80 FR 49138 - Program Fraud Civil Remedies

DEPARTMENT OF STATE

Federal Register Volume 80, Issue 158 (August 17, 2015)

The Department of State is updating its regulations regarding its implementation of the Program Fraud Civil Remedies Act of 1986, to remove a conflict between the ``reviewing official'' and the ``authority head'' as defined by the implementing regulations.

[Federal Register Volume 80, Number 158 (Monday, August 17, 2015)]
[Rules and Regulations]
[Pages 49138-49140]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-20263]


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DEPARTMENT OF STATE

22 CFR Part 35

[Public Notice 9220]
RIN 1400-AD85


Program Fraud Civil Remedies

AGENCY: Department of State.

ACTION: Final rule.

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SUMMARY: The Department of State is updating its regulations regarding 
its implementation of the Program Fraud Civil Remedies Act of 1986, to 
remove a conflict between the ``reviewing official'' and the 
``authority head'' as defined by the implementing regulations.

DATES: This rule is effective August 17, 2015.

FOR FURTHER INFORMATION CONTACT: Alice Kottmyer, Attorney-Adviser,

[[Page 49139]]

Office of the Legal Adviser, (202) 647-2318, or [email protected].

SUPPLEMENTARY INFORMATION: The Program Fraud Civil Remedies Act of 
1986, 31 U.S.C. 3801 et seq. (the Act), outlines a procedure for 
establishing administrative procedures for imposing civil penalties and 
assessments against persons who make, submit, or present, or cause to 
be made, submitted, or presented, false fictitious, or fraudulent 
claims or written statements to authorities or to their agents; and 
specifying the hearing and appeal rights of persons subject to 
allegations of liability for such penalties and assessments. In a 
nutshell, the ``investigating official'' (who is in the Office of the 
Inspector General) presents a case to the ``reviewing official'' 
(currently defined as the Chief Financial Officer) who, if appropriate, 
forwards the case to the Department of Justice. The Department of 
Justice will approve a ``claim'' if it believes further action is 
warranted. The reviewing official serves the claim on the respondent. 
There is a hearing before an administrative law judge (ALJ), and a 
disposition adverse to the respondent can be appealed to the 
``authority head,'' defined in the rule as the Under Secretary for 
Management.
    Currently, the Under Secretary for Management is designated by the 
President as the Chief Financial Officer for the Department of State. 
Therefore, he is the reviewing official as well as the authority head, 
which of course is unacceptable. This rule corrects that anomaly, by 
defining the ``reviewing official'' as the Assistant Legal Adviser for 
Buildings and Acquisitions (hereinafter, ``the ALA''). The Under 
Secretary for Management remains the authority head.
    The Act (in 31 U.S.C. 3801(a)(8)) outlines the qualifications for 
the reviewing official, all of which are met by the ALA. (1) He or she 
must be designated by the authority head to make the determination 
under 31 U.S.C. 3803(a)(2) to send the case to the Department of 
Justice for its review and action, if appropriate. (2) He or she must 
be serving in a position for which the rate of basic pay is not less 
than the minimum rate of basic pay for grade GS-16 under the General 
Schedule; the ALA is a member of the Senior Executive Service, and thus 
has a rate of pay at least as high as GS-16, a grade which was 
eliminated under the provisions of the Civil Service Reform Act of 
1978. (3) He or she must not be subject to supervision by, or required 
to report to, the investigating official, and not employed in the 
organizational unit of the authority in which the investigating 
official is employed; the ALA is not in the Office of the Inspector 
General and is not (nor will he or she ever be) subject to the 
supervision of anyone in that office.
    Accordingly, 22 CFR 35.2(r), the definition of ``reviewing 
official,'' is changed by this rulemaking.

Regulatory Findings

Administrative Procedure Act

    This regulation amends a ``rule of agency organization, procedure, 
or practice'', which is not subject to the notice-and-comment 
rulemaking procedures set forth in 5 U.S.C. 553. See 5 U.S.C. 553(b). 
Therefore, the Department is issuing this amendment as a final rule.

