Rule2021-27623
Bank Secrecy Act Regulations-Reports of Foreign Financial Accounts Civil Penalties
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
December 23, 2021
Effective
December 23, 2021
Issuing agencies
Treasury DepartmentFinancial Crimes Enforcement Network
Abstract
FinCEN is amending the Bank Secrecy Act civil penalty regulations relating to the requirements for reporting foreign financial accounts and for reporting transactions with foreign financial agencies. The amendments remove civil penalty language, which was made obsolete with the enactment of the American Jobs Creation Act of 2004. The American Jobs Creation Act of 2004 revised the manner for computing the penalty, including providing a greater maximum penalty for willful violations than was previously authorized.
Full Text
<html>
<head>
<title>Federal Register, Volume 86 Issue 244 (Thursday, December 23, 2021)</title>
</head>
<body><pre>
[Federal Register Volume 86, Number 244 (Thursday, December 23, 2021)]
[Rules and Regulations]
[Pages 72844-72845]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2021-27623]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Financial Crimes Enforcement Network
31 CFR Part 1010
RIN 1506-AB53
Bank Secrecy Act Regulations--Reports of Foreign Financial
Accounts Civil Penalties
AGENCY: Financial Crimes Enforcement Network (FinCEN), Treasury.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: FinCEN is amending the Bank Secrecy Act civil penalty
regulations relating to the requirements for reporting foreign
financial accounts and for reporting transactions with foreign
financial agencies. The amendments remove civil penalty language, which
was made obsolete with the enactment of the American Jobs Creation Act
of 2004. The American Jobs Creation Act of 2004 revised the manner for
computing the penalty, including providing a greater maximum penalty
for willful violations than was previously authorized.
DATES: Effective Date: The final rule is effective December 23, 2021.
FOR FURTHER INFORMATION CONTACT: The FinCEN Regulatory Support Section
at 1-800-767-2825 or electronically at <a href="https://fincen.gov/contact">https://fincen.gov/contact</a>.
SUPPLEMENTARY INFORMATION:
I. Background
The purposes of the Bank Secrecy Act (BSA), Titles I and II of
Public Law 91-508, as amended, codified at 12 U.S.C. 1829b, 12 U.S.C.
1951-1959, and 31 U.S.C. 5311-5314 and 5316-5336, include, among other
things, requiring certain reports or records that are highly useful in
criminal, tax, or regulatory investigations. The regulations
implementing the BSA appear at 31 CFR chapter X. The Secretary's
authority to administer the BSA has been delegated to the Director of
FinCEN.\1\
---------------------------------------------------------------------------
\1\ See Treasury Order 180-01 (Jan. 14, 2020).
---------------------------------------------------------------------------
Pursuant to 31 U.S.C. 5314, the Secretary is authorized to require
any ``resident or citizen of the United States or a person in, and
doing business in, the United States, to . . . keep records and file
reports, when the resident, citizen, or person makes a transaction or
maintains a relation for any person with a foreign financial agency.''
The regulations implementing 31 U.S.C. 5314 appear at 31 CFR 1010.350,
1010.360, and 1010.420. Section 1010.350 sets forth the requirements
for filing a Foreign Bank Account Report (FBAR), which generally
require each U.S. person having a financial interest in, or signature
or other authority over, a bank, securities, or other financial account
in a foreign country to report such relationship for each year in which
such relationship exists. Section 1010.420 outlines the recordkeeping
requirements associated with foreign financial accounts required to be
reported under Section 1010.350. Section 1010.360, commonly referred to
as the report of foreign financial agency transactions, provides that
FinCEN may promulgate regulations requiring specified financial
institutions to file reports of certain transactions with designated
foreign financial agencies.
II. Civil Monetary Penalty
Section 5321 of Title 31 of the U.S. Code describes civil monetary
penalties for violations of the BSA. In October 1986, Congress amended
31 U.S.C. 5321 to add a provision--31 U.S.C. 5321(a)(5)--authorizing a
civil monetary penalty for willful violations of section 5314. (Pub. L.
99-570, section 1357(c), October 26, 1986) (``the Anti-Drug Abuse Act
of 1986'' or the ``1986 Act'')). The terms of the 1986 amendment were
incorporated into the BSA implementing regulations at 31 CFR
1010.820(g).\2\
---------------------------------------------------------------------------
\2\ 52 FR 11436, April 8, 1987.
---------------------------------------------------------------------------
The American Jobs Creation Act of 2004 amended 31 U.S.C.
5321(a)(5). The amendments revised the manner in which the penalty is
calculated, including an increase to the maximum amount that could be
assessed for willful violations of section 5314.
