60 Day FRN

22118

Federal Register / Vol. 82, No. 91 / Friday, May 12, 2017 / Notices

COMMODITY FUTURES TRADING
COMMISSION
Agency Information Collection
Activities: Notice of Intent To Renew
Collection Number 3038–0075,
Protection of Collateral of
Counterparties to Uncleared Swaps;
Treatment of Securities in a Portfolio
Margining Account in a Commodity
Broker Bankruptcy
Commodity Futures Trading
Commission.
ACTION: Notice.
AGENCY:

The Commodity Futures
Trading Commission (‘‘CFTC’’ or
‘‘Commission’’) is announcing an
opportunity for public comment on the
proposed renewal of a collection of
certain information by the agency.
Under the Paperwork Reduction Act
(‘‘PRA’’), Federal agencies are required
to publish notice in the Federal Register
concerning each proposed collection of
information, including each proposed
extension of an existing collection of
information, and to allow 60 days for
public comment. This notice solicits
comments on the collections of
information mandated by requirements
that swap dealers (‘‘SDs’’) and major
swap participants (‘‘MSPs’’) with
respect to the treatment of collateral by
their counterparties to margin,
guarantee, or secure uncleared swaps.
DATES: Comments must be submitted on
or before July 11, 2017.
ADDRESSES: You may submit comments,
identified by ‘‘Protection of Collateral of
Counterparties to Uncleared Swaps;
Treatment of Securities in a Portfolio
Margining Account in a Commodity
Broker Bankruptcy,’’ and OMB Control
No. 3038–0075 by any of the following
methods:
• The Agency’s Web site, at http://
comments.cftc.gov/. Follow the
instructions for submitting comments
through the Web site.
• Mail: Christopher Kirkpatrick,
Secretary of the Commission,
Commodity Futures Trading
Commission, Three Lafayette Centre,
1155 21st Street NW., Washington, DC
20581.
• Hand Delivery/Courier: Same as
Mail above.
• Federal eRulemaking Portal: http://
www.regulations.gov/. Follow the
instructions for submitting comments
through the Portal.
Please submit your comments using
only one method.
FOR FURTHER INFORMATION CONTACT:
Gregory Scopino, Special Counsel,
Division of Swap Dealer and
Intermediary Oversight, Commodity

mstockstill on DSK30JT082PROD with NOTICES

SUMMARY:

VerDate Sep<11>2014

17:41 May 11, 2017

Jkt 241001

Futures Trading Commission, (202)
418–5175, email: [email protected].
SUPPLEMENTARY INFORMATION: Under the
PRA,1 Federal agencies must obtain
approval from the Office of Management
and Budget (‘‘OMB’’) for each collection
of information they conduct or sponsor.
‘‘Collection of Information’’ is defined
in 44 U.S.C. 3502(3) and 5 CFR 1320.3
and includes agency requests or
requirements that members of the public
submit reports, keep records, or provide
information to a third party. Section
3506(c)(2)(A) of the PRA, 44 U.S.C.
3506(c)(2)(A), requires Federal agencies
to provide a 60-day notice in the
Federal Register concerning each
proposed collection of information,
including each proposed extension of an
existing collection of information,
before submitting the collection to OMB
for approval. To comply with this
requirement, the CFTC is publishing
notice of the proposed collection of
information listed below. An agency
may not conduct or sponsor, and a
person is not required to respond to, a
collection of information unless it
displays a currently valid OMB control
number.
Title: Protection of Collateral of
Counterparties to Uncleared Swaps;
Treatment of Securities in a Portfolio
Margining Account in a Commodity
Broker Bankruptcy (OMB Control No.
3038–0075). This is a request for an
extension of a currently approved
information collection.
Abstract: On November 6, 2013, the
Commission issued final rules
implementing statutory provisions
pursuant to Title VII of the Dodd-Frank
Wall Street Reform and Consumer
Protection Act (‘‘Dodd-Frank Act’’) and
imposing requirements on SDs and
MSPs with respect to the treatment of
collateral posted by their counterparties
to margin, guarantee, or secure
uncleared swaps.2 Additionally, the
final rule includes revisions to ensure
that, for purposes of subchapter IV of
chapter 7 of the Bankruptcy Code,
securities held in a portfolio margining
account that is a futures account or a
Cleared Swaps Customer Account
constitute ‘‘customer property’’; and
owners of such accounts constitute
‘‘customers.’’ 3 Section 4s(l) of the CEA
sets forth certain requirements
concerning the rights of counterparties
of SDs and MSPs with respect to the
segregation of money, securities, or
other property used to margin,
guarantee, or otherwise secure
uncleared swaps. Regulation 23.701
1 44
2 78

U.S.C. 3501 et seq.
FR 66621.

