[Federal Register Volume 60, Number 9 (Friday, January 13, 1995)]
[Proposed Rules]
[Pages 3106-3107]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-617]



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Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of 
the proposed issuance of rules and regulations. The purpose of these 
notices is to give interested persons an opportunity to participate in 
the rule making prior to the adoption of the final rules.

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Federal Register / Vol. 60, No. 9 / Friday, January 13, 1995 / 
Proposed Rules
[[Page 3106]]

DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Part 400

RIN 0563-AB10


General Administrative Regulations; Sanctions

AGENCY: Federal Crop Insurance Corporation, Agriculture.

ACTION: Proposed rule.

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SUMMARY: The Federal Crop Insurance Corporation (FCIC) hereby proposes 
to amend its regulations by setting out the additional sanctions made 
available under the Federal Crop Insurance Act as amended by the 
Federal Crop Insurance Reform Act of 1994 with respect to fines and 
disqualification for willfully and intentionally providing false or 
inaccurate information and ineligibility for the adoption of a material 
scheme or device to obtain benefits.

DATES: Written comments, data, and opinions on this rule must be 
submitted no later than March 14, 1995 to be sure of consideration.

ADDRESSES: Written comments, data, and opinion on this proposed rule 
should be sent to Diana Moslak, Regulatory and Procedural Development 
Staff, Federal Crop Insurance Corporation, USDA, Washington, D.C. 
20250. Hand or messenger delivery should be made to Suite 500, 2101 L 
Street NW., Washington D.C. Written comments will be available for 
public inspection and copying in the Office of the Manager, 2101 L 
Street NW., 5th Floor, Washington, DC, during regular business hours, 
Monday through Friday.

FOR FURTHER INFORMATION CONTACT: Diana Moslak, Federal Crop Insurance 
Corporation, U.S. Department of Agriculture, Washington, D.C. 20250. 
Telephone (202) 254-8314.

SUPPLEMENTARY INFORMATION: This action has been reviewed under United 
States Department of Agriculture (USDA) procedures established by 
Executive Order 12866 and Departmental Regulation 1512-1. This action 
constitutes a review as to the need, currency, clarity, and 
effectiveness of these regulations under those procedures. The sunset 
review date established for these regulations is December 1, 1999.
    This rule has been determined to be ``not significant'' for the 
purposes of Executive Order 12866, and therefore, has not been reviewed 
by the Office of Management and Budget (OMB).
    In accordance with the Paperwork Reduction Act of 1980 (44 U.S.C. 
3501 et seq.), no information collection or record-keeping requirements 
are found in this rule.
    It has been determined under section 6(a) of Executive Order 12612, 
Federalism, that this rule does not have sufficient federalism 
implication to warrant the preparation of a Federalism Assessment. The 
requirements and procedures contained in this rule will not have 
substantial direct effects on states or their political subdivisions, 
or on the distribution of power and responsibilities among the various 
levels of government.
    Under section 605 of the Regulatory Flexibility Act (5 U.S.C. 601-
612), this regulation will not have a significant impact on a 
substantial number of small entities. This action does not increase the 
paperwork burden on the insured producer or the reinsured company. 
Therefore, this action is determined to be exempt from the provisions 
of the Regulatory Flexibility Act and no Regulatory Flexibility 
Analysis was prepared.
    This program is listed in the Catalog of Federal Domestic 
Assistance under No. 10.450.
    This program is not subject to the provisions of Executive Order 
12372 which require intergovernmental consultation with state and local 
officials. See the Notice related to 7 CFR part 3015, subpart V, 
published at 48 FR 29115, June 24, 1983.
    The Office of the General Counsel has determined that these 
regulations meet the applicable standards provided in subsections 2(a) 
and 2(b)(2) of Executive Order 12778. The provisions of this rule will 
preempt state and local laws to the extent such state and local laws 
are inconsistent herewith. This rule does not have retroactive effect 
and administrative appeals as established under 7 CFR part 400 subpart 
J or under regulations established under subtitle H of the Department 
of Agriculture Reorganization Act of 1994 (Pub. L. 103-354) must be 
exhausted before judicial action may be brought.
    This action is not expected to have any significant impact on the 
quality of the human environment, health, and safety. Therefore, 
neither an Environmental Assessment nor an Environmental Impact 
Statement is needed.
    The Federal Crop Insurance Act (FCI Act) was amended by the Federal 
Crop Insurance Reform Act of 1994 (``Reform Act'') on October 13, 1994. 
The Reform Act added a provision to the FCI Act providing that any 
participant in the program who knowingly adopts a material scheme or 
device should lose all benefits under the program for that crop year. 
This provision roughly parallels similar provisions found in USDA 
commodity programs. Eligibility for those programs are now linked to 
the crop insurance program. The Reform Act also amended the FCI Act to 
revise the penalty for giving false or inaccurate information. The 
penalty for those acts previously was administrative debarment from 
participation in the program for a period of up to ten years. However, 
administrative ineligibility for participation in the disaster 
assistance and other commodity programs had previously been two years. 
The Reform Act substituted Catastrophic Risk Protection for Disaster 
Assistance for insurable crops and reduced the maximum administrative 
debarment for Catastrophic Risk Protection to two years so as to 
conform to previous practice. The term for administrative debarment 
when the insured purchases other than catastrophic risk protection 
coverage remains at a maximum of ten years.

List of Subjects in 7 CFR Part 400

    Administrative practice and procedure, Claims, Crop insurance, 
Reporting and recordkeeping requirements.

Proposed Rule

    For the reasons set out in the preamble, subpart R, part 400 of 
chapter IV of title 7 of the Code of Federal Regulations is proposed to 
be amended as follows:
[[Page 3107]]

PART 400--GENERAL ADMINISTRATIVE REGULATIONS

Subpart R--Sanctions

    l. The authority citation for 7 CFR part 400, subpart R, is revised 
to read as follows:

    Authority: 7 U.S.C. 1506(l).

    2. Paragraph (a) of Sec. 400.454 is revised to read as follows:


Sec. 400.454  Civil Penalties.

    (a) Any person who willfully and intentionally provides any false 
or inaccurate information to FCIC or to any approved insurance provider 
reinsured by FCIC with respect to an insurance plan or policy issued 
under the authority of the Federal Crop Insurance Act, as amended, (7 
U.S.C. 1501 et seq.) may be subject to a civil fine of up to $10,000 
for each violation and disqualification from participation in:
    (1) The catastrophic risk protection plan of insurance for a period 
not to exceed two (2) years; or
    (2) Any plan of insurance providing protection in excess of that 
provided under the catastrophic risk protection plan of insurance for a 
period not to exceed ten (10) years.
* * * * *
    3. A new Sec. 400.458 is added to read as follows:


Sec. 400.458  Scheme or device.

    In addition to the penalties specified in this part, if a person 
has knowingly adopted a material scheme or device to obtain 
catastrophic risk protection, other plans of insurance coverage, or 
non-insured assistance benefits to which the person is not entitled, 
has evaded the Federal Crop Insurance Act, or has acted with the 
purpose of evading the Federal Crop Insurance Act, the person shall be 
ineligible to receive any and all benefits applicable to any crop year 
for which the scheme or device was adopted.

    Done in Washington, D.C. on January 5, 1995.
Kenneth D. Ackerman,
Manager, Federal Crop Insurance Corporation.
[FR Doc. 95-617 Filed 1-12-95; 8:45 am]
BILLING CODE 3410-08-P