Rule2025-00167
Civil Penalty Inflation Adjustments
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
January 8, 2025
Effective
January 15, 2025
Issuing agencies
Consumer Financial Protection Bureau
Abstract
The Consumer Financial Protection Bureau (CFPB) is adjusting for inflation the maximum amount of each civil penalty within the CFPB's jurisdiction. These adjustments are required by the Federal Civil Penalties Inflation Adjustment Act of 1990 (Inflation Adjustment Act), as amended by the Debt Collection Improvement Act of 1996 and further amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. The inflation adjustments mandated by the Inflation Adjustment Act serve to maintain the deterrent effect of civil penalties and to promote compliance with the law.
Full Text
<html>
<head>
<title>Federal Register, Volume 90 Issue 5 (Wednesday, January 8, 2025)</title>
</head>
<body><pre>
[Federal Register Volume 90, Number 5 (Wednesday, January 8, 2025)]
[Rules and Regulations]
[Pages 1355-1357]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-00167]
========================================================================
Rules and Regulations
Federal Register
________________________________________________________________________
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.
========================================================================
Federal Register / Vol. 90, No. 5 / Wednesday, January 8, 2025 /
Rules and Regulations
[[Page 1355]]
CONSUMER FINANCIAL PROTECTION BUREAU
12 CFR Part 1083
Civil Penalty Inflation Adjustments
AGENCY: Consumer Financial Protection Bureau.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Consumer Financial Protection Bureau (CFPB) is adjusting
for inflation the maximum amount of each civil penalty within the
CFPB's jurisdiction. These adjustments are required by the Federal
Civil Penalties Inflation Adjustment Act of 1990 (Inflation Adjustment
Act), as amended by the Debt Collection Improvement Act of 1996 and
further amended by the Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015. The inflation adjustments mandated by the
Inflation Adjustment Act serve to maintain the deterrent effect of
civil penalties and to promote compliance with the law.
DATES: This final rule is effective January 15, 2025.
FOR FURTHER INFORMATION CONTACT: George Karithanom, Regulatory
Implementation & Guidance Program Analyst, Office of Regulations, at
(202) 435-7700 or at: <a href="https://reginquiries.consumerfinance.gov">https://reginquiries.consumerfinance.gov</a>. If you
require this document in an alternative electronic format, please
contact <a href="/cdn-cgi/l/email-protection#d89b9e889a8799bbbbbdababb1bab1b4b1aca198bbbea8baf6bfb7ae"><span class="__cf_email__" data-cfemail="65262335273a2406060016160c070c090c111c25060315074b020a13">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION:
I. Background
The Inflation Adjustment Act,\1\ as amended by the Debt Collection
Improvement Act of 1996 \2\ and further amended by the Federal Civil
Penalties Inflation Adjustment Act Improvements Act of 2015,\3\ directs
Federal agencies to adjust the civil penalty amounts within their
jurisdictions for inflation not later than July 1, 2016, and then not
later than January 15 every year thereafter.\4\ Each agency was
required to make the 2016 one-time catch-up adjustments through an
interim final rule published in the Federal Register. On June 14, 2016,
the CFPB published its interim final rule (IFR) to make the initial
catch-up adjustments to civil penalties within the CFPB's
jurisdiction.\5\ The June 2016 IFR created a new part 1083 and in part
1083.1 established the inflation-adjusted maximum amounts for each
civil penalty within the CFPB's jurisdiction.\6\ The CFPB finalized the
IFR on January 31, 2019.\7\
---------------------------------------------------------------------------
\1\ Public Law 101-410, 104 Stat. 890.
\2\ Public Law 104-134, sec. 31001(s)(1), 110 Stat. 1321, 1321-
373.
\3\ Public Law 114-74, sec. 701, 129 Stat. 584, 599.
\4\ Section 1301(a) of the Federal Reports Elimination Act of
1998, Public Law 105-362, 112 Stat. 3293, also amended the Inflation
Adjustment Act by striking section 6, which contained annual
reporting requirements, and redesignating section 7 as section 6,
but did not alter the civil penalty adjustment requirements; 28
U.S.C. 2461 note.
