Federal Register / Vol. 65, No. 77 / Thursday, April 20, 2000 / Proposed Rules 21165

decision for purposes of revising that

decision.

(d) New and material evidence, as that

phrase is used in this part, means

evidence which was unavailable to the

agency at the time the decision was

made, and which the claimant could not

reasonably have been expected to have

submitted at that time.

§ 349.2 Conditions for reopening.

A final decision may be reopened:

(a) Within 12 months of the date of

the notice of such decision, for any

reason;

(b) Within four years of the date of the

notice of such decision:

(1) If there is new and material

evidence; or

(2) If the decision was not reasonably

consistent with the evidence of record at

the time of adjudication.

(c) At any time if:

(1) The decision was obtained by

fraud or similar fault;

(2) The decision was that the claimant

was not a qualified employee, and he or

she is now qualified because

compensation was credited to the

employee’s record of compensation in

accordance with part 211 of this

chapter:

(i) To correct errors apparent on the

face of the compensation record;

(ii) To enter items transferred by the

Social Security Administration which

were credited under the Social Security

Act when they should have been

credited to the employee’s railroad

retirement compensation record; or

(iii) To correct errors made in the

allocation of earnings to individuals or

periods which would have made him or

her a qualified employee at the time of

the decision if the earnings had been

credited to his or her earnings record at

that time;

(3) The decision is wholly or partially

unfavorable to a claimant, but only to

correct a clerical error or an error that

appears on the face of the evidence that

was considered when the decision was

made.

§ 349.3 Change of legal interpretation or

administrative ruling.

A change of legal interpretation or

administrative ruling upon which a

decision is based does not render a

decision erroneous and does not

provide a basis for reopening.

§ 349.4 Late completion of timely

investigation.

(a) A decision may be revised after the

applicable time period in §§ 349.2(a) or

(b) expires if the Board begins an

investigation into whether to revise the

decision before the applicable time

period expires and the agency diligently

pursues the investigation to the

conclusion. The investigation may be

based on a request by a claimant or on

action by the Board.

(b) Diligently pursued for purposes of

this section means that in view of the

facts and circumstances of a particular

case, the necessary action was

undertaken and carried out as promptly

as the circumstances permitted. Diligent

pursuit will be presumed to have been

met if the investigation is concluded

and, if necessary, the decision is revised

within six months from the date the

investigation began.

(c) If the investigation is not diligently

pursued to its conclusion, the decision

will be revised if a revision is applicable

and if it is favorable to the claimant. It

will not be revised if it would be

unfavorable to the claimant.

§ 349.5 Notice of revised decision.

(a) When a decision is revised, notice

of the revision will be mailed to the

parties to the decision at their last

known address. The notice will state the

basis for the revised decision and the

effect of the revision. The notice will

also inform the parties of the right to

further review.

(b) If a hearings officer or the threemember Board proposes to revise a

decision, and the revision would be

based only on evidence included in the

record on which the prior decision was

based, all parties will be notified in

writing of the proposed action. If a

revised decision is issued by a hearings

officer, any party may request that it be

reviewed by the three-member Board, or

the three-member Board may review the

decision on its own initiative.

§ 349.6 Effect of revised decision.

A revised decision is binding unless:

(a) The revised decision is being

reconsidered or appealed in accord with

part 320 of this chapter;

(b) The three-member Board reviews

the revised decision; or

(c) The revised decision is further

revised consistent with this part.

§ 349.7 Time and place to request a review

and/or hearing on revised decision.

A party to a revised decision may

request, as appropriate, further review

of the decision in accordance with the

rules set forth in part 320 of this

chapter. Further review or a hearing will

be held according to the rules set forth

in part 320 of this chapter.

§ 349.8 Discretion of the three-member

Board to reopen or not to reopen a final

decision.

In any case in which the threemember Board may deem proper, the

Board may direct that any decision,

which is otherwise subject to reopening

under this part, shall not be reopened or

direct that any decision, which is

otherwise not subject to reopening

under this part, shall be reopened.

Dated: April 11, 2000.

By Authority of the Board.

For the Board,

Beatrice Ezerski,

Secretary to the Board.

