disclosure by a

parent savings and loan holding

company or subsidiary savings

association.

(iii) Reports of examination and other

information relating to state-chartered

savings associations and affiliates are

made available, upon request, by the

OTS to the state governmental authority

having general supervision of such

state-chartered savings associations.

(iv) Reports of examination and other

information may be made available by

the OTS to other agencies of the United

States, a state agency, or to the Federal

Home Loan Banks, for use where

necessary in the performance of their

official duties.

(v) All reports or other information

made available to savings associations,

holding companies, affiliates, other

governmental agencies or requesters

shall remain the property of the OTS

and, except as permitted by this section

or otherwise by the Director or his

delegate, no person, company, agency,

or authority to whom the information is

made available, or any officer, director,

employee or agent thereof, shall disclose

any such information except published

statistical material that would not

disclose the identity of any individual

or corporation.

(5) Where to submit requests. In all

matters covered by this section,

notification of the issuance of

subpoenas or compulsory process and

requests for records or testimony

covered by this section must be sent to

the OTS at 1700 G Street NW.,

Washington, DC 20552, to the attention

of the Corporate Secretary, and should

be labelled ‘‘Request for Release of

Unpublished Information Under Section

510.5.’’ Requesters may furnish copies

of the request or subpoenas

simultaneously to the appropriate OTS

Regional Office, but the furnishing of

such copies does not constitute service

on the OTS.

(d) Consideration of requests—(1) In

general. The OTS will generally process

requests in the order in which they are

received. The OTS will endeavor to

respond to requests within 30 days, but

this may vary depending on the scope

and precision of the request. The OTS

will weigh requests for processing in

less than 30 days against the burden to

the OTS of expedited processing and the

unfairness to other parties whose

pending requests may be delayed.

(2) Consultation with requester. The

OTS may consult with the requester to:

(i) Refine and limit the scope of the

request so as to reduce the burden and

expense on the OTS; or

(ii) Obtain additional information

necessary for the OTS to make an

informed determination on the request.

To the extent necessary to reach an

informed determination on the request,

the OTS may inquire into the

circumstances of the underlying matter

and rely on sources of information

beyond the requester, including other

interested parties.

(3) Final determinations. Final

determinations on requests will be made

by the Director or his delegate. All such

determinations are the sole discretion of

the Director or his delegate. Requesters

will be notified in writing of the

disposition of the request.

(4) Denial of requests. (i) The OTS

may deny requests for records or

testimony that seek information that the

OTS deems to be:

(A) Not highly relevant;

(B) Privileged;

(C) Available from other sources; or

(D) Information that should not be

disclosed for reasons that warrant

restriction of discovery under the

Federal Rules of Civil Procedure (28

U.S.C. appendix).

(ii) The OTS may also deny a records

or testimony request when it considers

production of the information to be

overly burdensome or contrary to the

public interest, or where OTS

determines that the need for the

information does not clearly outweigh

the need to maintain the confidentiality

of the information, or where the

requester seeks testimony and has not

shown a compelling need for the

testimony.

(5) Confidentiality Orders and

Agreements. As is set forth in paragraph

(f) of this section, the OTS may

condition release of information on the

entry by the relevant tribunal of an

order satisfactory to the OTS or, in a

non-litigated matter, the execution of a

confidentiality agreement that limits

access of third parties to the

unpublished OTS information. It shall

be the duty of the requesting party to

obtain such an order or to execute a

confidentiality agreement.
Federal Register / Vol. 60, No. 103 / Tuesday, May 30, 1995 / Rules and Regulations 28033

(e) Parties with access to OTS

information; restriction on

dissemination—(1) Current and former

employees. Except as authorized by this

section or as otherwise authorized by

the Director or his delegate, no current

or former employee, officer or agent of

the OTS or a predecessor agency shall

disclose or permit the disclosure of any

unpublished information of the OTS to

anyone (other than an employee, officer

or agent of the OTS properly entitled to

such information for the performance of

their official duties), whether by giving

out or furnishing such information or a

copy thereof or by allowing any person

to inspect, examine, or copy such

information or copy thereof, or

otherwise.

(2) Duty of person served. If any

person, whether or not a current or

former employee, officer or agent of the

OTS, has information of the OTS that

may not be disclosed under the

regulations of the OTS or other

applicable law, and in connection

therewith is served with a subpoena,

order, or other process requiring

personal attendance as a witness or

production of records or information in

any proceeding, that person shall

promptly advise the OTS of such service

or request for information. Upon such

notice the OTS will take appropriate

action to advise the court or tribunal

that issued the process and the attorney

for the party at whose instance the

process was issued, if known, of the

substance of this section. Such notice to

the OTS shall be made by contacting the

Litigation Division, Office of Chief

Counsel, Office of Thrift Supervision,

1700 G Street NW., Washington, DC

20552. As provided in paragraph (e)(3)

of this section, a person so served with

process may not disclose OTS

information without OTS authorization.

