Privacy Act of 1974; Amendment to an Existing System of Records

NATIONAL CREDIT UNION ADMINISTRATION

Privacy Act of 1974; Amendment to an Existing System of Records

AGENCY: National Credit Union Administration.

ACTION: Amendment to an existing system of records.

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SUMMARY: In accordance with the Privacy Act of 1974 (Privacy Act), the

National Credit Union Administration (NCUA or NCUA Board) is publishing

amendments to the existing system of records entitled Investigative

Reports Involving Any Crime or Suspected Crime against a Credit Union,

NCUA (NCUA 15) and is amending appendix B to its System of Records. The

changes to NCUA 15 reflect a new interagency suspicious activity

reporting process, combining the criminal referral and suspicious

financial transactions reporting requirements of the federal financial

regulatory agencies and the U.S. Department of the Treasury (Treasury),

and involving the use of a new computerized database maintained by the

Financial Crimes Enforcement Network (FinCEN), of the Treasury, on

behalf of these agencies and Treasury. Additional changes are made to

NCUA 15 to update the system. The changes to appendix B (which applies

to all of NCUA Systems of Records) updates the listing of NCUA regional

offices and the states covered by each region.

EFFECTIVE DATE: The revised system will become effective without

further notice on April 1, 1996, unless comments postmarked, received

or posted on NCUA's Electronic Bulletin Board on or before April 1

cause a contrary decision. If based on NCUA's review of comments

received, changes are made, NCUA will publish a new notice.

FOR FURTHER INFORMATION CONTACT: Hattie M. Ulan, Special Counsel to the

General Counsel, NCUA, 1775 Duke Street, Alexandria, VA 22314-3428.

SUPPLEMENTARY INFORMATION: Section (e)(4) of the Privacy Act of 1974, 5

U.S.C. 552a(e)(4) (Privacy Act), requires each agency to publish a

notice of the establishment of or revision to each system of records

maintained by the agency. The NCUA Board is amending existing system

NCUA 15 by changing its name from ``Investigative Reports Involving Any

Crime or Suspected Crime Against a Credit Union, NCUA'' to

``Investigative Reports Involving Any Crime, Suspected Crime or

Suspicious Activity Against a Credit Union, NCUA.'' Other changes to

the system are discussed below. Exemption rules promulgated pursuant to

exemption (k)(2) of the Privacy Act, 5 U.S.C. 552a(k)(2), continue to

apply for the amended system.

Certain of the changes to the system reflect an agreement between

FinCEN and the NCUA Board, the Office of the Comptroller of the

Currency (OCC), the Federal Deposit Insurance Corporation (FDIC), the

Office of Thrift Supervision (OTS), and the Federal Reserve Board (FRB)

(the federal financial regulatory agencies) to store Suspicious

Activity Reports (SAR) in electronic form in a database maintained by

FinCEN and located in Detroit, Michigan. The SAR is being adopted by

all federal financial regulatory agencies and by the Treasury as a

replacement for the Criminal Referral Form, which has been in use by

financial institutions to report suspected criminal activity by

individuals to the federal financial regulatory agencies and the

federal law enforcement authorities (see FRB, OCC and OTS proposed

rulemakings at 60 FR 34481, July 3, 1995; 60 FR 34476, July 3, 1995;

and 60 FR 36366, July 17, 1995; respectively). NCUA will be amending

its criminal referral form regulation (12 CFR part 748) at a later

date. Information from the Criminal Referral Form has always been

included in the existing system and similar information will continue

to be collected by the SAR. In addition to reports of suspected

criminal activity, the SAR will also allow a credit union or other

financial institution to report suspicious financial transactions under

federal money laundering statutes, pursuant to Treasury regulations,

(31 CFR part 103). Some of this information is currently reported on

currency transaction reports required to be filed by financial

institutions. Only the information collected by the SAR, and its status

updates, will be located in the database maintained by FinCEN; all

other information in the system will be located at the NCUA.

Pursuant to the interagency agreement between FinCEN and the

federal financial regulatory agencies, FinCEN will manage a

computerized database containing the SAR and status updates, which is

information currently collected and/or maintained separately by each of

the federal financial regulatory agencies. With regard to this

database, only those records that are generated under the jurisdiction

of the NCUA Board are considered to be NCUA records for purposes of the

Privacy Act. Access to and use of these NCUA records by other agencies

will continue to be governed by the routine uses in NCUA's System 15.

