Public Dissemination of the Identity of a Delinquent Debtor

DEPARTMENT OF THE TREASURY <SUBAGY>Bureau of the Fiscal Service</SUBAGY> <CFR>31 CFR Part 285</CFR> <RIN>RIN 1530-AA32</RIN> <SUBJECT>Public Dissemination of the Identity of a Delinquent Debtor</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Bureau of the Fiscal Service, Department of the Treasury. <HD SOURCE="HED">ACTION:</HD> Notice of proposed rulemaking. <SUM> <HD SOURCE="HED">SUMMARY:</HD> The Debt Collection Improvement Act of 1996 (DCIA) authorizes Federal agencies to publicly disseminate information regarding the identity of persons owing delinquent nontax debts to the United States for the purpose of collecting the debts. The Department of the Treasury, Bureau of the Fiscal Service (Fiscal Service), proposes to promulgate this rule to establish the minimum procedures Federal agencies must follow prior to publicly disseminating information regarding the identity of delinquent debtors and the standards for determining when use of this debt collection tool is appropriate. </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> Written comments must be submitted (for electronic comments) or postmarked (for paper comments) by October 21, 2025. No late comments will be accepted and commenters should be aware that the electronic Federal Docket Management System will not accept comments after Midnight Eastern Time on the last day of the comment period. </EFFDATE> <HD SOURCE="HED">ADDRESSES:</HD> All comments must include the agency name (“Bureau of the Fiscal Service”) and docket number (“FISCAL-2023-0001”) for this rulemaking. In general, comments will be published on <E T="03">Regulations.gov</E> without change, including any business or personal information provided. Comments received, including attachments and other supporting materials, are part of the public record and subject to public disclosure. Do not enclose any information in your comment or supporting materials that you consider confidential or inappropriate for public disclosure. Due to mail processing delays, Fiscal Service encourages the electronic submission of comments but also accepts paper submission of comments. Comments may be submitted as follows: <E T="03">Electronic Comments:</E> Fiscal Service encourages that all comments be submitted through the Federal eRulemaking Portal, which provides the ability to comment on, search, and view publicly available rulemaking materials, including comments received on rules. Please go to <E T="03">http://www.regulations.gov</E> and follow the online instructions at that site for submitting comments. <E T="03">Paper Comments:</E> Paper comments that duplicate an electronic submission are not necessary and are discouraged. Should you wish to mail a paper comment in lieu of an electronic comment, it should be sent via regular or express mail to: Director, Policy and Oversight Division, Disbursing and Debt Management, Bureau of the Fiscal Service, Landover Warehouse, 3201 Pennsy Drive, Landover, MD 20785. <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> Director, Policy and Oversight Division, Disbursing and Debt Management, Bureau of the Fiscal Service, at (202) 874-6810. </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">I. Background</HD> Section 31001(r)(1) of the Debt Collection Improvement Act of 1996 (DCIA), Public Law 104-134, 110 Stat. 1321-358 (1996), codified at 31 U.S.C. 3720E, authorizes the head of an agency to publish or otherwise publicly disseminate information regarding the identity of persons owing delinquent nontax debts to the United States for the purpose of collecting the debts, subject to certain conditions. The DCIA directs the Secretary of the Treasury to issue regulations establishing procedures and requirements to carry out this authority. For the collection of nontax debt for the Federal Government, Fiscal Service is responsible for promulgating the regulations governing this and other provisions of the DCIA on behalf of the Secretary of the Treasury. This proposed rule establishes standards so that actions under this authority are directed, as required by the DCIA, toward those debtors with the ability to pay their delinquent nontax debts. This proposed rule also establishes procedures and requirements so that actions under this authority are not taken until debtors are afforded the opportunity to verify, contest, and compromise their debts and so that persons are not incorrectly identified. The proposed rule limits the types of debts subject to publication under this rule to nontax debts arising from civil or criminal penalties or fines, fraud, presentation of false claim, misrepresentation, or circumstances where the agency has an enforcement goal. Generally, this rule does not apply to other types of debts owed to the federal government, such as delinquent small business loans or student loans, where there is no civil or criminal adjudication. <HD SOURCE="HD1">II. Section-by-Section Analysis</HD> This section