To obtain OTS authorization, a request

must be sent to the OTS in Washington,

DC, in accordance with paragraph (c) of

this section.

(3) Appearance by person served.

Except as the OTS has authorized

disclosure of the relevant information,

or except as authorized by law, any

person who has information of the OTS

that may not be disclosed under this

section and is required to respond to a

subpoena or other legal process shall

attend at the time and place therein

mentioned and respectfully decline to

produce such records or give any

testimony with respect thereto, basing

such refusal on this part. If,

notwithstanding, the court or other body

orders the disclosure of such records or

the giving of such testimony, the person

having such information of the OTS

shall continue respectfully to decline to

produce such information and shall

promptly advise the Litigation Division

of the Chief Counsel’s Office, Office of

Thrift Supervision. Upon such notice

the OTS will take appropriate action to

advise the court or tribunal which

issued the order, of the substance of this

section.

(4) Non-waiver of privilege. The

possession by any entity or individual

described in paragraph (c)(4) of this

section of OTS records covered by this

section shall not waive any privilege of

the OTS or the OTS’s right to supervise

the further dissemination of these

records.

(f) Orders and agreements protecting

the confidentiality of unpublished OTS

information—(1) Records. Unless

otherwise permitted by the OTS, release

of records authorized pursuant to this

section will be conditioned by the OTS

upon entry of an acceptable protective

order by the court or administrative

tribunal presiding in the particular case,

or, in non-litigated matters, upon

execution of an acceptable

confidentiality agreement. In cases

where protective orders have already

been entered, the OTS reserves the right

to condition approval for release of

information upon the inclusion of

additional or amended provisions.

(2) Testimony. The OTS may

condition its authorization of deposition

testimony on an agreement of the parties

that the transcript of the testimony will

be kept under seal, or will be made

available only to the parties, the court

and the jury, except to the extent that

the OTS may allow use of the transcript

in related litigation. The party who

requested the testimony shall, at its

expense, furnish to the OTS a copy of

the transcript of testimony of the OTS

employee or former employee.

(g) Limitation of burden on the OTS

in connection with released records—(1)

Authentication for use as evidence. The

OTS will authenticate released records

to facilitate their use as evidence.

Requesters who require authenticated

records should request certified copies

at least 30 days prior to the date they

will be needed. The request should be

sent to the OTS Public Disclosure

Branch and shall identify the records,

giving the office or record depository

where they are located (if known) and

include copies of the records and

payment of the certification fee.

(2) Responsibility of litigants to share

released records. The party who has

sought and obtained OTS records has

the responsibility of:

(i) Notifying other parties to the case

of the release and, after entry of a

protective order, providing copies of the

records to the other parties who are

subject to the protective order; and

(ii) Retrieving any records from the

court’s file as soon as the records are no

longer required by the court and

returning them to the OTS. Where a

party may be involved in related

litigation, the OTS may, upon a request

made to it pursuant to this section,

authorize such party to transfer the

records for use in that related case.

(h) Fees—(1) Fees for records

searches, copying and certifications.

Requesters shall be charged fees in

accordance with Treasury Department

regulations, 31 CFR 1.7. With certain

exceptions, the regulations in 31 CFR

1.7 provide for recovery of the full

direct costs of searching, reviewing,

certifying and duplicating the records

sought. An estimate of the statement of

charges will be sent to requesters, and

fees shall be remitted by check payable

to the OTS prior to release of the

requested records. Where it deems

appropriate, the OTS may contract with

commercial copying concerns to copy

the records, with the cost billed to the

requester.

(2) Witness fees and allowances. (i)

Litigants whose requests for testimony

of current OTS employees are approved

shall, upon completion of the

testimonial appearance, promptly

tender a check payable to the OTS for

witness fees and allowances in

accordance with 28 U.S.C. 1821.

(ii) All litigants whose requests for

testimony of former OTS employees are

approved, shall also promptly tender

witness fees and allowances to the

witness in accordance with 28 U.S.C.

1821.

Dated: May 22, 1995.

By the Office of Thrift Supervision.

Jonathan L. Fiechter,

Acting Director.

[FR Doc. 95–12967 Filed 5–26–95; 8:45 am]

BILLING CODE 6720–01–P

12 CFR Part 509

[No. 95–102]

RIN 1550–AA80

Rules of Practice and Procedure in

Adjudicatory Proceedings

AGENCY: Office of Thrift Supervision,

Treasury.

ACTION: Final rule.

SUMMARY: The Office of Thrift

Supervision (OTS) is amending its Rules