81 FR 81140 - Agency Information Collection Activities; Proposed Collection; Comment Request

FEDERAL TRADE COMMISSION

Federal Register Volume 81, Issue 222 (November 17, 2016)

Page Range		81140-81143
FR Document		2016-27701

The information collection requirements described below will be submitted to the Office of Management and Budget (OMB) for review, as required by the Paperwork Reduction Act (PRA). The FTC seeks public comments on its proposal to extend, for three years, the current PRA clearance for its portion of the information collection requirements contained in the Consumer Financial Protection Bureau's Regulation O (the Mortgage Assistance Relief Services Rule). The FTC shares enforcement of Regulation O with the Consumer Financial Protection Bureau (CFPB). This clearance expires on January 31, 2017.

Federal Register, Volume 81 Issue 222 (Thursday, November 17, 2016)

[Federal Register Volume 81, Number 222 (Thursday, November 17, 2016)]
[Notices]
[Pages 81140-81143]
From the Federal Register Online [www.thefederalregister.org]
[FR Doc No: 2016-27701]

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FEDERAL TRADE COMMISSION

Agency Information Collection Activities; Proposed Collection;
Comment Request

AGENCY: Federal Trade Commission (FTC or Commission).

ACTION: Notice.

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SUMMARY: The information collection requirements described below will
be submitted to the Office of Management and Budget (OMB) for review,
as required by the Paperwork Reduction Act (PRA). The FTC seeks public
comments on its proposal to extend, for three years, the current PRA
clearance for its portion of the information collection requirements
contained in the Consumer Financial Protection Bureau's Regulation O
(the Mortgage Assistance Relief Services Rule). The FTC shares
enforcement of Regulation O with the Consumer Financial Protection
Bureau (CFPB). This clearance expires on January 31, 2017.

DATES: Comments must be received on or before January 17, 2017.

ADDRESSES: Interested parties may file a comment online or on paper by
following the instructions in the Request for Comments part of the
Supplementary Information section below. Write ``Regulation O, PRA
Comment, FTC File No. P134812'' on your comment, and file your comment
online at https://ftcpublic.commentworks.com/ftc/regulationopra by
following the instructions on the web-based form. If you prefer to file
your comment on paper, mail or deliver your comment to the following
address: Federal Trade Commission, Office of the Secretary, 600
Pennsylvania Avenue NW., Suite CC-5610 (Annex J), Washington, DC 20580,
or deliver your comment to the following address: Federal Trade
Commission, Office of the Secretary, Constitution Center, 400 7th
Street SW., 5th Floor, Suite 5610 (Annex J), Washington, DC 20024.

FOR FURTHER INFORMATION CONTACT: Requests for copies of the collection
of information and supporting documentation should be addressed to
Rebecca Unruh, Attorney, Division of Financial Practices, Bureau of
Consumer Protection, Federal Trade Commission, 600 Pennsylvania Avenue
NW., CC-10232, Washington, DC 20580, (202) 326-3365.

SUPPLEMENTARY INFORMATION: Title X of the Dodd-Frank Wall Street Reform
and Consumer Protection Act (``Dodd-Frank Act''), Public Law 111-203,
124 Stat. 1376 (2010), transferred the Commission's rulemaking
authority under the mortgage provisions in section 626 of the 2009
Omnibus Appropriations Act, as amended,\1\ to the CFPB.\2\ On December
16, 2011, the CFPB republished the Mortgage Assistance Relief Services
(``MARS'') Rule as Regulation O (12 CFR part 1015).\3\ As a result, the
Commission subsequently rescinded its MARS Rule (16 CFR part 322).\4\
Nonetheless, under the Dodd-Frank Act, the FTC retains its