[FR Doc. 00–9860 Filed 4–19–00; 8:45 am]

BILLING CODE 7905–01–P

DEPARTMENT OF THE TREASURY

31 CFR Part 1

Internal Revenue Service; Privacy Act

of 1974, Proposed Implementation

AGENCY: Office of the Secretary,

Treasury.

ACTION: Proposed rule.

SUMMARY: In accordance with the

requirements of the Privacy Act of 1974,

as amended, 5 U.S.C. 552a, the Treasury

Department, Internal Revenue Service,

gives notice of a proposed amendment

to exempt the system of records entitled

‘‘Criminal Investigation Audit Trail

Records System—Treasury/IRS 46.051’’

from certain provisions of the Privacy

Act. The exemption is intended to

comply with legal prohibitions against

the disclosure of certain kinds of

information and to protect certain

information on individuals maintained

in this system of records.

DATES: Comments must be received no

later than May 22, 2000.

ADDRESSES: Comments should be sent to

the Office of Governmental Liaison and

Disclosure, Internal Revenue Service,

1111 Constitution Avenue, NW,

Washington, DC 20224. Comments will

be made available for inspection and

copying in the Freedom of Information

Reading Room upon request.

FOR FURTHER INFORMATION CONTACT: FuAn Chao, Chief, Systems Development

and Support, Criminal Investigation,

(202) 622–7803.

SUPPLEMENTARY INFORMATION: The

Internal Revenue Service’s Criminal

Investigation Division seeks to establish

and maintain the proposed new system

of records as a more comprehensive

means of performing its responsibilities.

Criminal Investigation carries out

many law enforcement related

functions. Among Criminal

Investigation’s principal responsibilities

are investigating and referring for

prosecution criminal cases, centering

largely on violations of tax laws,

21166 Federal Register / Vol. 65, No. 77 / Thursday, April 20, 2000 / Proposed Rules

including income tax evasion, refund

fraud, and other crimes contributing to

the federal tax gap. Criminal

Investigation also investigates violations

of certain money laundering laws.

Many of these law enforcement

related functions have been automated

and are available on Criminal

Investigation computer systems. To

ensure the integrity of the system data,

audit records are maintained to identify

all events that occur while users access

or attempt to access the computer

system.

The returns and returns information

contained within this system constitute

investigatory material compiled for law

enforcement purposes under Title 26 of

the United States Code.

Pursuant to the Privacy Act of 1974,

the Department of the Treasury is

publishing separately the notice of a

new system of records, to be maintained

by the Internal Revenue Service.

Under 5 U.S.C. 552a(j)(2) and (k)(2),

the head of an agency may promulgate

rules to exempt any system of records

within the agency from certain

provisions of the Privacy Act of 1974 if

the system contains investigatory

material compiled for law enforcement

purposes. The Criminal Investigation

Audit Trail Records System—Treasury/

IRS 46.051 contains information relating

to investigatory material compiled for

law enforcement purposes pursuant to

26 U.S.C. 7213, 7213A and 18 U.S.C.

1030(a)(2)(B). Such investigatory

material includes: identities of

individuals under investigation,

identities of potential witnesses, and

identities of investigating agents.

The exemptions under 5 U.S.C.

552a(j)(2) and (k)(2), relating to

investigatory material are hereby

claimed for this system. The Department

of the Treasury is hereby giving notice

of a proposed rule to exempt this system

of records described above from certain

provisions of the Privacy Act pursuant

to 5 U.S.C. 552a(j)(2) and (k)(2) and

authority of 31 CFR 1.23(c). The reasons

for exempting this system of records

from certain provisions of 5 U.S.C. 552a

are set forth below:

(1) 5 U.S.C. 552a(c)(3). This provision

of the Privacy Act provides for the

release of the disclosure accounting

required by 5 U.S.C. 552a(c)(1) and (2)

to the individual named in the record at

the individual’s request. The reasons for

exempting the system of records from

the foregoing provision are as follows:

(i) The release of disclosure

accounting would put the subject of an

investigation on notice of the existence

of an investigation and that such person

is the subject of that investigation;

(ii) Such release of the disclosure

accounting would provide the subject of

an investigation with an accurate

accounting of the date, nature, name

and address of the person or agency to

whom the disclosure was made. The

release of such information to the

subject of an investigation would

provide the subject with significant

information concerning the nature of the

investigation and could result in the

altering or destruction of documentary

evidence, the improper influencing of

witnesses, and other activities that

could impede or compromise the

investigation.