Accordingly, the ``Routine Uses'' element is being amended to

reflect the sharing among federal financial regulatory agencies and law

enforcement agencies of the information collected by the SAR and the

status updates. Additionally, the ``Safeguards'' element is amended to

add that on-line access to the computerized database maintained by

FinCEN is limited to authorized individuals who have been specified by

each federal financial regulatory agency and Treasury, and who have

been issued a nontransferable identifier or password.

Other amendments reflect an overall update to the system including

the addition of ``persons participating in the affairs of a credit

union'' as a category of individuals covered by the system; the

addition of a paragraph explaining the purpose of the system; the

addition of several routine uses and record source categories; and

changes in the system manager and address. The exemption for this

system of records continues to be (k)(2), because the information

consists of investigatory material compiled for law enforcement

purposes.

The NCUA Board is also updating appendix B to its Systems of

Records, to reflect correct addresses for the six NCUA regional offices

and the states covered by each.

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In accordance with 5 U.S.C. 552(r), a report of this amended system

of records is being filed with the President of the Senate, the Speaker

of the House of Representatives, and the Director of the Office of

Management and Budget (OMB). OMB has oversight authority over agency

implementation of the Privacy Act. This amended system of records will

become effective on April 1, 1996, without further notice, unless the

Board publishes a notice to the contrary in the Federal Register.

Accordingly, the Board has amended the system of records NCUA 15,

newly entitled ``Investigative Reports Involving Any Crimes, Suspected

Crime or Suspicious Activity Against a Credit Union, NCUA'', and

appendix B to its Systems of Records as follows:

NCUA-15

System name:

Investigative Reports Involving Any Crime, Suspected Crime or

Suspicious Activity Against a Credit Union, NCUA.

System location:

Office of General Counsel, National Credit Union Administration,

1775 Duke Street, Alexandria, VA 22314-3428. Computerized records of

Suspicious Activity Reports (SAR), with status updates, are managed by

the Financial Crimes Enforcement Network (FinCEN), Department of the

Treasury, pursuant to a contractual agreement, and are stored in

Detroit, Michigan. Authorized personnel at NCUA's Central Office and

six regional offices have on-line access to the computerized database

managed by FinCEN through individual work stations that are linked to

the database central computer.

Categories of individuals covered by the system:

Directors, officers, committee members, employees, agents, and

persons participating in the conduct of the affairs of federally

insured credit unions who are reported to be involved in suspected

criminal activity or suspicious financial transactions and are referred

to law enforcement officials; and other individuals who have been

involved in irregularities, violations of law, or unsafe or unsound

practices referenced in documents received by the NCUA in the course of

exercising its supervisory functions.

Categories of records in the system:

Inter- and intra-agency correspondence, memoranda and reports. The

SAR contains information identifying the credit union involved, the

suspected person, the type of suspicious activity involved, and any

witnesses.

Authority for maintenance of the system:

12 U.S.C. 1786 and 1789.

Purpose(s):

The overall system serves as a NCUA repository for investigatory or

enforcement information related to its responsibility to examine and

supervise federally insured credit unions. The system maintained by

FinCEN serves as the database for the cooperative storage, retrieval,

analysis, and use of information relating to Suspicious Activity

Reports made to or by the NCUA Board, the Federal Reserve Board, the

Office of the Comptroller of the Currency, the Federal Deposit

Insurance Corporation, the Office of Thrift Supervision, (collectively,

the federal financial regulatory agencies), and FinCEN to various law

enforcement agencies for possible criminal, civil, or administrative

proceedings based on known or suspected violations affecting or

involving persons, financial institutions, or other entities under the

supervision or jurisdiction of such federal financial regulatory

agencies.

Routine uses of records maintained in the system, including categories

of users, and the purposes of such uses:

Information in these records may be used to:

(1) Determine if any further agency action should be taken.

