Notice2024-19593
Agency Information Collection Activities; Submission for OMB Review; Comment Request; Customer Identification Program Regulatory Requirements for Certain Financial Institutions
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
August 30, 2024
Issuing agencies
Treasury Department
Abstract
The Department of the Treasury will submit the following information collection requests to the Office of Management and Budget (OMB) for review and clearance in accordance with the Paperwork Reduction Act of 1995, on or after the date of publication of this notice. The public is invited to submit comments on these requests.
Full Text
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<title>Federal Register, Volume 89 Issue 169 (Friday, August 30, 2024)</title>
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[Federal Register Volume 89, Number 169 (Friday, August 30, 2024)]
[Notices]
[Pages 70690-70692]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-19593]
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DEPARTMENT OF THE TREASURY
Agency Information Collection Activities; Submission for OMB
Review; Comment Request; Customer Identification Program Regulatory
Requirements for Certain Financial Institutions
AGENCY: Departmental Offices, U.S. Department of the Treasury.
ACTION: Notice of information collection; request for comment.
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SUMMARY: The Department of the Treasury will submit the following
information collection requests to the Office of Management and Budget
(OMB) for review and clearance in accordance with the Paperwork
Reduction Act of 1995, on or after the date of publication of this
notice. The public is invited to submit comments on these requests.
DATES: Comments should be received on or before September 30, 2024 to
be assured of consideration.
ADDRESSES: Written comments and recommendations for the proposed
information collection should be sent within 30 days of publication of
this notice to <a href="http://www.reginfo.gov/public/do/PRAMain">www.reginfo.gov/public/do/PRAMain</a>. Find this particular
information collection by selecting ``Currently under 30-day Review--
Open for Public Comments'' or by using the search function.
FOR FURTHER INFORMATION CONTACT: Copies of the submissions may be
obtained from Spencer W. Clark by emailing <a href="/cdn-cgi/l/email-protection#c8989a8988bcbaada9bbbdbab1e6afa7be"><span class="__cf_email__" data-cfemail="c696948786b2b4a3a7b5b3b4bfe8a1a9b0">[email protected]</span></a>, calling
(202) 927-5331, or viewing the entire information collection request at
<a href="http://www.reginfo.gov">www.reginfo.gov</a>.
SUPPLEMENTARY INFORMATION:
Financial Crimes Enforcement Network (FinCEN)
Title: Customer Identification Program Regulatory Requirements for
Certain Financial Institutions.
OMB Control Numbers: 1506-0022, 1506-0026, 1506-0033, 1506-0034.
Type of Review: Extension without change of a currently approved
collection.
Description: The legislative framework generally referred to as the
Bank Secrecy Act (BSA) consists of the Currency and Foreign
Transactions Reporting Act of 1970, as amended by the Uniting and
Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act) and
other legislation, including the Anti-Money Laundering Act of 2020 (AML
Act). The BSA is codified at 12 U.S.C. 1829b, 1951-1960 and 31 U.S.C.
5311-5314, 5316-5336, including notes thereto, with implementing
regulations at 31 CFR chapter X.
The BSA authorizes the Secretary of the Treasury (Secretary) to,
inter alia, require financial institutions to keep records and file
reports that are determined to have a high degree of usefulness in
criminal, tax, or regulatory matters, risk assessments or proceedings,
or in the conduct of intelligence or counter-intelligence activities to
protect against terrorism, and to implement anti-money laundering/
countering the financing of terrorism (AML/CFT) programs and compliance
procedures. The authority of the Secretary to administer the BSA has
been delegated to the Director of FinCEN.
Title 31 U.S.C. 5318(l) requires the Secretary to issue regulations
prescribing minimum standards for customer identification programs
(CIPs) for financial institutions. Regulations implementing section
5318(l) are as follows: (i) banks (31 CFR 1020.220); (ii) brokers-
dealers (31 CFR 1023.220); (iii) mutual funds (31 CFR 1024.220); and
(iv) futures commission merchants and introducing brokers in
commodities (31 CFR 1026.220). Under the CIP regulations, the minimum
requirements include: (1) implementation of a written customer
identification program appropriate for the financial institution's size
and type of business; (2) identity verification procedures; (3)
[[Page 70691]]
recordkeeping; (4) comparison with government lists; and (5) customer
notice. The CIP may also include procedures specifying when a financial
institution may rely on another financial institution to perform any of
the financial institution's CIP procedures, provided certain conditions
are met.
Form: None.
Affected Public: Businesses or other for-profit institutions, and
non-profit institutions.
Estimated Number of Respondents: 16,232 financial institutions.
Frequency of Response: On occasion.
Estimated Recordkeeping Burden and Cost:
In Part 1 of this notice, FinCEN describes the distribution of the
estimated number of covered financial institutions, by type, and the
estimated number of new accounts opened per year, by type of covered
financial institution. In addition, Part 1 describes the primary
characteristics of covered financial institutions' CIP requirements. In
Part 2, FinCEN describes calculations of the estimated annual PRA
burden based on methodology that was updated in response to public
comments received following the initial Federal Register notice
published on June 20, 2024 (89 FR 51940).