(iii) Release to the individual of the

disclosure accounting would alert the

individual as to which agencies were

investigating this person and the scope

of the investigation, and could aid the

individual in impeding or

compromising investigations by those

agencies.

(2) 5 U.S.C. 552a(c)(4), (d)(1), (2), (3),

and (4), (e)(4)(G) and (H), (f) and (g).

These provisions of the Privacy Act

relate to an individual’s right to

notification of the existence of records

pertaining to such individual;

requirements for identifying an

individual who requests access to

records; the agency procedures relating

to access to records and the contents of

the information contained in such

records; and the civil remedies available

to the individual in the event of adverse

determinations by an agency concerning

access to or amendment of information

contained in record systems. The

reasons for exempting the system of

records from the foregoing provisions

are as follows: To notify an individual

at the individual’s request of the

existence of records in an investigative

file pertaining to such individual or to

grant access to an investigative file

could interfere with investigative and

enforcement proceedings; deprive codefendants of a right to a fair trial or an

impartial adjudication; constitute an

unwarranted invasion of the personal

privacy of others; disclose the identity

of confidential sources and reveal

confidential information supplied by

such sources; and disclose investigative

techniques and procedures.

(3) 5 U.S.C. 552a(e)(4)(I). This

provision of the Privacy Act requires the

publication of the categories of sources

of records in each system of records. In

cases where an exemption from this

provision has been claimed, the reasons

are as follows:

(i) Revealing categories of sources of

information could disclose investigative

techniques and procedures;

(ii) Revealing categories of sources of

information could cause sources who

supply information to investigators to

refrain from giving such information

because of fear of reprisal, or fear of

breach of promises of anonymity and

confidentiality.

(4) 5 U.S.C. 552a(e)(1). This provision

of the Privacy Act requires each agency

to maintain in its records only such

information about an individual as is

relevant and necessary to accomplish a

purpose of the agency required to be

accomplished by statute or executive

order. The reasons for exempting the

system of records from the foregoing

provision are as follows:

(i) The Internal Revenue Service will

limit its inquiries to information which

is necessary for the enforcement and

administration of tax laws. However, an

exemption from the foregoing provision

is needed because, particularly in the

early stages of an investigation, it is not

possible to determine the relevance or

necessity of specific information.

(ii) Relevance and necessity are

questions of judgment and timing. What

appear relevant and necessary when

collected may subsequently be

determined to be irrelevant or

unnecessary. It is only after the

information is evaluated that the

relevance or necessity of such

information can be established with

certainty.

(iii) When information is received by

the Internal Revenue Service relating to

violations of law within the jurisdiction

of other agencies, the Internal Revenue

Service processes this information

through Internal Revenue Service

systems in order to forward the material

to the appropriate agencies.

(5) 5 U.S.C. 552a(e)(2). This provision

of the Privacy Act requires an agency to

collect information to the greatest extent

practicable directly from the subject

individual when the information may

result in an adverse determination about

an individual’s rights, benefits, and

privileges under federal programs. The

reasons for exempting the system of

records from the foregoing provision are

as follows:

(i) In certain instances the subject of

a criminal investigation cannot be

required to supply information to

investigators. In those instances,

information relating to a subject’s

criminal activities must be obtained

from other sources;

(ii) In a criminal investigation it is

necessary to obtain evidence from a

variety of sources, other than the subject

of the investigation, in order to

accumulate and verify the evidence

necessary for the successful prosecution

of persons suspected of violating

criminal laws.