Regulatory Flexibility Act/Executive Order 13272: Small Business

    Because this final rule is exempt from notice and comment 
rulemaking under 5 U.S.C. 553, it is exempt from the regulatory 
flexibility analysis requirements set forth by the Regulatory 
Flexibility Act. Nonetheless, consistent with the Regulatory 
Flexibility Act, the Department certifies that this rule will not have 
a significant economic impact on a substantial number of small 
entities.

Unfunded Mandates Reform Act of 1995

    Section 202 of the Unfunded Mandates Reform Act of 1995, 2 U.S.C. 
1532, generally requires agencies to prepare a statement before 
proposing any rule that may result in an annual expenditure of $100 
million or more by State, local, or tribal governments, or by the 
private sector. This rule will not result in any such expenditure, nor 
will it significantly or uniquely affect small governments.

 Small Business Regulatory Enforcement Fairness Act of 1996

    This rule is not a major rule as defined by 5 U.S.C. 804. The 
Department is aware of no monetary effect on the economy that would 
result from this rulemaking, nor will there be any increase in costs or 
prices; or any effect on competition, employment, investment, 
productivity, innovation, or the ability of United States-based 
companies to compete with foreign-based companies in domestic and 
import markets.

Executive Orders 12866 and 13563

    The Department of State has reviewed this rule to ensure its 
consistency with the regulatory philosophy and principles set forth in 
Executive Orders 12866 and 13563, and has determined that the benefits 
of this regulation outweigh any cost. The Department does not consider 
this rule to be a economically significant rulemaking action.

Executive Orders 12372 and 13132: Federalism

    This regulation will not have substantial direct effects on the 
States, on the relationship between the national government and the 
States, or the distribution of power and responsibilities among the 
various levels of government. The rule will not have federalism 
implications warranting the application of Executive Orders 12372 and 
13132.

Executive Order 12988: Civil Justice Reform

    The Department has reviewed the regulation in light of sections 
3(a) and 3(b)(2) of Executive Order 12988 to eliminate ambiguity, 
minimize litigation, establish clear legal standards, and reduce 
burden.

Executive Order 13175

    The Department of State has determined that this rulemaking will 
not have tribal implications, will not impose substantial direct 
compliance costs on Indian tribal governments, and will not preempt 
tribal law. Accordingly, the requirements of Executive Order 13175 do 
not apply to this rulemaking.

Paperwork Reduction Act

    This rule does not impose or revise information collection 
requirements under the provisions of the Paperwork Reduction Act, 44 
U.S.C. Chapter 35.

List of Subjects in 22 CFR Part 35

    Administrative practice and procedure, Claims, Fraud, Penalties.

    For the reasons stated in the preamble, amend part 35 of title 22 
of the Code of Federal Regulations as follows:

PART 35--PROGRAM FRAUD CIVIL REMEDIES

0
1. The authority citation for part 35 is revised to read as follows:

    Authority:  22 U.S.C. 2651a; 31 U.S.C. 3801 et seq.


0
2. Revise Sec.  35.2(r) to read as follows:


Sec.  35.2  Definitions.

* * * * *
    (r) Reviewing official means the Assistant Legal Adviser for 
Buildings and Acquisitions or her or his designee who is--

[[Page 49140]]

    (1) Not subject to supervision by, or required to report to, the 
investigating official;
    (2) Not employed in the organizational unit of the authority in 
which the investigating official is employed; and
    (3) Serving in a position for which the rate of basic pay is not 
less than the minimum rate of basic pay for grade GS-16 under the 
General Schedule.
* * * * *

    Dated: August 3, 2015.
Patrick F. Kennedy,
Under Secretary of State for Management, Department of State.
[FR Doc. 2015-20263 Filed 8-14-15; 8:45 am]
 BILLING CODE 4710-08-P