REVISED PRA Supporting Statement Reporting and Procedures-Part 501 from 2009 (2.19.10)

Renewal of OMB Authorization No. 1505-0164
SUPPORTING STATEMENT

This filing contains the information required by the Office of Management and Budget pursuant
to the Paperwork Reduction Act of 1995, 44 U.S.C. 3501-3520, and 5 C.F.R. Part 1320.
A. Justification.
1. Explain the circumstances that make the collection of information necessary. Identify any legal
or administrative requirements that necessitate the collection. Attach a copy of the appropriate
section of each statute and regulation mandating or authorizing the collection of information.
The accompanying OMB 83-I application is submitted to extend the information collection
authority pertaining to the Office of Foreign Assets Control (“OFAC”)’s Reporting, Procedures
and Penalties Regulations set forth in 31 CFR part 501. These regulations are implemented
pursuant to the Trading With the Enemy Act (50 U.S.C. App. 1-44), the International Emergency
Economic Powers Act (50 U.S.C. 1701 - 1706), and the United Nations Participation Act (22
U.S.C. 287c), and other laws. The collections of information relevant to this request are
contained in §§ 501.601 through 501.605, 501.801 and 501.804 through 501.807 and pertain to
the operation of various economic sanctions programs administered by OFAC under 31 CFR
chapter V. Section 501.601 relates to the maintenance of records and § 501.602 relates to OFAC
demands for information relative to any transaction or property subject to the provisions of 31
CFR chapter V. Section 501.603 imposes reporting requirements pertaining to blocked assets and
retained funds transfers. This information is required by OFAC to monitor compliance with
regulatory requirements, to support diplomatic negotiations concerning the targets of sanctions,
and to support settlement negotiations addressing U.S. claims. Section 501.604 requires the filing
of reports for compliance purposes by U.S. financial institutions where a funds transfer is not
required to be blocked but is rejected because the underlying transaction is otherwise prohibited.
Section 501.605 requires reporting of information pertaining to litigation, arbitration, and other
binding alternative dispute resolution proceedings in the United States to prevent the intentional
or inadvertent transfer through such proceedings of blocked property or retained funds. Sections
501.801 and 501.804 through 501.805 relate to license requests; rulemaking; and document
requests. Section 501.806 sets forth the procedures to be followed by a person seeking to have
funds released at a financial institution if the person believes that the funds were blocked due to
mistaken identity. Section 501.807 sets forth the procedures to be followed by persons seeking
administrative reconsideration of their designation or that of a vessel as blocked, or who wish to
assert that the circumstances resulting in the designation are no longer applicable. Copies of §§
501.601 through 501.605, 501.801, and 501.804 through 501.807 are included as Attachment 1.

2. Indicate how, by whom, and for what purpose the information is to be used. Except for a new
collection, indicate the actual use the agency has made of the information received from the
current collection.
The information collected is used by OFAC to implement blocking, licensing, compliance, and
civil penalty, and enforcement programs pursuant to 31 CFR chapter V. OFAC has used

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information reported on blocked and rejected funds transfers to enhance compliance with U.S.
sanctions and as a basis for assisting U.S. Government dealings with other countries. Information
submitted in applications for specific licenses is used by OFAC to determine whether to authorize
particular transactions that would otherwise be prohibited under 31 CFR chapter V. It would be
impossible to authorize such exceptions without requiring those parties requesting them to submit
the basic facts supporting their requests. Without the ability to make such exceptions from the
broad prohibitions contained in 31 CFR chapter V, OFAC would not be able to exercise
reasonable discretion in administering economic sanctions programs.
3. Describe whether, and to what extent, the collection of information involves the use of
automated, electronic, mechanical, or other technological collection techniques or other forms of
information technology, e.g. permitting electronic submission of responses, and the basis for the
decision for adopting this means of collection. Also describe any consideration of using
information technology to reduce burden.
The information is generally reported to OFAC by letter. For example, requests with respect to
general and specific licenses are received from the public in letter form. Information collected
from U.S. financial institutions, however, is collected increasingly by automated, electronic, and
computerized means. Annual reports required under §501.603(b)(2) are submitted via form TDF
90-22.50.
4. Describe efforts to identify duplication. Show specifically why any similar information already
available cannot be used or modified for use for the purposes described in item 2. above.
Generally, the information that OFAC requires pertains to individual transactions and is not
available other than through a specific report. Each individual report of information provided is
of a limited nature, separate, and unique. Thus, there is no duplication of records. Each item is
based upon a new occurrence pertaining to a designated entity or blocked transaction.
U.S. financial institutions, however, are required to make individual reports on assets that they
have blocked within 10 days from the blocking and are also required to report on an annual basis
all blocked property under their control. The annual report is not merely a duplicate of the
information previously reported. Because OFAC periodically issues general licenses allowing the
unblocking of property without a need to make a specific request to OFAC, only through the
annual reporting requirement can OFAC be apprised of the actual status of blocked property.
Current information is required for the purpose of the Department of the Treasury’s
congressionally mandated annual report on terrorist assets as well as for U.S. foreign policy
purposes concerning negotiations with impacted countries.
5. If the collection of information impacts small businesses or other small entities (Item 5 of OMB
Form 83-I), describe any methods used to minimize burden.
The information collection may affect a limited number of small businesses or other small entities
that hold blocked assets or engage in transactions prohibited, unless otherwise authorized, by the
individual parts in 31 CFR chapter V. In the licensing area, the application procedures are
simple, and the average time required to complete a license application is two hours. The
recordkeeping requirement imposed by § 501.601 is minimal, because the records required to be