[[Page 81141]]

authority to bring law enforcement actions to enforce Regulation O.\5\
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\1\ Public Law 111-8, section 626, 123 Stat. 524 (Mar. 11,
2009).
\2\ Dodd-Frank Act, Sec. 1061, 12 U.S.C. 5581 (2010).
\3\ 76 FR 78130.
\4\ 77 FR 22200 (April 13, 2012).
\5\ Dodd-Frank Act, Sec. 1061(b)(5), 12 U.S.C. 5581(b)(5).
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Regulation O contains information requirements that have been
approved by OMB under the PRA, 44 U.S.C. 3501 et seq. The discussion
below details the nature of and justification for the information
collection requirements of Regulation O for which the FTC, as a co-
enforcer, seeks OMB clearance renewal for its share of the estimated
PRA burden.\6\
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\6\ The OMB Control Number for the FTC's existing PRA clearance
associated with Regulation O is 3084-0157.
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Disclosure Requirements

In commercial communications for a general audience, MARS providers
are required to make the following disclosure:
(1) ``(Name of company) is not associated with the government and
our service is not approved by the government or your lender''; and
(2) In some instances, that ``[e]ven if you accept this offer and
use our service, your lender may not agree to change your loan.''
In addition, MARS providers must disclose to consumers, in any
subsequent commercial communication directed to a specific consumer,
the following information:
(1) That ``You may stop doing business with us at any time. You may
accept or reject the offer of mortgage assistance we obtain from your
lender [or servicer]. If you reject the offer, you do not have to pay
us. If you accept the offer, you will have to pay us (insert amount or
method for calculating the amount) for our services'';
(2) That ``(Name of company) is not associated with the government
and our service is not approved by the government or your lender''; and
(3) In some instances, that ``[e]ven if you accept this offer and
use our service, your lender may not agree to change your loan.''
Furthermore, MARS providers are required to disclose to consumers
in all communications in which the provider represents that the
consumer should temporarily or permanently discontinue payments, in
whole or in part, the following information:
``If you stop paying your mortgage, you could lose your home and
damage your credit rating.''
Finally, after a provider has obtained an offer of mortgage
assistance relief from the lender or servicer and presented the
consumer with a written agreement incorporating the offer, the MARS
provider must disclose the following:
(1) ``This is an offer of mortgage assistance relief service from
your lender [or servicer]. You may accept or reject the offer. If you
accept the offer, you will have to pay us [same amount as disclosed
pursuant to Sec. 1015.4(b)(1)] for our services''; and
(2) A description of all ``material differences'' between the
terms, conditions, and limitations of the consumer's current mortgage
and those associated with the offer for mortgage relief, provided in a
written notice from the consumer's lender or servicer.
Regulation O also requires that the disclosures be ``clear and
prominent,'' as defined specific to the media used.\7\
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\7\ See 12 CFR 1015.2, 1015.5.
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These disclosures are necessary for the following reasons:
Non-affiliation with the government or lenders: Federal
and state law enforcement officials have brought numerous law
enforcement actions against MARS providers who have misrepresented
their affiliation with government agencies or programs, lenders, or
servicers, in connection with offering MARS. These providers have used
a variety of techniques to create such misimpressions, including
advertising under trade names that resemble the names of legitimate
government programs. Given that the government, for-profit entities,
and nonprofit entities assist financially distressed consumers with
their mortgages, and the frequency of deceptive affiliation claims, the
requirement that MARS providers disclose their nonaffiliation with the
government or with consumers' lenders or servicers is reasonably
related to the goal of preventing deception.
Risk of Nonpayment of Mortgage: Law enforcement experience
and the FTC's rulemaking record for the former MARS Rule demonstrates
that MARS providers frequently encourage consumers, often through
deception, to stop paying their mortgages and instead pay providers.
Consumers who rely on these deceptive statements frequently suffer
grave financial harm. Requiring MARS providers who encourage consumers
not to pay their mortgages to disclose the risks of following this
advice is necessary to prevent deception.
Total amount a consumer must pay: The total cost of MARS
is perhaps most material to consumers in making well-informed decisions
about whether to purchase those services. Requiring the clear and
prominent disclosure of total cost information in every communication
directed at a specific consumer before the consumer enters into an
agreement would decrease the likelihood that MARS providers will
deceive prospective customers with incomplete, inaccurate, or confusing
cost information. Requiring MARS providers to disclose total cost
information clearly and prominently is reasonably related to the
prevention of deception.
Right to accept or reject offer of mortgage assistance: To
effectuate fully the advance fee ban under 12 CFR 1015.5, which
prohibits providers from collecting fees until the consumer has
accepted the results obtained by the provider, it also is necessary for
a MARS provider to inform consumers that they may withdraw from the
service and may accept or reject the result delivered by the provider.
This disclosure is reasonably related to preventing unfair and
deceptive acts and practices by MARS providers.
No guarantee: Law enforcement experience and the FTC's
rulemaking record reveals that MARS providers often misrepresent their
likelihood of success in obtaining a significant loan modification for
consumers. These deceptive success claims lead consumers to
overestimate MARS providers' abilities to obtain substantial loan
modifications or other relief. Requiring MARS providers to inform
consumers that lenders might not agree to change consumers' loans, even
if those consumers purchase the services that the MARS provider offers,
is reasonably related to the goal of preventing deception.
Written Notice from Lender or Servicer: Based on law
enforcement experience and the rulemaking record, providing the
consumer with a notice from the consumer's lender or servicer
describing all material differences between the consumer's current
mortgage loan and the offered mortgage relief is essential to
consumers' ability to evaluate whether they should accept the offer.
Requiring that the lender or servicer prepare the written disclosure
also better ensures that the information provided is consistent with
the terms of the offer, and mitigates the risk that MARS providers
would mislead consumers about the offer. This disclosure is reasonably
related to the goal of protecting consumers from deception.

