Application Procedures and Criteria for Approval of Nonprofit Budget and Credit Counseling Agencies and Approval of Providers of a Personal Financial Management Instructional Course by United States T

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Application Procedures and Criteria for Approval of Nonprofit Budget and Credit Counseling Agencies and Approval of Providers of a Personal Financial Management Instructional Course by United States T Powered By Docstoc
					                                        38076             Federal Register / Vol. 71, No. 128 / Wednesday, July 5, 2006 / Rules and Regulations

                                        DEPARTMENT OF JUSTICE                                    include EOUST Docket No. 100 in the                   financial management, provide adequate
                                                                                                 subject box. Comments filed after the                 facilities situated in reasonably
                                        28 CFR Part 58                                           end of the comment period may be                      convenient locations where the
                                        [Docket No. EOUST 100]                                   considered to the extent feasible.                    instructional course is offered, except
                                                                                                 Comments received are public records.                 that such facilities may include the
                                        RIN 1105–AB17                                            SUPPLEMENTARY INFORMATION: This rule                  provision of such instructional course
                                                                                                 implements the Bankruptcy Abuse                       by telephone or through the Internet, if
                                        Application Procedures and Criteria for                                                                        such instructional course is effective,
                                        Approval of Nonprofit Budget and                         Prevention and Consumer Protection
                                                                                                 Act of 2005 (enacted April 20, 2005),                 and prepare and retain reasonable
                                        Credit Counseling Agencies and                                                                                 records to permit evaluation of the
                                        Approval of Providers of a Personal                      Public Law 109–8, sections 106(a), 119
                                                                                                 Stat. 37 (codified at 11 U.S.C. 109(h))               effectiveness of such instructional
                                        Financial Management Instructional                                                                             course by the EOUST and the United
                                        Course by United States Trustees                         and 106(e)(1), 119 Stat. 38 (codified at
                                                                                                 11 U.S.C. 111(a)–(e)). Under the                      States Trustee.
                                        AGENCY:  Executive Office for United 
                   BAPCPA, which became effective on                        As Congress stated in its conference
                                        States Trustees, Justice. 
                              October 17, 2005, individual debtors are              report, ‘‘the purpose of the bill is to
                                        ACTION: Interim final rule. 
                            required to consult with approved                     improve bankruptcy law and practice by
                                                                                                 agencies to receive a briefing on the                 restoring personal responsibility and
                                        SUMMARY: This interim final rule                         opportunities for credit counseling and               integrity in the bankruptcy system and
                                        (‘‘rule’’) sets forth the proposed                       a budget analysis, within 180 days                    ensure that the system is fair for both
                                        application procedures to be used by                     before filing for bankruptcy relief. 11               debtors and creditors * * * the bill
                                        United States Trustees for approval of                   U.S.C. 109(h)(1). Debtors are also                    requires debtors to receive credit
                                        nonprofit budget and credit counseling                   required to participate in a personal                 counseling before they can be eligible
                                        agencies (‘‘agencies’’) and for approval                 financial management instructional                    for bankruptcy relief so that they will
                                        of providers of a personal financial                                                                           make an informed choice about
                                                                                                 course with approved providers to
                                        management instructional course                                                                                bankruptcy, its alternatives, and
                                                                                                 receive instruction on how to establish
                                        (‘‘providers’’) under the Bankruptcy                                                                           consequences * * * the bill also
                                                                                                 and maintain a budget, how to manage
                                        Abuse Prevention and Consumer                                                                                  penalizes a creditor who unreasonably
                                                                                                 one’s money, and how to use credit
                                        Protection Act of 2005 (‘‘BAPCPA’’).                                                                           refuses to negotiate a pre-bankruptcy
                                                                                                 wisely. The debtor will not be granted
                                        Under the BAPCPA, individual debtors                                                                           debt repayment plan with a debtor.’’
                                                                                                 a discharge if this instruction is not
                                        are required to consult with approved                                                                          H.R. Rep. 109–31, pt. 1 at 2.
                                                                                                 obtained. 11 U.S.C. 727(a)(11),                          By submitting an application, an
                                        agencies to receive a briefing on the                    1328(g)(1), 1141(d)(3)(c).