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maintained should already be maintained under standard business practices.
6. Describe the consequence to Federal program or policy activities if the collection is not
conducted or is conducted less frequently, as well as any technical or legal obstacles to reducing
burden.
The information collected is used primarily by the Treasury Department for licensing,
compliance, and civil penalty and enforcement purposes. This information is used to authorize
transactions consistent with policy, and to prevent the transfer through U.S. financial institutions
of funds in support of target governments and persons. Without these collections of information,
the President's Executive orders cannot be carried out.
Generally, the information could not be collected less frequently unless it was not collected at all.
For example, the need for information required to request a specific license arises only at the time
an applicant determines such a license is necessary. Persons availing themselves of certain
general licenses may be required to file reports and statements in accordance with the instructions
specified in those licenses. With regard to the individual and annual reports on the blocking of
property, if the information were not collected or were collected less frequently, OFAC would
have no means of tracking the compliance of U.S. financial institutions and their customers with
U.S. economic sanctions.
7. Explain any special circumstances that require the collection to be conducted in a manner:
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requiring respondents to report information to the agency more often than quarterly;
Respondents are required to report information on a transaction-by-transaction basis and
on an annual basis. Prompt reporting of individual blockings and rejected transfers is
necessary for OFAC to maintain effective compliance and enforcement.

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requiring respondents to prepare a written response to a collection of information in
fewer than 30 days after receipt of it;
OFAC requires that reports on blocked or rejected transactions be submitted within 10
days of the blocking or rejection. A 30-day requirement would be insufficient for the
foreign policy purposes underlying the economic sanctions. In addition, because OFAC
frequently receives requests to unblock property shortly after it has been blocked, it is
essential for the blockings to be reported to OFAC as soon as possible. OFAC requests
for information in the enforcement context may require a response in less than 30 days
when the information requested is needed immediately for OFAC to adequately enforce
U.S. economic sanctions.

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requiring respondents to submit more than an original and two copies of any document;
No such requirement exists.

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requiring respondents to retain records, other than health, medical, government contract,
grant-in-aid, or tax records, for more than three years;
Part 501 requires respondents to retain records for five years from the date of a restricted
transaction or from the date that blocked property is unblocked. Under § 501.601, the
requirement for five years of record retention beyond a transaction corresponds to the

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statute of limitations set forth in 28 U.S.C. 2462.
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in connection with a statistical survey, that is not designed to produce valid and reliable
results that can be generalized to the universe of study;
The information collections are not part of a statistical survey.

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requiring the use of a statistical data classification that has not been reviewed and
approved by OMB;
Not Applicable.

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that includes a pledge of confidentiality that is not supported by authority established in
statute or regulation, that is not supported by disclosure and data security policies that
are consistent with the pledge, or which unnecessarily impedes sharing of data with other
agencies for compatible confidential use;
No assurances of confidentiality are given other than with respect to reports of blocked
property, as indicated in OFAC’s regulations. It is the policy of OFAC to protect the
confidentiality of information in appropriate cases pursuant to the exemptions from
disclosure provided under the Freedom of Information Act and the Privacy Act.

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requiring respondents to submit proprietary trade secrets, or other confidential
information unless the agency can demonstrate that it has instituted procedures to protect
the information’s confidentiality to the extent permitted by law.
Reports of blocked property are received on a confidential basis. It is the policy of OFAC
to protect the confidentiality of information in appropriate cases pursuant to the
exemptions from disclosure provided under the Freedom of Information Act and the
Privacy Act.