Part 1. Distribution of the Financial Institutions and New Accounts
Covered by This Notice
The distribution of financial institutions and new accounts opened
annually that are covered by this notice, by type of financial
institution, is as follows:
Table 1--Distribution of Financial Institutions and New Accounts Covered by This Notice, by Type of Financial
Institution
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Number of new
Type of financial institution Number of financial accounts opened
institutions annually
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0022 Futures commission merchants and introducing brokers in 954 557,000
commodities......................................................
0026 Banks........................................................ 10,400 53,615,000
0033 Mutual Funds................................................. 1,400 16,150,000
0034 Brokers-dealers.............................................. 3,478 28,000,000
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Total......................................................... 16,232 98,322,000
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In connection with a variety of initiatives FinCEN is undertaking
to implement the AML Act, FinCEN intends to conduct, in the future,
additional assessments of the PRA burden associated with BSA
requirements.
Part 2. Annual PRA Burden and Cost
For all covered financial institutions, FinCEN continues estimating
the incremental annual PRA recordkeeping burden associated with
maintaining and updating the CIP (``maintenance'') at ten hours per
financial institution. This estimate covers: (a) an average of
approximately nine hours per financial institution per year associated
with the burden of updating the records necessary to demonstrate
compliance with CIP requirements to take into consideration any
regulatory changes and any modifications required as a result of a
financial institution making changes to the type of accounts
maintained, the methods used to open accounts, and the types of
documentary or nondocumentary methods for verifying identifying
information the financial institution intends to use; and (b) an
average of approximately one hour per financial institution associated
with the burden of presenting the updated CIP to the appropriate level
of management within the financial institution and obtaining approval.
In addition, FinCEN continues estimating the incremental annual PRA
recordkeeping burden associated with providing customers with
notification of the CIP (``notification'') at one hour per financial
institution. FinCEN has increased the estimate of the incremental
annual PRA recordkeeping burden associated with obtaining and verifying
a customer's identity (i.e., verification and recordkeeping
requirements, and consulting government lists) (``implementation'') to
three minutes per new account opened.
Under these assumptions, FinCEN's estimate of the annual
incremental PRA burden is 5,094,652 hours, as detailed in tables 2 and
3.
Table 2--Incremental Annual Burden Associated With Updating and Maintaining the CIP and Customer Notification for All Covered Financial Institutions
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Time per financial Burden hours per step
Number of institution ------------------------------ Total
Type of financial institution financial ------------------------------ burden
institutions Maintenance Notification Maintenance Notification hours
(hours) (hour)
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0022 Futures commission merchants and introducing brokers in 954 10 1 9,540 954 10,494
commodities......................................................
0026 Banks........................................................ 10,400 10 1 104,000 10,400 114,400
0033 Mutual Funds................................................. 1,400 10 1 14,000 1,400 15,400
0034 Brokers-dealers.............................................. 3,478 10 1 34,780 3,478 38,258
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Total......................................................... 16,232 ............ .............. 162,320 16,232 178,552
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Table 3--Incremental Annual Burden Associated With Implementing the Identity Verification, Recordkeeping, and
Consulting Government Lists Requirements for All Covered Financial Institutions
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Number of New accounts Time per new Total burden
Type of financial institution financial opened per account Total burden converted to
institutions year (minutes) in minutes hours
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0022 Futures commission merchants 954 557,000 3 1,671,000 27,850
and introducing brokers in
commodities........................
[[Page 70692]]
0026 Banks.......................... 10,400 53,615,000 3 160,845,000 2,680,750
0033 Mutual Funds................... 1,400 16,150,000 3 48,450,000 807,500
0034 Brokers-dealers................ 3,478 28,000,000 3 84,000,000 1,400,000
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Total........................... 16,232 98,322,000 ............ 294,966,000 4,916,100
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FinCEN is utilizing the same fully loaded composite hourly wage
rate of $106.30 utilized in other OMB control number renewals and
notices of proposed rulemakings (NPRMs) recently opened to public
review and comment. The total estimated cost of the annual PRA burden
is $541,561,508, as reflected in table 4 below:
Table 4--Total Cost of Annual PRA Burden
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Task Hours Hourly cost Total cost
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Maintaining and updating the CIP (10 hours per FI).............. 162,320 $106.30 $17,254,616
Customer notification of CIP (1 hour per FI).................... 16,232 106.30 1,725,462
Implementing the CIP (identifying and verifying customer 4,916,100 106.30 522,581,430
information, maintain records, and consulting government lists)
(2 minutes per account.........................................
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Total....................................................... 5,094,652 .............. $541,561,508
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Authority: 44 U.S.C. 3501 et seq.
Spencer W. Clark,
Treasury PRA Clearance Officer.
[FR Doc. 2024-19593 Filed 8-29-24; 8:45 am]
BILLING CODE 4810-02-P
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