                                        opportunities for credit counseling and                                                                        agency or provider is declaring under
                                                                                                    11 U.S.C. 111(b) provides that, in                 penalty of perjury that the information
                                        a budget analysis, within 180 days
                                                                                                 applicable jurisdictions, the United                  on the application is true, correct,
                                        before filing for bankruptcy relief, and
                                                                                                 States Trustee shall only approve an                  accurate, and complete.
                                        to consult with approved providers of a
                                                                                                 agency or provider after the United                      The remaining requirements set forth
                                        personal financial management
                                                                                                 States Trustee has thoroughly reviewed,               in the amending regulatory text are self-
                                        instructional course, after filing for
                                                                                                 under the standards set forth in                      explanatory. In determining whether an
                                        relief, before receiving a discharge of
                                                                                                 BAPCPA, the qualifications of the                     agency or provider meets the
                                        their debts. The BAPCPA also sets forth
                                                                                                 agency or provider and the services that              qualifications for approval and
                                        procedures and standards for the United
                                                                                                 will be offered by such agency or                     inclusion on the approved list, the
                                        States Trustees to use in approving
                                                                                                 provider, and has determined that such                EOUST and United States Trustee may
                                        agencies and providers for subsequent
                                                                                                 agency or provider fully satisfies the                rely on the application submitted by the
                                        inclusion on a publicly available agency
                                                                                                 standards. The United States Trustee                  agency or provider.
                                        list and provider list in each federal                                                                            The application form that credit
                                                                                                 may require such agency or provider
                                        judicial district where they are deemed                                                                        counseling agencies must use to apply
                                                                                                 that has sought approval to provide
                                        qualified to counsel or instruct                                                                               for approval under these regulations is
                                                                                                 information with respect to such review.
                                        individuals.                                                According to the new Bankruptcy                    EOUST–CC1, ‘‘Application for Approval
                                        DATES: Effective Date: July 5, 2006.                     Code provision, 11 U.S.C. 111, the                    as a Nonprofit Budget and Credit
                                           Comment Date: Comments due by                         United States Trustee shall only                      Counseling Agency,’’ which is available
                                        September 5, 2006.                                       approve an agency that demonstrates                   on the EOUST’s Web site along with the
                                        ADDRESSES: Comments on the rule                          that it will provide qualified counselors,            instructions. The application form that
                                        should be submitted by e-mail to                         maintain adequate provision for                       providers of an instructional course
                                        ust.ccderules.comment@usdoj.gov, by                      safekeeping and payment of client                     must use to apply for approval under
                                        telefax to 202–514–4100, or by postal                    funds, provide adequate counseling                    these regulations is EOUST–DE1,
                                        mail to: Executive Office for United                     with respect to client credit problems,               ‘‘Application for Approval of Provider of
                                        States Trustees (‘‘EOUST’’), Credit                      and deal responsibly and effectively                  a Personal Financial Management
                                        Counseling Application Processing, 20                    with other matters relating to the                    Instructional Course,’’ which is also
                                        Massachusetts Ave, 8th floor,                            quality, effectiveness, and financial                 available on EOUST’s Web site along
                                        Washington, DC 20530. To ensure                          security of the services it provides.                 with the instructions. Completed and
                                        proper handling, please reference                           Under 11 U.S.C. 111, the United                    signed credit counseling application
                                        EOUST Docket No. 100 on your                             States Trustee shall only approve a                   forms should be mailed to the EOUST,
                                        correspondence. You may view an                          provider that demonstrates that it will               Credit Counseling Application
                                        electronic version of this proposed rule                 provide trained personnel with                        Processing, 20 Massachusetts Ave., 8th
                                        at www.regulations.gov. You may also                     adequate experience and training in                   Floor, Washington, DC 20530.