8. If applicable, provide a copy and identify the date and page number of publication in the
Federal Register of the agency’s notice, required by 5 CFR 1320.8(d), soliciting comments on the
information collection prior to submission to OMB. Summarize public comments received in
response to that notice and describe actions taken by the agency in response to these comments.
Specifically address comments received on cost and hour burden.
A copy of the Federal Register Notice of May 22, 2009, 74 FR 24074, soliciting comments is
included as Attachment 2. OFAC received no comments.
Describe efforts to consult with persons outside the agency to obtain their views on the
availability of data, frequency of collection, the clarity of instructions and record keeping,
disclosure, or reporting format (if any), and on the data elements to be recorded, disclosed, or
reported.
We solicited comments through the Federal Register notice referenced above and received no
response. In addition, OFAC has substantial contact with various individuals and groups seeking
to comply with OFAC’s regulations. Through these contacts OFAC is able to develop an
appreciation of the impact of the information collections necessitated by economic sanctions.
OFAC's Licensing Division is in daily contact with applicants for specific licenses under the
various programs it administers. Licensing officers routinely discuss the information required to

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process comparable applications with applicants. Since the procedures are informal,
arrangements to minimize the burden to applicants, while allowing OFAC to make sound
decisions, are constantly being negotiated. In addition, the Compliance Division, which
possesses substantial expertise in the area of banking and financial transactions, maintains similar
contacts with financial institutions. Over thirty years of such daily contacts have streamlined
procedures and assisted OFAC in obtaining a detailed understanding of the burdens its procedures
impose on applicants.
Consultation with representatives of those from whom information is to be obtained or those who
must compile records should occur at least once every 3 years - even if the collection of
information activity is the same as in prior periods. There may be circumstances that mitigate
against consultation in a specific situation. These circumstances should be explained.
Not applicable.
9. Explain any decision to provide any payment or gift to respondents, other than remuneration of
contractors or grantees.
Respondents receive no payment or gifts for providing information to OFAC.
10. Describe any assurance of confidentiality provided to respondents and the basis for the
assurance in statute, regulation, or agency policy.
No assurances of confidentiality are given to persons who furnish information to OFAC unless
specifically indicated in advance. Reports of blocked property are received on a confidential
basis pursuant to OFAC’s regulations. It is the policy of OFAC to protect the confidentiality of
information in appropriate cases pursuant to the exemptions from disclosure provided under the
Freedom of Information Act and the Privacy Act.
11. Provide additional justification for any questions of a sensitive nature, such as sexual
behavior and attitudes, religious beliefs, and other matters that are commonly considered private.
This justification should include the reasons why the agency considers the questions necessary,
the specific uses to be made of the information, the explanation to be given to persons from whom
the information is requested, and any steps to be taken to obtain their consent.
OFAC makes no requests for sensitive information of the type described above.
12. Provide estimates of the hour burden of the collection of information. The statement should:

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Indicate the number of respondents, frequency of response, annual hour burden, and an
explanation of how the burden was estimated. Unless directed to do so, agencies should
not conduct special surveys to obtain information on which to base hour burden estimates.
Consultation with a sample (fewer than 10) of potential respondents is desirable. If the
hour burden on respondents is expected to vary widely because of differences in activity,
size, or complexity, show the range of estimated hour burden and explain the reasons for
the variance. Generally, estimates should not include burden hours for customary and
usual business practices.

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The anticipated number of respondents is approximately 13,125. While the vast majority
of these respondents will submit information to OFAC one or two times per year, larger
financial institutions make many more submissions. Roughly 27,000 responses are
expected annually during the coming three years. The total number of burden hours is
anticipated to be 33,750. This estimate is based on time required to provide the
information varying from 30 minutes to 10 hours, depending on individual circumstances,
with an average of 1.25 hours. These estimates stem from past experience in previous and
ongoing programs.
The burden and numbers of respondents and responses stemming from the new forms for
which OFAC is seeking clearance by the Office of Management and Budget is already
accounted for in the burden allocated for this Information Collection Request. Therefore,
there should be no burden increase as a result of these new forms. In order to properly
reflect that no change in burden has occurred, OFAC had to make adjustments to the time
burden and cost burden reflected in the ROCIS entry for Form TD-F-90.22.50. The
ROCIS entry for Form TD-F-90.22.50 is used to capture the remainder of respondents,
responses, time burden and cost burden under OMB Control Number 1505-0164 not
reflected in the ROCIS entries for each of the new forms.