Recordkeeping Requirements

Regulation O's recordkeeping requirements pertain to records that
are customarily kept in the ordinary course of business, such as copies
of contracts and consumer files containing the name

[[Page 81142]]

and address of the borrower and materially different versions of sales
scripts and related promotional materials. Thus, the retention of these
documents does not constitute a ``collection of information,'' as
defined by OMB's regulations that implement the PRA.\8\
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\8\ 5 CFR 1320.3(b)(2).
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Burden Statement

Because the FTC and CFPB share enforcement authority for this rule,
the FTC is seeking clearance for one-half of the following estimated
PRA burden that the FTC attributes to the disclosure and recordkeeping
requirements under Regulation O. The potential entities providing MARS
services are varied, and there are no ways to formally track them. By
extension, there is no clear path to track how many affected individual
entities have newly entered and departed from one year to the next or
from one triennial PRA clearance cycle to the next. However, based on
law enforcement experience and the CFPB's recent analysis conducted
after the MARS Rule was restated as Regulation O, the FTC estimates
that Regulation O affects roughly 107 MARS providers.\9\ This estimate
informs the additional estimates detailed below.
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\9\ See Bureau of Consumer Financial Protection, Agency
Information Collection Activities: Submission for OMB Review;
Supporting Statement (Jul. 23, 2015), available at http://www.reginfo.gov/public/do/PRAViewDocument?ref_nbr=201507-3170-002;
OMB Control No: 3170-0007, clearance expires on Sept. 30, 2018.
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Estimated annual hours burden: 321 (for the FTC).
The above hours estimate is based on the assumption that compliance
with all MARS disclosures requires 6 hours of labor annually.\10\
Multiplying this figure by 107 entities yields a total burden of 642
hours, of which 321 hours are attributed to the FTC.\11\
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\10\ Id.
\11\ Id. Both the FTC and CFPB attribute the significant drop in
burden hours from prior estimates to several factors, including the
lack of one-time startup costs associated with new entrants into the
market (since there are not expected to be any new market entrants
in the next three years), the lack of rule modification, and a
reduction in the estimated number of MARS providers. The decrease in
the estimated number of MARS providers is consistent with Regulation
O's causing a reduction in purported providers of mortgage relief
services who were not in fact providing legitimate relief services,
causing overestimation.
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Estimated associated labor cost: $10,677 (for the FTC).
Commission staff assumes that a compliance officer or equivalent
will prepare the required disclosures for 6 hours annually at an hourly
rate of $33.26.\12\ Thus, the estimated labor cost is $21,353 (107
providers x 6 hours x $33.26) of which the FTC assumes half, or
$10,677.
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\12\ This estimate is based on the mean hourly wage for a
Compliance Officer provided by the Bureau of Labor Statistics in its
Table entitled ``National employment and wage data from the
Occupational Employment Statistics survey by occupation, May 2015.''
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Estimated non-labor cost: $29,425 (for the FTC).
Based on the CFPB's analysis, the FTC assumes that each of the
estimated 107 MARS providers bears an additional $550 in material fees
for acquiring relevant legal and technical compliance information, for
a total additional burden of $58,850, of which the FTC assumes half, or
$29,425.\13\ Based on law enforcement experience, the FTC assumes that
any disclosures will likely be made electronically and thus will not
generate additional non-labor costs such as printing and distribution.
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\13\ See supra note 9.
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Request for Comments