\5\ 81 FR 38569 (June 14, 2016). Although the CFPB was not
obligated to solicit comment for the interim final rule, the CFPB
invited public comment and received none.
\6\ See 12 CFR 1083.1.
\7\ 84 FR 517 (Jan. 31, 2019).
---------------------------------------------------------------------------
The Inflation Adjustment Act also requires subsequent adjustments
to be made annually, not later than January 15, and notwithstanding
section 553 of the Administrative Procedure Act (APA).\8\ The CFPB
annually adjusted its civil penalty amounts, as required by the Act.\9\
---------------------------------------------------------------------------
\8\ Inflation Adjustment Act section 4, codified at 28 U.S.C.
2461 note. As discussed in guidance issued by the Director of the
Office of Management and Budget (OMB), the APA generally requires
notice, an opportunity for comment, and a delay in effective date
for certain rulemakings, but the Inflation Adjustment Act provides
that these procedures are not required for agencies to issue
regulations implementing the annual adjustment. See Memorandum for
the Heads of Exec. Dep'ts & Agencies from Shalanda D. Young,
Director, Implementation of Penalty Inflation Adjustments for 2025,
Pursuant to the Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015, Off. of Mgmt. & Budget (Dec. 17, 2024),
<a href="https://www.whitehouse.gov/wp-content/uploads/2024/12/M-25-02.pdf">https://www.whitehouse.gov/wp-content/uploads/2024/12/M-25-02.pdf</a>
[hereinafter Young Memo].
\9\ See 82 FR 3601 (Jan. 12, 2017); 83 FR 1525 (Jan. 12, 2018);
84 FR 517 (Jan. 31, 2019); 85 FR 2012 (Jan. 14, 2020); 86 FR 3767
(Jan. 15, 2021); 87 FR 2314 (Jan. 14, 2022); 88 FR 1 (Jan. 3, 2023);
89 FR 1787 (Jan. 11, 2024).
---------------------------------------------------------------------------
Specifically, the Inflation Adjustment Act directs Federal agencies
to adjust annually each civil penalty provided by law within the
jurisdiction of each agency by the ``cost-of-living adjustment.'' \10\
The ``cost-of-living adjustment'' is defined as the percentage (if any)
by which the Consumer Price Index for All Urban Consumers (CPI-U) for
the month of October preceding the date of the adjustment, exceeds the
CPI-U for October of the prior year.\11\ The Director of the Office of
Management and Budget (OMB) is required to issue guidance (OMB
Guidance) every year by December 15 to agencies on implementing the
annual civil penalty inflation adjustments. Pursuant to the Inflation
Adjustment Act and OMB Guidance, agencies must apply the multiplier
reflecting the ``cost-of-living adjustment'' to the current penalty
amount and then round that amount to the nearest dollar to determine
the annual adjustments.\12\ The adjustments are designed to keep pace
with inflation so that civil penalties retain their deterrent effect
and promote compliance with the law.\13\
---------------------------------------------------------------------------
\10\ Inflation Adjustment Act sections 4 and 5, codified at 28
U.S.C. 2461 note.
\11\ Inflation Adjustment Act sections 3 and 5, codified at 28
U.S.C. 2461 note.
\12\ Inflation Adjustment Act section 5, codified at 28 U.S.C.
2461 note; see also Young Memo.
\13\ See Inflation Adjustment Act section 2, codified at 28
U.S.C. 2461 note.
---------------------------------------------------------------------------
For the 2025 annual adjustment, the multiplier reflecting the
``cost-of-living adjustment'' is 1.02598.
II. Adjustment
Pursuant to the Inflation Adjustment Act and OMB Guidance, the CFPB
multiplied each of its civil penalty amounts by the ``cost-of-living
adjustment'' multiplier and rounded to the nearest dollar.\14\ The new
penalty amounts that apply to civil penalties assessed after January
15, 2025, are as follows:
---------------------------------------------------------------------------
\14\ Inflation Adjustment Act section 4, codified at 28 U.S.C.
2461 note.