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If the request for approval covers more than one form, provide separate hour burden
estimates for each form and aggregate the hour burdens in Item 13 of OMB Form 83-I.
Most of the information collections under OMB authorization 1505-164 do not involve the
use of forms. For the purposes of the annual reports of financial institutions, Form TDF
90-20.55 is used. Roughly 250 financial institutions use this form on an annual basis,
taking an average of four hours to complete it.

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Provide estimates of annualized cost to respondents for the hour burdens for collections of
information, identifying and using appropriate wage rate categories. The cost of
contracting out or paying outside parties for information collection activities should not
be included here. Instead, this cost should be included in Item 13.
Of the 27,000 estimated responses, a great majority are processed quickly by individuals
acting on their own behalf or by clerk-level administrators in large financial institutions.
OFAC estimates the cost per burden hour of the anticipated 33,750 burden hours to be $10
per hour, for a total cost of $337,500.

13. Provide an estimate of the total annual cost burden to respondents or record-keeper resulting
from the collection of information. (Do not include the cost of any hour burden shown in Items 12
and 14.)

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The cost estimate should be split into two components: (a) a total capital and start-up
cost component (annualized over its expected useful life) and (b) a total operation and
maintenance component. The estimates should take into account costs associated with
generating, maintaining, and disclosing or providing the information. Include
descriptions of methods used to estimate major cost factors including system and

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technology acquisition, expected useful life of capital equipment, the discount rate(s),
and the time period over which costs will be incurred. Capital and start-up costs include,
among other items, preparations for collecting information such as purchasing
computers and software; monitoring, sampling, drilling and testing equipment; and
record storage facilities.
For larger financial institutions, there may be capital, operating, and maintenance costs
associated with products such as interdiction software used to maintain compliance with
U.S. sanctions laws. Nevertheless, any capital or operating costs associated with the
actual collection of information to be submitted to OFAC are assumed to be minimal.

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If cost estimates are expected to vary widely, agencies should present ranges of cost
burdens and explain the reasons for the variance. The cost of purchasing or contracting
out information collection services should be a part of this cost burden estimate. In
developing cost burden estimates, agencies may consult with a sample of respondents
(fewer than 10), utilize the 60-day pre-OMB submission public comment process and use
existing economic or regulatory impact analysis associated with the rulemaking
containing the information collection, as appropriate.
Not applicable.

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Generally, estimates should not include purchases of equipment or services, or portions
thereof, made: (1) prior to October 1, 1995, (2) to achieve regulatory compliance with
requirements not associated with the information collection, (3) for reasons other than to
provide information or keep records for the government, or (4) as part of customary and
usual business or private practices.
Not applicable.

14. Provide estimates of annualized cost to the Federal Government. Also, provide a description
of the method used to estimate cost, which should include quantification of hours, operational
expenses (such as equipment, overhead, printing, and support staff), and any other expense that
would not have been incurred without this collection of information. Agencies may also
aggregate cost estimates from paragraphs 12, 13, and 14 in a single table.
There is no cost to the U.S. Government attributable to this information collection effort that
would not have been incurred without the paperwork burden.
15. Explain the reasons for any program changes or adjustments reported in Items 13 or 14 of
the OMB Form 83-I.
This submission is being made for renewal purposes. The estimated 27,000 annual responses
cited in Item 13(b) represents a 5,750 annual response increase from the 21,250 annual responses
provided for in the change request filed in 2008 for 31 CFR part 501. This change is the result of
an expected increase in the number of annual reports submitted pursuant to § 501.603 based on
trends from the past 3 years and stems from expanded OFAC sanctions programming. The
corresponding increase in total annual hours requested to 33,750 hours, cited in Item 13(c),

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reflects the additional hours expected due to the increase in § 501.603 annual reports.
16. For collections of information whose results will be published, outline plans for tabulation
and publication. Address any complex analytical techniques that will be used. Provide the time
schedule for the entire project, including beginning and ending dates of the collection of
information, completion of report, publication dates, and other actions.
Results will not be published.
17. If seeking approval to not display the expiration date for OMB approval of the information
collection, explain the reasons that display would be inappropriate.
Not applicable.
18. Explain each exception to the certification statement identified in Item 19, "Certification for
Paperwork Reduction Act Submissions," of OMB Form 83-I.
Not applicable.

B. Collections of Information Employing Statistical Methods.
Not applicable.