Under the PRA, 44 U.S.C. 3501-3521, federal agencies must obtain
approval from OMB for each collection of information they conduct or
sponsor. ``Collection of information'' means agency requests or
requirements that members of the public submit reports, keep records,
or provide information to a third party. 44 U.S.C. 3502(3); 5 CFR
1320.3(c). As required by section 3506(c)(2)(A) of the PRA, the FTC is
providing this opportunity for public comment before requesting that
OMB extend the existing paperwork clearance for the regulations noted
herein.
Pursuant to Section 3506(c)(2)(A) of the PRA, the FTC invites
comments on:
(1) Whether the disclosure and recordkeeping requirements are
necessary, including whether the information will be practically
useful;
(2) the accuracy of our burden estimates, including whether the
methodology and assumptions used are valid;
(3) ways to enhance the quality, utility, and clarity of the
information to be collected; and
(4) ways to minimize the burden of the collection of information.
All comments should be filed as prescribed in the ADDRESSES section
above, and must be received on or before January 17, 2017.
You can file a comment online or on paper. Write ``Regulation O,
PRA Comment, FTC File No. P134812'' on your comment. Your comment--
including your name and your state--will be placed on the public record
of this proceeding, including, to the extent practicable, on the public
Commission Web site, at http://www.ftc.gov/os/publiccomments.shtm. As a
matter of discretion, the Commission tries to remove individuals' home
contact information from comments before placing them on the Commission
Web site.
Because your comment will be made public, you are solely
responsible for making sure that your comment does not include any
sensitive personal information, such as a Social Security number, date
of birth, driver's license number or other state identification number
or foreign country equivalent, passport number, financial account
number, or credit or debit card number. You are also solely responsible
for making sure that your comment does not include any sensitive health
information, such as medical records or other individually identifiable
health information. In addition, do not include any ``[t]rade secret or
any commercial or financial information which is . . . privileged or
confidential,'' as discussed in section 6(f) of the FTC Act, 15 U.S.C.
46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2). In particular, do
not include competitively sensitive information such as costs, sales
statistics, inventories, formulas, patterns, devices, manufacturing
processes, or customer names.
If you want the Commission to give your comment confidential
treatment, you must file it in paper form, with a request for
confidential treatment, and you must follow the procedure explained in
FTC Rule 4.9(c), 16 CFR 4.9(c). Your comment will be kept confidential
only if the FTC General Counsel grants your request in accordance with
the law and the public interest. Postal mail addressed to the
Commission is subject to delay due to heightened security screening. As
a result, the Commission encourages you to submit your comments online.
To make sure that the Commission considers your online comment, you
must file it at https://ftcpublic.commentworks.com/ftc/regulationopra
by following the instructions on the web-based form. If this Notice
appears at http://www.regulations.gov, you also may file a comment
through that Web site.
If you file your comment on paper, write ``Regulation O, PRA
Comment, FTC File No. P134812'' on your comment and on the envelope,
and mail it to the following address: Federal Trade Commission, Office
of the Secretary, 600 Pennsylvania Avenue NW., Suite CC-5610, (Annex
J), Washington, DC 20580, or deliver your comment to the following
address: Federal Trade Commission, Office of the Secretary,
Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610,

[[Page 81143]]

(Annex J), Washington, DC 20024. If possible, submit your paper comment
to the Commission by courier or overnight service.
The FTC Act and other laws that the Commission administers permit
the collection of public comments to consider and use in this
proceeding as appropriate. The Commission will consider all timely and
responsive public comments that it receives on or before January 17,
2017. You can find more information, including routine uses permitted
by the Privacy Act, in the Commission's privacy policy, at http://www.ftc.gov/ftc/privacy.htm.