3 Id.

PO 00000

Frm 00022

Fmt 4703

Sfmt 4703

implements part of the new statutory
requirements by specifying that certain
information must be provided to
counterparties about the terms and
conditions of segregation, including
price information, to the extent that the
SD or MSP has such information, and
the identity of one or more independent
depositories for segregated collateral.
Regulation 23.704 implements the
requirements of CEA Section 4s(l)(4),
which dictates that, in certain
circumstances, an SD or MSP must
report to the counterparty, on a
quarterly basis, ‘‘that the back office
procedures of the swap dealer or major
swap participant relating to margin and
collateral requirements are in
compliance with the agreement of the
counterparties.’’
As discussed above, the rules
establish reporting andrecordkeeping
requirements that are mandated by
Section 4s(l) of the CEA, which states
that SDs and MSPs must notify their
counterparties of the right to have their
initial margin segregated and to
maintain the confirmations and
elections related to such notices as
business records. The reporting and
recordkeeping requirements are
necessary to implement the objectives of
Section 4s(1). For example, the
information received by uncleared swap
counterparties pursuant to Regulation
23.701 would alert counterparties to
their statutory right, if they so choose,
to have funds or property used as
margin in uncleared swaps transactions
with SDs and MSPs kept segregated
from the property of the SD or MSP.
Likewise, the information provided
would further alert counterparties of the
need to request such segregation if they
wish to exercise this right. Simlarly, the
information received by uncleared swap
counterparties pursuant to Regulation
23.704 would be used to confirm that
the back office procedures followed by
a SD or MSP with whom they are
dealing comply with the agreement of
the parties.
With respect to the collection of
information, the CFTC invites
comments on:
• Whether the proposed collection of
information is necessary for the proper
performance of the functions of the
Commission, including whether the
information will have a practical use;
• The accuracy of the Commission’s
estimate of the burden of the proposed
collection of information, including the
validity of the methodology and
assumptions used;
• Ways to enhance the quality,
usefulness, and clarity of the
information to be collected; and

E:\FR\FM\12MYN1.SGM

12MYN1

Federal Register / Vol. 82, No. 91 / Friday, May 12, 2017 / Notices
• Ways to minimize the burden of
collection of information on those who
are to respond, including through the
use of appropriate automated electronic,
mechanical, or other technological
collection techniques or other forms of
information technology; e.g., permitting
electronic submission of responses.
All comments must be submitted in
English, or if not, accompanied by an
English translation. Comments will be
posted as received to http://
www.cftc.gov. You should submit only
information that you wish to make
available publicly. If you wish the
Commission to consider information
that you believe is exempt from
disclosure under the Freedom of
Information Act, a petition for
confidential treatment of the exempt
information may be submitted according
to the procedures established in § 145.9
of the Commission’s regulations.4
The Commission reserves the right,
but shall have no obligation, to review,
pre-screen, filter, redact, refuse or
remove any or all of your submission
from http://www.cftc.gov that it may
deem to be inappropriate for
publication, such as obscene language.
All submissions that have been redacted
or removed that contain comments on
the merits of the information collection
request will be retained in the public
comment file and will be considered as
required under the Administrative
Procedure Act and other applicable
laws, and may be accessible under the
Freedom of Information Act.
Burden Statement: The Commission
is revising its estimate of the burden for
this collection to reflect the current
number of registered SDs and MSPs.
Accordingly, the respondent burden for
this collection is estimated to be as
follows:
Number of Registrants: 102.
Estimated Average Burden Hours per
Registrant: 3,406.
Estimated Aggregate Burden Hours:
347,412.
Frequency of Reporting: As
applicable.

mstockstill on DSK30JT082PROD with NOTICES

Authority: 44 U.S.C. 3501 et seq.
Dated: May 9, 2017.
Robert N. Sidman,
Deputy Secretary of the Commission.
[FR Doc. 2017–09686 Filed 5–11–17; 8:45 am]
BILLING CODE 6351–01–P

4 17

CFR 145.9.