III. Section by Section Analysis
Section 821 of the American Jobs Creation Act of 2004 is self-
executing, and the penalty provisions apply to violations occurring
after the date of its enactment. For those reasons, the provisions in
31 CFR 1010.820(g) are obsolete and superseded by statute. FinCEN is
therefore rescinding 31 CFR 1010.820(g). The remaining paragraphs (h)
and (i) in Sec. 1010.820 are redesignated as paragraphs (g) and (h).
IV. Administrative Procedure Act and Effective Date
Under 5 U.S.C. 553(b)(3)(B) of the Administrative Procedure Act
(APA), an agency may, for good cause, find (and incorporate the finding
and a brief statement of reasons therefore in the rules issued) that
notice and public procedure thereon are impracticable, unnecessary, or
contrary to the public interest. The final rule rescinds civil penalty
regulations at 31 CFR 1010.820(g)(1) and (2) because they have been
rendered obsolete with the 2004 amendments to 31 U.S.C. 5321(a)(5). The
agency has therefore determined that publishing a notice of proposed
rulemaking and providing opportunity for public comment is unnecessary.
This amendment to the regulations merely conforms the regulations to
the current statute.
Under 5 U.S.C. 553(d)(3) of the APA, the required publication or
service of a substantive rule shall be made not less than 30 days
before its effective date, except, among other things, as provided by
the agency for good cause found and published with the rule. FinCEN
finds that there is good cause for shortened notice since 31 CFR
1010.820(g) is obsolete and the revisions made by this final rule are
non-substantive and technical. This final rule takes effect on December
23, 2021.
V. Regulatory Flexibility Act
The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) (RFA) does
not apply to a rulemaking where a general notice of proposed rulemaking
is not required. As noted above, FinCEN has determined that it is
unnecessary to publish a notice of proposed rulemaking for this final
rule. Accordingly, the RFA's requirements relating to an initial and
final regulatory flexibility analysis do not apply.
VI. Executive Order 13563 and 12866
Executive Orders 13563 and 12866 direct agencies to assess costs
and benefits of available regulatory alternatives and, if regulation is
necessary, to select regulatory approaches that maximize net benefits
(including potential economic, environmental, public health and safety
effects, distributive impacts, and equity). Executive Order 13563
emphasizes the importance of quantifying both costs and benefits, of
reducing costs, of harmonizing rules, and of promoting flexibility.
FinCEN
[[Page 72845]]
has determined that Executive Orders 13563 and 12866 do not apply to
this final rulemaking.
VII. Paperwork Reduction Act (PRA) Notices
There is no collection of information requirement in this final
rule.
VIII. Unfunded Mandates Act of 1995 Statement
Section 202 of the Unfunded Mandates Reform Act of 1995, 12 U.S.C.
1532, Public Law 104-4 (March 22, 1995) (Unfunded Mandates Act),
requires that an agency prepare a budgetary impact statement before
promulgating a rule that may result in expenditure by state, local, and
tribal governments, in the aggregate, or by the private sector, of $100
million or more in any one year. If a budgetary impact statement is
required, Section 202 of the Unfunded Mandates Act also requires an
agency to identify and consider a reasonable number of regulatory
alternatives before promulgating a rule. FinCEN has determined that no
portion of this final rule will result in expenditures by State, local,
and tribal governments, or by the private sector, of $100 million or
more in any one year. Accordingly, this final rule is not subject to
section 202 of the Unfunded Mandates Act.
List of Subjects in 31 CFR Part 1010
Administrative practice and procedure, Banks, Banking, Brokers,
Currency, Foreign banking, Foreign currencies, Gambling,
Investigations, Penalties, Reporting and recordkeeping requirements,
Securities, Terrorism.
Amendments to the Regulations
For the reasons set forth above in the preamble, 31 CFR part 1010
is amended as follows:
PART 1010--GENERAL PROVISIONS
0
1. The authority citation for part 1010 is revised to read as follows:
Authority: 12 U.S.C. 1829b and 1951-1960; 31 U.S.C. 5311-5314
and 5316-5336; title III, sec. 314, Pub. L. 107-56, 115 Stat. 307;
sec. 701, Pub. L. 114-74, 129 Stat. 599.
Sec. 1010.820 [Amended]
0
2. Section 1010.820 is amended as follows:
0
a. Remove paragraph (g); and
0
b. Redesignate paragraphs (h) and (i) as paragraphs (g) and (h).
Himamauli Das,
Acting Director, Financial Crimes Enforcement Network.
[FR Doc. 2021-27623 Filed 12-22-21; 8:45 am]
BILLING CODE 4810-02-P[FEDREG][VOL]*[/VOL][NO]*[/NO][DATE]*[/
DATE][RULES]
</pre></body>
</html>Indexed from Federal Register on December 23, 2021.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.