David C. Shonka,
Acting General Counsel.
[FR Doc. 2016-27701 Filed 11-16-16; 8:45 am]
BILLING CODE 6750-01-P

81140 Federal Register / Vol. 81, No. 222 / Thursday, November 17, 2016 / Notices

bank holding company and all of the indicated for that notice or to the offices for its portion of the information
banks and nonbanking companies of the Board of Governors. Comments collection requirements contained in the
owned by the bank holding company, must be received not later than Consumer Financial Protection Bureau’s
including the companies listed below. December 1, 2016. Regulation O (the Mortgage Assistance
The applications listed below, as well A. Federal Reserve Bank of Dallas Relief Services Rule). The FTC shares
as other related filings required by the (Robert L. Triplett III, Senior Vice enforcement of Regulation O with the
Board, are available for immediate President) 2200 North Pearl Street, Consumer Financial Protection Bureau
inspection at the Federal Reserve Bank Dallas, Texas 75201–2272: (CFPB). This clearance expires on
indicated. The applications will also be 1. Kemp Family 2016 Trust, Gillespie January 31, 2017.
available for inspection at the offices of County, Texas, Brian Daniel Kemp, San DATES: Comments must be received on
the Board of Governors. Interested Marcos, Texas, Cynthia Susan Kemp, or before January 17, 2017.
persons may express their views in Fredericksburg, Texas, and Daniel ADDRESSES: Interested parties may file a
writing on the standards enumerated in Wesley Kemp, Fredericksburg, Texas, as comment online or on paper by
the BHC Act (12 U.S.C. 1842(c)). If the trustees of the Kemp Family 2016 Trust; following the instructions in the
proposal also involves the acquisition of the Keller Family 2016 Trust, Gillespie, Request for Comments part of the
a nonbanking company, the review also Texas, Stephanie Ann Igler, San Angelo, Supplementary Information section
includes whether the acquisition of the Texas, Kory Allen Keller, below. Write ‘‘Regulation O, PRA
nonbanking company complies with the Fredericksburg, Texas, and Stacy Lynn Comment, FTC File No. P134812’’ on
standards in section 4 of the BHC Act Loth, Harper, Texas, as trustees of the your comment, and file your comment
(12 U.S.C. 1843). Unless otherwise Keller Family 2016 Trust; the Kathleen online at https://
noted, nonbanking activities will be Keller 2016 Trust, Blanco County, ftcpublic.commentworks.com/ftc/
conducted throughout the United States. Texas, Jody Lynn Lapp, Cottonsville,
Unless otherwise noted, comments regulationopra by following the
Maryland, as trustee of the Kathleen instructions on the web-based form. If
regarding each of these applications Keller 2016 Trust; and the Kay Durst
must be received at the Reserve Bank you prefer to file your comment on
Family 2016 Trust, Gillespie County, paper, mail or deliver your comment to
indicated or the offices of the Board of Texas, Kimberly Durst Bonnen,
Governors not later than December 12, the following address: Federal Trade
Friendswood, Texas, and Kristy Kay Commission, Office of the Secretary,
2016. LeJeune, College Station, Texas, as
A. Federal Reserve Bank of St. Louis 600 Pennsylvania Avenue NW., Suite
trustees of the Kay Durst Family 2016 CC–5610 (Annex J), Washington, DC
(David L. Hubbard, Senior Manager) Trust; to join the Bonnen/Durst/Hayne/
P.O. Box 442, St. Louis, Missouri 20580, or deliver your comment to the
Igler/Keller/Kemp/LeJeune/Loth control following address: Federal Trade
63166–2034. Comments can also be sent group, to retain voting shares of Security
electronically to Commission, Office of the Secretary,