VerDate Sep<11>2014

17:41 May 11, 2017

Jkt 241001

BUREAU OF CONSUMER FINANCIAL
PROTECTION
Supervisory Highlights: Spring 2017
Bureau of Consumer Financial
Protection.
ACTION: Supervisory Highlights; notice.
AGENCY:

The Bureau of Consumer
Financial Protection (Bureau or CFPB) is
issuing its fifteenth edition of its
Supervisory Highlights. In this issue of
Supervisory Highlights, we report
examination findings in the areas of
mortgage servicing, student loan
servicing, mortgage origination, and fair
lending. As in past editions, this report
includes information about a recent
public enforcement action that was a
result, at least in part, of our supervisory
work. The report also includes
information on recently released
examination procedures and Bureau
guidance.
DATES: The Bureau released this edition
of the Supervisory Highlights on its Web
site on April 26, 2017.
FOR FURTHER INFORMATION CONTACT:
Adetola Adenuga, Consumer Financial
Protection Analyst, Office of
Supervision Policy, 1700 G Street NW.,
20552, (202) 435–9373.
SUPPLEMENTARY INFORMATION:
SUMMARY:

1. Introduction
The Consumer Financial Protection
Bureau is committed to a consumer
financial marketplace that is fair,
transparent, and competitive, and that
works for all consumers. The Bureau
supervises both bank and nonbank
institutions to help meet this goal. In
this fifteenth edition of Supervisory
Highlights, the CFPB shares recent
supervisory observations in the areas of
mortgage servicing, student loan
servicing, mortgage origination, and fair
lending. In particular, we describe key
new developments around spike and
trend monitoring, service provider
examinations, and production
incentives. The findings reported here
reflect information obtained from
supervisory activities that were
generally completed between September
2016 and December 2016 (unless
otherwise stated). Corrective actions
regarding certain matters may remain in
process at the time of this report’s
publication.
CFPB supervisory reviews and
examinations typically involve
assessing a supervised entity’s
compliance management system and
compliance with Federal consumer
financial laws. When Supervision
examinations determine that a
supervised entity has violated a statute

PO 00000

Frm 00023

Fmt 4703

Sfmt 4703

22119

or regulation, Supervision directs the
entity to implement appropriate
corrective measures, such as
implementing new policies, changing
written communications, improving
training or monitoring, or otherwise
changing conduct to ensure the illegal
practices cease. Supervision also directs
the entity to send consumers refunds,
pay restitution, credit borrower
accounts, or take other remedial actions.
Recent supervisory resolutions have
resulted in total restitution payments of
approximately $6.1 million to more than
16,000 consumers during the review
period. Additionally, CFPB’s recent
supervisory activities have either led to
or supported five recent public
enforcement actions, resulting in over
$39 million in consumer remediation
and an additional $19 million in civil
money penalties.
Please submit any questions or
comments to CFPB_Supervision@
cfpb.gov.
2. Supervisory Observations
Recent supervisory observations are
reported in the areas of mortgage
origination, mortgage servicing, student
loan servicing, and fair lending.
2.1

Mortgage Origination

2.1.1 Observations and Approach to
Compliance With the Ability To Repay
(ATR) Rule Requirements
Prior to the mortgage crisis, some
creditors offered consumers mortgages
without considering the consumer’s
ability to repay the loan, at times
engaging in the loose underwriting
practice of failing to verify the
consumer’s debts or income. The DoddFrank Wall Street Reform and Consumer
Protection Act (Dodd-Frank Act)
amended the Truth in Lending Act
(TILA) to provide that no creditor may
make a residential mortgage loan unless
the creditor makes a reasonable and
good faith determination based on
verified and documented information
that, at the time the loan is
consummated, the consumer has a
reasonable ability to repay the loan
according to its terms, as well as all
applicable taxes, insurance (including
mortgage guarantee insurance), and
assessments.1 The Dodd-Frank Act also
amended TILA by creating a
presumption of compliance with these
ability-to-repay (ATR) requirements for
creditors originating a specific category
1 Section 1411 of the Dodd-Frank Act, Public Law
111–203, adding section 129C(a) to TILA, codified
at 15 U.S.C. 1639c(a)).

E:\FR\FM\12MYN1.SGM

12MYN1