describes, section-by-section, the reasoning for each provision of this new rule. <HD SOURCE="HD2">(a) Definitions</HD> Paragraph (a) of this section sets forth definitions applicable to this rule. Terms used in this section are defined for purposes of this section only. This rule proposes to define the term “debt” consistent with, though more narrowly than, the statutory definition of debt in 31 U.S.C. 3701(b). Specifically, this rule would apply only to debts arising from civil or criminal penalties or fines, fraud, presentation of false claim, misrepresentation, or circumstances where the agency has determined that it has an enforcement goal. This definition allows agencies to focus on the categories of debts where the Government's collection equities are the strongest. This definition also most closely serves the purpose of maximizing collections by holding violators publicly accountable for their actions. Fiscal Service reserves the right, as authorized under 31 U.S.C. 3720E, to later determine that it is appropriate to expand or further limit the definition of “debt” for the purposes of this rule. <HD SOURCE="HD2">(b) General Rule</HD> Paragraph (b) states the general rule that agencies may publish information regarding the identity of a person owing a delinquent debt to the United States and the existence of the debt for the purpose of collecting the debt. <HD SOURCE="HD2">(c) Agency Procedures</HD> Paragraph (c) states that agencies must prescribe their own written procedures governing the publication of the identity of delinquent debtors, provided such rules are consistent with this section. This rule provides high-level guidance that agencies should tailor to their collection needs. Because the programs giving rise to these debts vary widely across the Government, a “one-size-fits-all” approach would not be practical or effective. What exact protections and procedures are appropriate may differ significantly from agency to agency, and among different types of debts or debtors. As such, this rule defers to agencies and their expertise to develop the procedures that are appropriate for their classes of debts and debtors. For example, what constitutes proper notice will differ based on what is reasonable under the circumstances. Generally, notice sent to the debtor's address last known to the agency suffices. However, if an agency knows that the debtor did not receive a notice ( <E T="03">e.g.,</E> the notice was returned undelivered), in some circumstances, the agency may determine it should or must (or may determine it need not) conduct further investigation for a better address; whether the agency should conduct further investigation may depend on the factors the agency considers appropriate, such as the age of the debt, the characteristics of debtor population, the obligation of the debtor to keep the agency informed of address changes, or the possibility that the agency has failed to update its address records properly. Agencies must certify to the Secretary of the Treasury that they have complied with the requirements of this section prior to taking action under this section. Because the exact protections and procedures that are appropriate may differ significantly from agency to agency, based on debt type, debtor type, agency goals, or other relevant factors, Fiscal Service has determined that it is appropriate to rely on the expertise of the certifying agency, which is best equipped to understand the nuances of its debt portfolio and debtor populations. An agency need only certify its compliance with these rules to the Secretary when it first adopts or modifies its procedures and need not certify compliance each time information regarding the identity of delinquent debtors is made public. Fiscal Service's receipt and acceptance of the agency's certification constitutes “review” of the Secretary, as required by 31 U.S.C. 3720E, and Fiscal Service may further prescribe in guidance the manner in which the certification must be made and the manner in which the acceptance will be documented. Nothing in this rule makes any publication of the identity of delinquent debtors under 31 U.S.C. 3720E and this rule subject to the general non-disclosure provisions of the Privacy Act of 1974 (5 U.S.C. 552a), the Trade Secrets Act (18 U.S.C. 1831 through 1839), 18 U.S.C. 905, or other laws generally prohibiting disclosure of information. However, agencies should ensure that any publication is consistent with applicable law. For example, an agency may determine it should specify as a routine use under its system of records notice that it may publish names and identities of delinquent debtors or, alternatively, may determine that such disclosure is permissible without any such routine use. <HD SOURCE="HD2">(d) Determination of Ability To Pay</HD> Paragraph (d) provides standards agencies must use to determine if a debtor has the abil ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 31k characters. 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