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                                        comment via the Internet using the                       providing effective instruction and                   Completed and signed debtor education
                                        www.regulations.gov comment form for                     services, provide learning materials and              provider application forms should be
                                        this regulation. When submitting                         teaching methodologies designed to                    mailed to the EOUST, Debtor Education
                                        comments electronically you must                         assist debtors in understanding personal              Processing, 20 Massachusetts Ave. 8th


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                                                          Federal Register / Vol. 71, No. 128 / Wednesday, July 5, 2006 / Rules and Regulations                                          38077

                                        Floor, Washington, DC 20530.                             on consultations with individuals in the              or provider’s estimate of the burden of
                                        Applicants should refer to the EOUST’s                   credit counseling and debtor education                the proposed collection of information,
                                        Web site (http://www.usdoj.gov/ust) to                   industries and from the experience of                 including the validity of the
                                        determine the current mailing address at                 applicants who completed the initial                  methodology and assumptions used; (3)
                                        the time they submit subsequent                          applications.                                         enhance the quality, utility, and clarity
                                        applications.                                              The benefits of the rule clearly                    of the information to be collected; and
                                                                                                 outweigh the costs because the costs are              (4) minimize the burden of the
                                        Executive Order 12866                                    the lowest costs feasible to comply with              collection of information on those who
                                           This rule has been drafted and                        the requirement that a list be established            are to respond, including through the
                                        reviewed in accordance with Executive                    as required pursuant to Public Law No.                use of appropriate automated,
                                        Order 12866, ‘‘Regulatory Planning and                   109–8, section 106(e)(1).                             electronic, mechanical, or other
                                        Review’’ section 1(b), The Principles of                                                                       technological collection techniques or
                                        Regulation. The Department has                           Executive Order 13132
                                                                                                                                                       other forms of information technology
                                        determined that this rule is a                              This rule will not have substantial,               (e.g., permitting electronic submission
                                        ‘‘significant regulatory action’’ and                    direct effects on the States, on the                  of responses).
                                        accordingly this rule has been reviewed                  relationship between the national                        The form ‘‘Application for Approval
                                        by the Office of Management and                          government and the States, or on the                  as a Nonprofit Budget and Credit
                                        Budget.                                                  distribution of power and                             Counseling Agency’’ EOUST–CC1, is
                                           The Department has also assessed                      responsibilities among the various                    required to evaluate whether the
                                        both the costs and benefits of this rule                 levels of government. Therefore, in                   applicants met the established
                                        as required by section 1(b)(6) and has                   accordance with Executive Order 13132,                qualifications for credit counseling. The
                                        made a reasoned determination that the                   it is determined that this rule does not              respondents are credit counseling
                                        benefits of this regulation justify its                  have sufficient federalism implications               agencies who seek to counsel
                                        costs. The costs considered in this                      to warrant the preparation of a                       individuals before they file bankruptcy.
                                        regulation include the costs of                          Federalism Assessment.                                The number of applicants for the next
                                        submission of applications required if                                                                         year is unknown, though the EOUST
                                                                                                 Paperwork Reduction Act
                                        an agency or provider wishes to be                                                                             estimates there will be approximately
                                        approved for inclusion on the approved                      The information collection                         800 applicants, who will complete one
                                        list. Costs considered also include the                  requirements contained in this rule are               application, or a renewal application if
                                        cost of establishing and maintaining the                 currently under pending review by the                 submitted previously. The estimated
                                        approved list in each Federal judicial                   Office of Management and Budget                       burden imposed on the applicant is ten
                                        district. In an effort to minimize the                   (OMB) in accordance with the                          hours, each, totaling 8,000 estimated
                                        applicant’s burden, the application                      Paperwork Reduction Act of 1995, 44                   annual burden hours.
                                        keeps the number of items on the                         U.S.C. 3501–3520, and assigned OMB                       The form ‘‘Application for Approval
                                        application to a minimum.                                control number 1105–0084, for the                     as a Provider of a Personal Financial
                                           The costs to applicants will be                       ‘‘Application for Approval as a                       Management Instructional Course,’’
                                        minimal. The only anticipated costs are                  Nonprofit Budget and Credit Counseling                EOUST–DE1, is required to evaluate
                                        the photocopying and mailing of the                      Agency,’’ form number EOUST–CC1.                      whether the applicants met the
                                        requested records, along with the                        The information collection in                         established qualifications for providers
                                        salaries of the employees who complete                   connection with the ‘‘Application for                 of a personal financial management
                                        the applications equaling approximately                  Approval as a Provider of a Personal                  instructional course. The respondents
                                        $500 per application for agencies, and                   Financial Management Instructional                    are providers who seek to educate
                                        $300 per application for providers.                      Course,’’ form number EOUST–DE1, has                  individuals after they file bankruptcy.