(2) Provide the federal financial regulatory agencies and FinCEN

with information relevant to their operations;

(3) Disclose information to third parties during the course of an

investigation to the extent necessary to obtain information pertinent

to the investigation;

(4) With regard to formal or informal enforcement actions; release

information pursuant to 12 U.S.C. 1786(s), which requires the NCUA

Board to publish and make available to the public final orders and

written agreements, and modifications thereto; and

(5) Standard routine uses as set forth in appendix A.

Policies and practices for storing, retrieving, accessing, retaining,

and disposing of records in the system:

Storage:

The records will be maintained in electronic data processing

systems and paper files.

Retrievability:

Computer output and file folders are retrievable by indexes of data

fields, including name of the credit union, NCUA Region, and

individuals' names.

Safeguards:

Paper records and word processing discs are stored at the NCUA in

lockable metal file cabinets. The database maintained by FinCEN

complies with applicable security requirements of the Department of the

Treasury. On-line access to the information in the database is limited

to authorized individuals who have been designated by each federal

financial regulatory agency and FinCEN, and each such individual has

been issued a nontransferable identifier or password.

Retention and disposal:

Records are maintained indefinitely.

System manager(s) and address:

General Counsel, NCUA, 1775 Duke Street, Alexandria, VA 22314-3428.

Notification procedures:

Inquiries should be sent to the System Manager as noted above.

Record access procedures:

Same as ``Notification procedure'' above.

Contesting records procedures:

Same as ``Notification procedure'' above.

Record source categories:

Information received by the NCUA Board from various sources,

including, but not limited to law enforcement and other agency

personnel involved in sending inquiries to the NCUA Board, NCUA

examiners, credit union officials, employees, and members. The

information maintained by FinCEN is compiled from SAR and related

historical and updating forms compiled by financial institutions, the

NCUA Board, and the other federal financial regulatory agencies for law

enforcement purposes.

System exempted from certain provisions of the Privacy Act:

This system is exempt from 5 U.S.C. 552a(c)(3), (d)(1), (d)(2),

(d)(3), (d)(4), (e)(1), (e)(4) (G), (H) and (I), and (f) of the Privacy

Act pursuant to 5 U.S.C. 552a(k)(2).

Appendix B--List of Regional Offices (Addresses and States Covered by

Each Region)

I. NCUA Region I Office: 9 Washington Square, Washington Avenue

Extension, Albany, NY 12205, Phone: 518-464-4180, FAX: 518-464-4195.

States covered: Connecticut, Maine, Massachusetts, New Hampshire,

New York, Rhode Island, Vermont.

II. NCUA Region II Office: 1775 Duke Street, Suite 4206,

Alexandria, VA 22314-3437, Phone: 703-838-0401, FAX: 703-838-0571.

States covered: Delaware, District of

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Columbia, Maryland, New Jersey, Pennsylvania, Virginia, West Virginia.

III. NCUA Region III Office: 7000 Central Parkway, Suite 1600,

Atlanta, GA 30328, Phone: 404-396-4042, FAX: 404-698-8211. States

covered: Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana,

Mississippi, North Carolina, Puerto Rico, South Carolina Tennessee,

Virgin Islands.

IV. NCUA Region IV Office: 4225 Naperville Road, Suite 125,

Lisle, IL 60532, Phone: 708-245-1000, FAX: 708-245-1016. States

covered: Illinois, Indiana, Michigan, Missouri, Ohio, Wisconsin.

V. NCUA Region V Office: 4807 Spicewood Springs Road, Suite

5200, Austin, TX 78759-8490, Phone 512-482-4500, FAX: 512-482-4511.

States covered: Arizona, Colorado, Iowa, Kansas, Minnesota,

Nebraska, New Mexico, North Dakota, Oklahoma, South Dakota, Texas,

Utah, Wyoming.

VI. NCUA Region VI Office: 2300 Clayton Road, Suite 1350,

Concord, CA 94520, Phone: 510-825-6125, FAX: 510-486-3729. States

covered: Alaska, American Samoa, California, Guam, Hawaii, Idaho,

Montana, Nevada, Oregon, Washington.

By the National Credit Union Administration Board on this 29th

day of February, 1996.

Becky Baker,

Secretary of the Board.

[FR Doc. 96- 5111 Filed 3-4-96; 8:45 am]

BILLING CODE 7535-01-U