[Federal Register: June 20, 2003 (Volume 68, Number 119)]
[Proposed Rules]
[Page 36955-36957]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr20jn03-37]
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DEPARTMENT OF THE TREASURY
Office of the Secretary of the Treasury
Fiscal Service
31 CFR Parts 1 and 323
Privacy Act of 1974; Proposed Implementation
AGENCY: Bureau of the Public Debt, Treasury.
ACTION: Notice of proposed rulemaking.
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SUMMARY: With the concurrence of the Department of the Treasury
(Department), the Bureau of the Public Debt (Public Debt) issues a
proposed rulemaking to amend its regulations to exempt a system of
records from certain provisions of the Privacy Act. Lastly, we are
amending regulations to clarify when personal privacy interests may be
protected upon the death of a securities holder.
DATES: Comments must be received no later than July 21, 2003.
ADDRESSES: Send any comments to the Disclosure Officer, Administrative
Resource Center, Bureau of the Public Debt, Department of the Treasury,
200 Third Street, Room 211, Parkersburg, WV 26101-5312. Copies of all
written comments will be available for public inspection and copying at
the Department of the Treasury Library, Room 1428, Main Treasury
Building, Washington, DC 20220. Before visiting the library, you must
call 202-622-0990 for an appointment. Also, you can download comments
at the following World Wide Web address: ``http://www.publicdebt.treas.gov
''.
FOR FURTHER INFORMATION CONTACT: For information about Public Debt's
anti-money laundering and fraud suppression program, contact the Fraud
Inquiry Line at (304) 480-8555. The phone line is administered by the
Office of the Chief Counsel, Bureau of the Public Debt. For information
about this document, contact the Office of the Chief Counsel, Bureau of
the Public Debt, at (304) 480-8692.
SUPPLEMENTARY INFORMATION: Under the Privacy Act of 1974, 5 U.S.C.
552a, as amended, a Federal agency is required, among other things, to:
(1) Maintain only information about an individual that is relevant and
necessary to accomplish an authorized purpose; (2) Notify an individual
whether information about him or her is maintained in a system of
records; (3) Provide an individual with access to the records
containing information about him or her, including an accounting of
disclosures made of that information; (4) Permit an individual to
request amendment of records about him or her; and (5) Describe in
system notices the sources of information maintained about individuals
and the procedures under which notice, access and amendment rights may
be exercised. Under certain circumstances, however, the head of a
Federal agency may issue rules to exempt a system of records.
Public Debt is publishing separately in the Federal Register a
notice establishing a new system of records, Treasury/BPD.009--U.S.
Treasury Securities Fraud Information System. In that regard, Public
Debt proposes to exempt the new system from certain Privacy Act
requirements. The head of an agency may promulgate rules to exempt a
system of records from certain provisions under 5 U.S.C. 552a(k)(2) if
the system of records is ``investigatory material compiled for law
enforcement purposes, other than material within the scope of
subsection (j)(2) of this section.''
Accordingly, pursuant to the authority contained in section 31 CFR
1.23(c)(2), Public Debt proposes to exempt the system from certain
provisions of the Privacy Act pursuant to 5 U.S.C. 552a(k)(2).
This system will be exempt from 5 U.S.C. 552a(c)(3) (Accounting of
certain disclosures available to the individual), (d)(1)-(4) (Access to
records), (e)(1) (Maintenance of information to accomplish purposes
authorized by statute or executive order only), (e)(4)(G) (Publication
of procedures for notification), (e)(4)(H) (Publication of procedures
for access and contest), (e)(4)(I) (Publication of sources of records),
and (f) (Rules for notification, access and contest) to the extent that
information in the system is subject to exemption pursuant to 5 U.S.C.
552a(k)(2) as material compiled for law enforcement purposes.
The reasons for exemptions under 5 U.S.C. 552a(k)(2) are as
follows:
(1) 5 U.S.C. 552a(c)(3) requires an agency to make accountings of
disclosures of a record available to the individual named in the record
upon his or her request. The accountings must state the date, nature,
and purpose of each disclosure of the record and the name and address
of the recipient. Application of this provision would impair the
ability of Public Debt and of law enforcement agencies to make
effective use of information maintained by Public Debt. Access to such
knowledge would impair the ability of Public Debt and law enforcement
to carry out their mission, since individuals could:
(a) Take steps to avoid detection;
(b) Inform associates that an investigation is in process;
(c) Learn the nature of the investigation;
(d) Learn whether they are only suspects or identified as law
violators;
(e) Begin, continue, or resume illegal conduct upon learning that
they are not identified in the system of records; or
(f) Destroy evidence needed to prove the violation.