                                        These costs are inherent in the                          been assigned OMB control number                      The number of applicants for the next
                                        qualification process mandated by                        1105–0085. The Department notes that                  year is unknown, though EOUST
                                        Congress. Those applying for approval                    full notice and comment opportunities                 estimated there may be approximately
                                        as credit counseling agencies must also                  were provided to the general public                   800 applicants, who will complete one
                                        obtain a surety bond in the amount of                    through the Paperwork Reduction Act                   application, or a renewal application if
                                        two percent of the agency’s prior year’s                 process, and that the applications and                submitted previously. The estimated
                                        gross disbursements made from trust                      associated requirements were modified                 burden imposed on the applicant is
                                        accounts or equal to the average daily                   to take into account the concerns of                  eight hours, each, totaling 6,400
                                        balance maintained in all trust accounts                 those who commented in this process.                  estimated annual burden hours.
                                        for the six months prior to submission                      Further comments and suggestions on
                                        of the application. In addition, credit                  these collections should be directed to               Regulatory Flexibility Act
                                        counseling agencies must obtain                          the Office of Management and Budget,                    This interim rule does not fall within
                                        employee fidelity insurance that equals                  Office of Information and Regulatory                  the definition of ‘‘rule’’ in the
                                        fifty percent of the surety bond.                        Affairs, Attention Department of Justice              Regulatory Flexibility Act, 5 U.S.C.
                                        Agencies are entitled to receive a credit                Desk Officer, Washington, DC 20503.                   601(2) because there is good cause for
                                        for any state bonds already obtained.                    Additionally, comments may be                         not publishing it as a general notice of
                                           The number of applicants that will                    submitted to OMB via facsimile to (202)               proposed rulemaking pursuant to
                                        ultimately apply is unknown, though                      395–5806.                                             section 553(b) of the Administrative
                                        the EOUST believes the number may                           Comments should address one or                     Procedure Act.
                                        reach approximately eight hundred                        more of the following four points: (1)
                                        applicants for agencies and eight                        Evaluate whether the collections are                  Unfunded Mandates Reform Act of
                                        hundred for providers. The annual hour                   necessary for the proper performance of               1995
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                                        burden on agencies is estimated to be                    the functions of the United States                      This rule does not require the
                                        ten (10) hours, and the annual hour                      Trustee, including whether the                        preparation of an assessment statement
                                        burden on providers is estimated to be                   information will have practical utility;              in accordance with the Unfunded
                                        eight (8) hours. This estimate is based                  (2) evaluate the accuracy of the agency               Mandates Reform Act of 1995, 2 U.S.C.


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                                        38078             Federal Register / Vol. 71, No. 128 / Wednesday, July 5, 2006 / Rules and Regulations

                                        1531. This rule does not include a                       initially approved agencies and                       disclosure of the information may be to
                                        Federal mandate that may result in the                   providers, the Department has                         district and regional offices of each
                                        annual expenditure by State, local, and                  determined that there is ‘‘good cause’’ to            United States Trustee. The information
                                        tribal governments, in the aggregate, or                 implement this application process                    will not be shared with any other
                                        by the private sector, of more than the                  immediately, and that delaying the                    agencies unless allowed by law.
                                        annual threshold established by the Act                  implementation in order to provide the                   Public Law 104–134 (April 26, 1996)
                                        ($123 million in 2005, adjusted                          Administrative Procedure Act’s normal                 requires that any person doing business
                                        annually for inflation). Therefore, no                   pre-promulgation notice-and-comment                   with the federal government furnish a
                                        actions were deemed necessary under                      period would be impracticable and                     Social Security Number or Tax
                                        the provisions of the Unfunded                           contrary to the public interest. 5 U.S.C.             Identification Number. This is an
                                        Mandates Reform Act of 1995.                             553(b)(B). This is especially true given              amendment to title 31, section 7701.
                                                                                                 that the public has already had an                    Furnishing the Social Security Number,
                                        Small Business Regulatory Enforcement
                                                                                                 opportunity to comment during the                     as well as other data, is voluntary, but
                                        Fairness Act of 1996
                                                                                                 Paperwork Reduction Act review                        failure to do so may delay or prevent
                                          This rule is not a major rule as                       process for the applications and that the             action on the application.
                                        defined by section 804 of the Small                      Department did make modifications
                                        Business Regulatory Enforcement                          pursuant to public commenters’                        List of Subjects in 28 CFR Part 58
                                        Fairness Act of 1996. This rule will not                 suggestions.                                            Administrative practice and
                                        result in an annual effect on the                           For the same reasons, the Department               procedure, Bankruptcy, Credit, Debts.