[[Page 1356]]
----------------------------------------------------------------------------------------------------------------
Penalty
amounts OMB ``cost-of-
Law Penalty description established living New penalty
under 2024 adjustment'' amount \15\
final rule multiplier
----------------------------------------------------------------------------------------------------------------
Consumer Financial Protection Act, 12 Tier 1 penalty.......... $7,034 1.02598 $7,217
U.S.C. 5565(c)(2)(A).
Consumer Financial Protection Act, 12 Tier 2 penalty.......... 35,169 1.02598 36,083
U.S.C. 5565(c)(2)(B).
Consumer Financial Protection Act, 12 Tier 3 penalty.......... 1,406,728 1.02598 1,443,275
U.S.C. 5565(c)(2)(C).
Interstate Land Sales Full Disclosure Per violation........... 2,451 1.02598 2,515
Act, 15 U.S.C. 1717a(a)(2).
Interstate Land Sales Full Disclosure Annual cap.............. 2,449,575 1.02598 2,513,215
Act, 15 U.S.C. 1717a(a)(2).
Real Estate Settlement Procedures Act, Per failure............. 115 1.02598 118
12 U.S.C. 2609(d)(1).
Real Estate Settlement Procedures Act, Annual cap.............. 230,464 1.02598 236,451
12 U.S.C. 2609(d)(1).
Real Estate Settlement Procedures Act, Per failure, where 230 1.02598 236
12 U.S.C. 2609(d)(2)(A). intentional.
SAFE Act, 12 U.S.C. 5113(d)(2)........ Per violation........... 35,516 1.02598 36,439
Truth in Lending Act, 15 U.S.C. First violation......... 14,069 1.02598 14,435
1639e(k)(1).
Truth in Lending Act, 15 U.S.C. Subsequent violations... 28,135 1.02598 28,866
1639e(k)(2).
----------------------------------------------------------------------------------------------------------------
III. Procedural Requirements
---------------------------------------------------------------------------
\15\ Numbers may not multiply to totals shown because of
rounding.
---------------------------------------------------------------------------
A. Administrative Procedure Act
Under the APA, notice and opportunity for public comment are not
required if the CFPB finds that notice and public comment are
impracticable, unnecessary, or contrary to the public interest.\16\ The
adjustments to the civil penalty amounts are technical and non-
discretionary, and they merely apply the statutory method for adjusting
civil penalty amounts. These adjustments are required by the Inflation
Adjustment Act. Moreover, the Inflation Adjustment Act directs agencies
to adjust civil penalties annually notwithstanding section 553 of the
APA,\17\ and OMB Guidance reaffirms that agencies need not complete a
notice-and-comment process before making the annual adjustments for
inflation.\18\ For these reasons, the CFPB has determined that
publishing a notice of proposed rulemaking and providing opportunity
for public comment are unnecessary. The amendments therefore are
adopted in final form.
---------------------------------------------------------------------------
\16\ 5 U.S.C. 553(b)(B).
\17\ Inflation Adjustment Act section 4, codified at 28 U.S.C.
2461 note.
\18\ Young Memo.
---------------------------------------------------------------------------
Section 553(d) of the APA generally requires publication of a final
rule not less than 30 days before its effective date, except (1) a
substantive rule which grants or recognizes an exemption or relieves a
restriction; (2) interpretive rules and statements of policy; or (3) as
otherwise provided by the agency for good cause found and published
with the rule.\19\ At minimum, the CFPB believes the annual adjustments
to the civil penalty amounts in Sec. 1083.1(a) fall under the third
exception to section 553(d). The CFPB finds that there is good cause to
make the amendments effective on January 15, 2025. The amendments to
Sec. 1083.1(a) in this final rule are technical and non-discretionary,
and they merely apply the statutory method for adjusting civil penalty
amounts and follow the statutory directive to make annual adjustments
each year. Moreover, the Inflation Adjustment Act directs agencies to
adjust the civil penalties annually notwithstanding section 553 of the
APA,\20\ and OMB Guidance reaffirms that agencies need not provide a
delay in effective date for the annual adjustments for inflation.\21\
---------------------------------------------------------------------------
\19\ 5 U.S.C. 553(d).