Federal Register / Vol. 65, No. 77 / Thursday, April 20, 2000 / Proposed Rules 21167

(6) 5 U.S.C. 552a(e)(3). This provision

of the Privacy Act requires that an

agency must inform the subject of an

investigation who is asked to supply

information of (A) the authority under

which the information is sought and

whether disclosure of the information is

mandatory or voluntary, (B) the

purposes for which the information is

intended to be used, (C) the routine uses

which may be made of the information,

and (D) the effects on the subject, if any,

of not providing the requested

information. The reasons for exempting

the system of records from the foregoing

provision are as follows:

(i) The disclosure to the subject of an

investigation of the purposes for which

the requested information is intended to

be used would provide the subject with

significant information concerning the

nature of the investigation and could

result in impeding or compromising the

investigation.

(ii) Individuals may be contacted

during preliminary information

gathering, surveys, or compliance

projects concerning the administration

of the internal revenue laws before any

individual is identified as the subject of

an investigation. Informing the

individual of the matters required by

this provision could impede or

compromise subsequent investigations.

(7) 5 U.S.C. 552a(e)(5). This provision

of the Privacy Act requires an agency to

maintain all records which are used in

making any determination about an

individual with such accuracy,

relevance, timeliness, and completeness

as is reasonably necessary to assure

fairness to the individual in the

determination. The reasons for

exempting the system of records from

the foregoing provision are as follows:

Since the law defines ‘‘maintain’’ to

include the collection of information,

compliance with the foregoing provision

would prohibit the initial collection of

any data not shown to be accurate,

relevant, timely, and complete at the

moment of its collection. In gathering

information during the course of a

criminal investigation, it is not always

feasible or possible to determine

completeness, accuracy, timeliness, or

relevancy prior to collection of the

information. Facts are first gathered and

then placed into a cohesive order which

objectively proves or disproves criminal

behavior on the part of a suspect.

Seemingly irrelevant, untimely, or

incomplete information when gathered

may acquire new significance as an

investigation progresses. The

restrictions of the foregoing provision

could impede investigators in the

preparation of a complete investigative

report.

(8) 5 U.S.C. 552a(e)(8). This provision

of the Privacy Act requires an agency to

make reasonable efforts to serve notice

on an individual when any record on

such individual is made available to any

person under compulsory legal process

when such process becomes a matter of

public record. The reasons for

exempting the system of records from

the foregoing provision are as follows:

The notice requirement of the foregoing

provision could prematurely reveal the

existence of criminal investigations to

individuals who are the subjects of such

investigations.

The Department of the Treasury has

determined that this proposed rule is

not a ‘‘significant regulatory action’’

under Executive Order 12866.

Pursuant to the requirements of the

Regulatory Flexibility Act, 5 U.S.C. 601–

612, for the reasons set forth above, it is

hereby certified that this rule will not

have significant economic impact on a

substantial number of small entities.

In accordance with the provisions of

the Paperwork Reduction Act of 1995

(44 U.S.C. 3501 et seq.), the Department

of the Treasury has determined that this

proposed rule would not impose new

recordkeeping, application, reporting, or

other types of information collection

requirements.

List of Subjects in 31 CFR Part 1

Privacy.

Part 1 of Title 31 of the Code of

Federal Regulations is amended as

follows:

Part 1—[Amended]

1. The authority citation for Part 1

continues to read as follows:

Authority: 5 U.S.C. 301 and 31 U.S.C. 321.

Subpart A also issued under 5 U.S.C. 552a as

amended. Subpart C also issued under 5

U.S.C. 552a.

§ 1.36 [Amended]

2. Section 1.36 of Subpart C is

amended by adding the following text in

numerical order to the table in

paragraphs (a)(1) and (b)(1) under the

heading THE INTERNAL REVENUE

SERVICE

* * * * *

(a) * * *

(1) * * *

Name of system No.

*****

Criminal Investigation Audit Trail

Records System ............................ 46.051

*****

* * * * *

(b) * * *

(1) * * *

Name of system No.

*****

Criminal Investigation Audit Trail

Records System ............................ 46.051

*****

* * * * *

Dated: March 7, 2000.

Shelia Y. McCann,

Deputy Assistant Secretary (Administration).

[FR Doc. 00–9869 Filed 4–19–00; 8:45 am]

BILLING CODE 4830–01–P