                                        economy of $100,000,000 or more; a                       also finds ‘‘good cause’’ for exempting
                                        major increase in costs or prices; or                    this rule from the provision of the                   ■ Accordingly, for the reasons set forth
                                        significant adverse effects on                           Administrative Procedure Act providing                in the preamble, part 58 of chapter I of
                                        competition, employment, investment,                     for a delayed effective date. U.S.C.                  Title 28 of the Code of Federal
                                        productivity, innovation, or on the                      553(d). Delaying the opportunity for                  Regulations is amended as follows:
                                        ability of United States-based                           agencies and providers to submit an
                                        companies to compete with foreign-                                                                             PART 58—[AMENDED]
                                                                                                 application and to seek to be included
                                        based companies in domestic and                          on the approved list would be contrary                ■ 1. The authority citation for part 58 is
                                        export markets.                                          to the public interest since there must               revised to read as follows:
                                        Administrative Procedure Act, 5 U.S.C.                   be sufficient agencies to offer services                Authority: 5 U.S.C. 301; 28 U.S.C. 509,
                                        553                                                      after the six month probationary term                 510, 586; 11 U.S.C. 109(h), 111, 727(a)(11),
                                                                                                 expires and without the availability of               1328(g)(1), 1141(d)(3)(c).
                                          This rule provides that nonprofit                      approved agencies, individuals may not
                                        budget and credit counseling agencies                    have access to bankruptcy relief. In                  ■ 2. Add §§ 58.15, 58.16, and 58.17 to
                                        and providers of a personal financial                    addition, without the availability of                 read as follows:
                                        management instructional course                          approved providers, debtors may not be
                                        desiring to be included on a publicly                                                                          § 58.15 Qualifications for approval as a
                                                                                                 able to obtain a discharge of debts                   nonprofit budget and credit counseling
                                        available list of agencies or providers                  because the personal financial
                                        deemed qualified to counsel or instruct                                                                        agency.
                                                                                                 management instructional course is
                                        debtors in each federal judicial district                mandatory before a discharge may be                      (a) Definition of agency. As used in
                                        shall submit a specified application to                  granted. In order for the United States               this section the term ‘‘agency’’ means
                                        the United States Trustee. Under the                     Trustee to evaluate the qualifications of             nonprofit budget and credit counseling
                                        new Bankruptcy Code provisions, an                       the agencies and providers, an                        agency.
                                        agency or provider may initially be                      application must be available for the                    (b) Qualifications. To be included on
                                        approved for a period of time not to                     agencies and providers to complete.                   the list of approved nonprofit budget
                                        exceed six months. Agencies or                              The Department welcomes post-                      and credit counseling agencies under 11
                                        providers must then re-apply for                         promulgation comments regarding this                  U.S.C. 111 an agency shall meet the
                                        approval annually. In order to have a                    interim final rule including the                      qualifications set forth in paragraphs (d)
                                        sufficient number of qualified agencies                  applications and appendices, which can                through (i) of this section. An agency
                                        and providers operating for debtors to                   be viewed at the EOUST’s Web site at                  shall continuously meet these
                                        receive the requisite credit counseling                  http://www.usdoj.gov/ust, and will                    qualifications in order to remain
                                        and debtor education, the United States                  consider those comments carefully in                  included on this list when the list is
                                        Trustees must rapidly gather                             continuing to review the application                  updated thereafter.
                                        information about agencies and                           process in the future. The Department                    (c) Preemption. Nothing contained in
                                        providers through an application                         also notes that it will publish more                  these regulations or the related
                                        process. This information must be                        comprehensive regulations later this                  application, appendices or instructions
                                        gathered with enough time to allow the                   year through a notice of proposed                     is intended to preempt any applicable
                                        United States Trustee to review the                      rulemaking with full opportunity for                  law or regulation governing the conduct
                                        application materials in order to                        public notice and comment.                            or operations of an agency.