\20\ Inflation Adjustment Act section 4, codified at 28 U.S.C.
2461 note.
\21\ Young Memo.
---------------------------------------------------------------------------
B. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) does not apply to a rulemaking
where a general notice of proposed rulemaking is not required.\22\ As
noted previously, the CFPB has determined that it is unnecessary to
publish a general 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.
---------------------------------------------------------------------------
\22\ 5 U.S.C. 603(a), 604(a).
---------------------------------------------------------------------------
C. Paperwork Reduction Act
In accordance with the Paperwork Reduction Act of 1995,\23\ the
CFPB reviewed this final rule. The CFPB has determined that this rule
does not create any new information collections or substantially revise
any existing collections.
---------------------------------------------------------------------------
\23\ 44 U.S.C. 3506; 5 CFR part 1320.
---------------------------------------------------------------------------
D. Congressional Review Act
Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.),
the CFPB will submit a report containing this rule and other required
information to the United States Senate, the United States House of
Representatives, and the Comptroller General of the United States prior
to the rule taking effect. The Office of Information and Regulatory
Affairs (OIRA) has designated this rule as not a ``major rule'' as
defined by 5 U.S.C. 804(2).
List of Subjects in 12 CFR Part 1083
Administrative practice and procedure, Consumer protection,
Penalties.
Authority and Issuance
For the reasons set forth in the preamble, the CFPB amends 12 CFR
part 1083, as set forth below:
PART 1083--CIVIL PENALTY ADJUSTMENTS
0
1. The authority citation for part 1083 continues to read as follows:
Authority: 12 U.S.C. 2609(d); 12 U.S.C. 5113(d)(2); 12 U.S.C.
5565(c); 15 U.S.C. 1639e(k); 15 U.S.C. 1717a(a); 28 U.S.C. 2461
note.
0
2. Section 1083.1 is revised to read as follows:
Sec. 1083.1 Adjustment of civil penalty amounts.
(a) The maximum amount of each civil penalty within the
jurisdiction of the Consumer Financial Protection Bureau to impose is
adjusted in accordance with the Federal Civil Penalties Inflation
Adjustment Act of 1990, as amended by the Debt Collection Improvement
Act of 1996 and further amended by the Federal Civil Penalties
Inflation Adjustment Act Improvements Act of 2015 (28 U.S.C. 2461
note), as follows:
[[Page 1357]]
Table 1 to Paragraph (a)
------------------------------------------------------------------------
Adjusted maximum
Law Penalty civil penalty
description amount
------------------------------------------------------------------------
12 U.S.C. 5565(c)(2)(A)......... Tier 1 penalty.... $7,217
12 U.S.C. 5565(c)(2)(B)......... Tier 2 penalty.... 36,083
12 U.S.C. 5565(c)(2)(C)......... Tier 3 penalty.... 1,443,275
15 U.S.C. 1717a(a)(2)........... Per violation..... 2,515
15 U.S.C. 1717a(a)(2)........... Annual cap........ 2,513,215
12 U.S.C. 2609(d)(1)............ Per failure....... 118
12 U.S.C. 2609(d)(1)............ Annual cap........ 236,451
12 U.S.C. 2609(d)(2)(A)......... Per failure, where 236
intentional.
12 U.S.C. 5113(d)(2)............ Per violation..... 36,439
15 U.S.C. 1639e(k)(1)........... First violation... 14,435
15 U.S.C. 1639e(k)(2)........... Subsequent 28,866
violations.
------------------------------------------------------------------------
(b) The adjustments in paragraph (a) of this section shall apply to
civil penalties assessed after January 15, 2025, whose associated
violations occurred on or after November 2, 2015.
Brian Shearer,
Assistant Director, Office of Policy Planning and Strategy, Consumer
Financial Protection Bureau.
[FR Doc. 2025-00167 Filed 1-7-25; 8:45 am]
BILLING CODE 4810-AM-P
</pre><script data-cfasync="false" src="/cdn-cgi/scripts/5c5dd728/cloudflare-static/email-decode.min.js"></script></body>
</html>Indexed from Federal Register on January 8, 2025.
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.