(2)(a) 5 U.S.C. 552a(d)(1), (e)(4)(H) and (f)(2), (3) and (5) grant
individuals access to records pertaining to them. The application of
these provisions to the system of records would compromise Public
Debt's ability to utilize and provide useful tactical and strategic
information to law enforcement agencies.
(b) Permitting access to records contained in the system of records
would provide individuals with information concerning the nature of any
current investigations and would enable them to avoid detection or
apprehension by:
(i) Discovering the facts that would form the basis for their
detection or apprehension;
(ii) Enabling them to destroy or alter evidence of illegal conduct
that would form the basis for their detection or apprehension;
(iii) Using knowledge that investigators had reason to believe that
a violation of law was about to be committed, to delay the commission
of the violation or commit it at a location that might not be under
surveillance;
(c) Permitting access to either on-going or closed investigative
files would also reveal investigative techniques and
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procedures, the knowledge of which could enable individuals planning
illegal acts to structure their operations so as to avoid detection or
apprehension;
(d) Permitting access to investigative files and records could,
moreover, disclose the identity of confidential sources and informers
and the nature of the information supplied and thereby endanger the
physical safety of those sources by exposing them to possible reprisals
for having provided the information. Confidential sources and informers
might refuse to provide investigators with valuable information unless
they believed that their identities would not be revealed through
disclosure of their names or the nature of the information they
supplied. Loss of access to such sources would seriously impair law
enforcement and Public Debt's ability to carry out their mandate.
(e) Furthermore, providing access to records contained in the
system of records could reveal the identities of undercover law
enforcement officers or other persons who compiled information
regarding the individual's illegal activities and thereby endanger the
physical safety of those officers, persons, or their families by
exposing them to possible reprisals.
(f) By compromising the law enforcement value of the system of
records for the reasons outlined in paragraphs (b) through (e) of this
section, permitting access in keeping with these provisions would
discourage other law enforcement and regulatory agencies, foreign and
domestic, from freely sharing information with Public Debt and thus
would restrict Public Debt's access to information necessary to
accomplish its mission most effectively.
(g) Finally, the dissemination of certain information that Public
Debt may maintain in the system of records is restricted by law.
Disclosure of the record to the subject pursuant to subsections (c)(3)
or (d)(1)-(4) of the Privacy Act would violate the non-notification
provision of the Bank Secrecy Act, 31 U.S.C. 5318(g)(2), under which
there is a prohibition from notifying a transaction participant that a
suspicious transaction report has been made. In addition, the access
provisions of subsections (c)(3) and (d) of the Privacy Act would alert
individuals that they have been identified as suspects or possible
subjects of investigation and thus seriously hinder the law enforcement
purposes underlying the suspicious transaction reports.
(3) 5 U.S.C. 552a(d)(2), (3), and (4), (e)(4)(H), and (f)(4) permit
an individual to request amendment of a record pertaining to him or her
and require the agency either to amend the record, or to note the
disputed portion of the record and to provide a copy of the
individual's statement of disagreement with the agency's refusal to
amend a record to persons or other agencies to whom the record is
thereafter disclosed. Since these provisions depend on the individual's
having access to his or her records, and since these rules exempt the
system of records from the provisions of 5 U.S.C. 552a relating to
access to records, for the reasons set out in subparagraphs (b) through
(g) of paragraph (2), above, these provisions should not apply to the
system of records.
(4)(a) 5 U.S.C. 552a(e)(1) requires an 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 term ``maintain'' as
defined in 5 U.S.C. 552a(a)(3), includes ``collect'' and
``disseminate.'' The application of this provision to the system of
records could impair Public Debt's ability to collect, utilize, and
disseminate valuable information to law enforcement.
(b) At the time that Public Debt collects information, it often
lacks sufficient time to determine whether the information is relevant
and necessary to accomplish a Public Debt purpose.
(c) In many cases, especially in the early stages of investigation,
it may be impossible immediately to determine whether information
collected is relevant and necessary, and information that initially
appears irrelevant and unnecessary often may, upon further evaluation
or upon collation with information developed subsequently, prove
particularly relevant to a law enforcement program.
(d) Not all violations of law discovered by Public Debt employees
fall within the jurisdiction of Public Debt. Public Debt will have to
disclose such violations to other law enforcement agencies, including
State, local, and foreign agencies that have jurisdiction over the
offenses to which the information relates.