Holding Company (the ‘‘Company’’), Constitution Center, 400 7th Street SW.,
Comments.applications@stls.frb.org: and indirectly Security State Bank &
1. Northeast Missouri Bancshares, 5th Floor, Suite 5610 (Annex J),
Trust (the ‘‘Bank’’), both of Washington, DC 20024.
Inc., to become a bank holding company Fredericksburg, Texas. In addition,
by acquiring 100 percent of The FOR FURTHER INFORMATION CONTACT:
Brian Daniel Kemp, San Marcos, Texas,
Mercantile Bank of Louisiana, all of Cynthia Susan Kemp, Fredericksburg, Requests for copies of the collection of
Louisiana, Missouri. Texas, and Daniel Wesley Kemp, information and supporting
Board of Governors of the Federal Reserve Fredericksburg, Texas, have applied to documentation should be addressed to
System, November 10, 2016. acquire shares of the Company and Rebecca Unruh, Attorney, Division of
Yao-Chin Chao, indirectly the Bank. Financial Practices, Bureau of Consumer
Assistant Secretary of the Board. Board of Governors of the Federal Protection, Federal Trade Commission,
Reserve System, November 10, 2016. 600 Pennsylvania Avenue NW., CC–
[FR Doc. 2016–27558 Filed 11–16–16; 8:45 am]
10232, Washington, DC 20580, (202)
BILLING CODE 6210–01–P
Yao-Chin Chao, 326–3365.
Assistant Secretary of the Board. SUPPLEMENTARY INFORMATION: Title X of
FEDERAL RESERVE SYSTEM [FR Doc. 2016–27559 Filed 11–16–16; 8:45 am] the Dodd-Frank Wall Street Reform and
BILLING CODE 6210–01–P Consumer Protection Act (‘‘Dodd-Frank
Change in Bank Control Notices; Act’’), Public Law 111–203, 124 Stat.
Acquisitions of Shares of a Bank or 1376 (2010), transferred the
Bank Holding Company FEDERAL TRADE COMMISSION Commission’s rulemaking authority
under the mortgage provisions in
The notificants listed below have Agency Information Collection section 626 of the 2009 Omnibus
applied under the Change in Bank Activities; Proposed Collection; Appropriations Act, as amended,1 to the
Control Act (12 U.S.C. 1817(j)) and Comment Request CFPB.2 On December 16, 2011, the
§ 225.41 of the Board’s Regulation Y (12
CFPB republished the Mortgage
CFR 225.41) to acquire shares of a bank AGENCY: Federal Trade Commission
Assistance Relief Services (‘‘MARS’’)
or bank holding company. The factors (FTC or Commission).
Rule as Regulation O (12 CFR part
that are considered in acting on the ACTION: Notice. 1015).3 As a result, the Commission
notices are set forth in paragraph 7 of
asabaliauskas on DSK3SPTVN1PROD with NOTICES

SUMMARY: The information collection subsequently rescinded its MARS Rule
the Act (12 U.S.C. 1817(j)(7)).
The notices are available for requirements described below will be (16 CFR part 322).4 Nonetheless, under
immediate inspection at the Federal submitted to the Office of Management the Dodd-Frank Act, the FTC retains its
Reserve Bank indicated. The notices and Budget (OMB) for review, as 1 Public Law 111–8, section 626, 123 Stat. 524
also will be available for inspection at required by the Paperwork Reduction (Mar. 11, 2009).
the offices of the Board of Governors. Act (PRA). The FTC seeks public 2 Dodd-Frank Act, § 1061, 12 U.S.C. 5581 (2010).

Interested persons may express their comments on its proposal to extend, for 3 76 FR 78130.

views in writing to the Reserve Bank three years, the current PRA clearance 4 77 FR 22200 (April 13, 2012).

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Document Created: 2016-11-17 03:00:04
Document Modified: 2016-11-17 03:00:04

Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Notices
Action		Notice.
Dates		Comments must be received on or before January 17, 2017.
Contact		Requests for copies of the collection
FR Citation		81 FR 81140