(5) 5 U.S.C. 552a(e)(4)(I) requires an agency to publish a general
notice listing the categories of sources for information contained in a
system of records. The application of this provision to the system of
records could compromise Public Debt's ability to provide useful
information to law enforcement agencies, since revealing sources for
the information could:
(a) Disclose investigative techniques and procedures;
(b) Result in threats or reprisals against informers by the
subjects of an investigation; and
(c) Cause informers to refuse to give full information to
investigators for fear of having their identities as sources disclosed.
In an unrelated change, we are clarifying the privacy interests
afforded to investors upon the death of a securities holder. Public
Debt has protected the privacy interests of securities holders by
regulation long before the passage of the Privacy Act of 1974. We are
amending part 323 to comport with exemption 6 of the Freedom of
Information Act which permits us to withhold all information about
individuals in ``personnel and medical files and similar files'' when
the disclosure of such information ``would constitute a clearly
unwarranted invasion of personal privacy.'' Although the right to
privacy of a deceased securities holder extinguishes upon death, the
exemption protects the deceased person's family-related privacy
interests in certain cases.
The Regulatory Flexibility Act (RFA) requires Federal agencies
either to certify that a proposed rule would not, if adopted in final
form, have a significant impact on a substantial number of small
entities or to prepare an initial regulatory flexibility analysis of
the proposal and publish the analysis for comment (5 U.S.C. 601 et
seq.). This regulation will exempt a new system of records from the
Privacy Act. Because this regulation affects only internal agency
administration, this exemption is not expected to generate any costs.
Therefore, Public Debt and the Department certify that the proposed
rule, if adopted in final form, will not have a significant economic
impact on a substantial number of small entities.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
3501 et seq.), Public Debt and the Department have determined that this
proposed rule would not impose new recordkeeping, application,
reporting, or other types of information collection requirements.
The regulation will not have a substantial direct effect on the
States, on the relationship between the national Government and the
States, or on the distribution of power and responsibilities among the
various levels of government. Therefore, it is determined that this
regulation does not have federalism implications under Executive Order
13132.
In accordance with Executive Order 12866, it has been determined
that this final rule is not a ``significant regulatory
[[Page 36957]]
action'' and, therefore, does not require a Regulatory Impact Analysis.
List of Subjects
31 CFR Part 1
Privacy.
31 CFR Part 323
Freedom of Information, Privacy.
Accordingly, for the reasons stated in the preamble, 31 CFR part 1,
is amended as follows:
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. 552, as amended. Subpart C also issued under 5 U.S.C.
552a.
PART 1--[AMENDED]
Subpart C--Privacy Act
2. In Sec. 1.36 of Subpart C, paragraph (g)(1)(x) is amended by
adding the following new table below the heading BUREAU OF THE PUBLIC
DEBT:
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Number System name
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BPD.009............................ U.S. Treasury Securities Fraud
Information System.
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PART 323--[AMENDED]
3. The authority citation for part 323 continues to read as
follows:
Authority: 80 Stat. 379; sec. 3., 60 Stat. 238, as amended; 5
U.S.C. 301, 552.
4. Revise Sec. 323.2(b) to read as follows:
Sec. 323.2 Rules Governing Availability of Information.
* * * * *
(b) Limitations on the availability of records relating to
securities. Records relating to the purchase, ownership of, and
transactions in Treasury securities or other securities handled by the
Bureau of the Public Debt for government agencies or wholly or
partially Government-owned corporations will ordinarily be disclosed
only to the owners of such securities, their executors, administrators
or other legal representatives or to their survivors or to
investigative and certain other agencies of the Federal and State
governments, to trustees in bankruptcy, receivers of insolvents'
estates or where proper order has been entered requesting disclosure of
information to Federal and State courts. These records are held
confidential because they relate to private financial affairs of the
owners under this Part. In addition, the information falls within the
category of ``personnel and medical files and similar files the
disclosure of which would constitute a clearly unwarranted invasion of
personal privacy'' under the Freedom of Information Act, 5 U.S.C.
552(b)(6). Exemption (b)(6) protects the privacy of living persons and
close survivors of a deceased person identified in a record. Privacy
interests, in the sense of the right to control, use, or disclose
information about oneself, cease at death. However, the exemption
protects the deceased person's family-related privacy interests that
survive death where disclosure would cause embarrassment, pain, grief,
or disrupt the peace of mind, of the surviving family. The Bureau of
the Public Debt will determine whether disclosure of the records is in
the public interest by balancing the surviving family members' privacy
interest against the public's right to know the information.
Dated: June 3, 2003.
W. Earl Wright, Jr.,
Chief Management and Administrative Programs Officer.
[FR Doc. 03-15638 Filed 6-19-03; 8:45 am]
BILLING CODE 4810-39-P