                                        approve only qualified agencies and                                                                               (d) Structure and organization. A
                                        providers. Without this information, the                 Privacy Act Statement.                                nonprofit budget and credit counseling
                                        United States Trustee will be unable to                    Section 111 of title 11, United States              agency must:
                                        perform its Congressionally mandated                     Code, authorizes the collection of this                  (1) Be organized and operated as a
                                        duties.                                                  information. The primary use of this                  nonprofit entity;
                                          Existing agencies and providers were                   information is by the Executive Office                   (2) Be in compliance with all
                                        approved for a six-month probationary                    for United States Trustees to approve                 applicable laws and regulations of the
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                                        period beginning on September 16,                        nonprofit budget and credit counseling                United States and each state,
                                        2005. In light of the imminent                           agencies and to approve providers of                  commonwealth, district, or territory of
                                        expiration of the six-month                              personal financial management                         the United States in which the agency
                                        probationary period for a large group of                 instructional courses. Additional                     conducts credit counseling services;


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                                                          Federal Register / Vol. 71, No. 128 / Wednesday, July 5, 2006 / Rules and Regulations                                         38079

                                           (3) Have an independent board of                         (8) Maintain adequate records to issue             experience obtained on or after January
                                        directors the majority of which:                         replacement certificates and to verify                1, 2003; and
                                           (i) Are not employed by such agency;                  the authenticity of certificates filed by                (ii) If an agency offers telephone or
                                        and                                                      bankruptcy debtors;                                   Internet credit counseling services, the
                                           (ii) Will not directly or indirectly                     (9) Provide full disclosures to a client,          agency must, in addition to all other
                                        benefit financially from the outcome of                  including funding sources, counselor                  requirements, demonstrate sufficient
                                        the counseling services provided by                      qualifications, possible impact on credit             experience and proficiency in designing
                                        such agency;                                             reports, the cost of services to be paid              and providing such services over the
                                           (4) Ensure that no member of the                      by the client and how such costs will be              telephone and/or Internet, including
                                        board of directors or trustees, officer,                 paid, before services are rendered and                verification procedures to identify the
                                        manager, employee, counselor, or agent                   regardless of whether the client enters               person receiving the counseling services
                                        is a United States Trustee Program                       into a debt management plan.                          and to ensure that the counseling
                                        employee, a panel or standing trustee, a                    (f) Standards for counseling and                   services are properly completed.
                                        Federal judge, a Federal court employee,                 counselors. Agencies and credit                          (g) Activity report. Upon application
                                        a certified public accountant that                       counselors shall not, unless otherwise                for annual approval, the agency must
                                        performs audits of the agency’s trust                    authorized by law, provide legal advice               furnish an estimate of the information
                                        accounts, or a person with a financial or                on any matter. Agencies and credit                    requested in Appendix E, ‘‘Activity
                                        familial connection to the United States                 counselors shall:                                     Report for Approved Agencies,’’ of the
                                        Trustee Program.                                            (1) Provide adequate briefings, budget
                                                                                                                                                       application projected to the end of
                                           (5) Avoid any conduct or transactions                 analysis, and credit counseling services
                                                                                                                                                       either the probationary period or annual
                                        that generate or create the appearance of                to clients lasting an average of 60 to 90
                                                                                                                                                       period. Within thirty (30) days after the
                                        generating a private benefit for any                     minutes in length that include an
                                                                                                                                                       completion of either the probationary
                                        individual or group related or connected                 outline of available counseling
                                                                                                                                                       period or annual period, the agency
                                        to the Agency.                                           opportunities to resolve a client’s credit
                                                                                                                                                       must furnish an amended Appendix E
                                           (e) Fees. If a fee is charged for                     problems, an analysis of the client’s
                                                                                                                                                       which includes the actual information.
                                        counseling services, charge a reasonable                 current financial condition, discussion
                                                                                                 of the factors that caused such financial                (h) Agency declarations and
                                        fee, and provide services without regard                                                                       acknowledgments. (1) The agency’s
                                        to ability to pay the fee; the agency’s                  condition, and assistance in developing
                                                                                                 a plan to respond to the client’s                     president, chairman, trustee, or other
                                        criteria for providing services without a                                                                      authorized official is required to
                                        fee or at a reduced rate must be                         problems without incurring negative
                                                                                                 amortization of debt;                                 declare, by signing the application, that
                                        provided to the United States Trustee.                                                                         such individual is authorized to
                                        In addition, an agency shall:                               (2) Provide trained counselors who
                                                                                                 receive no commissions or bonuses                     complete the application on behalf of
                                           (1) Have sufficient computer
                                                                                                 based on the outcome of the counseling                the agency; that such individual has
                                        capabilities or secure access to issue
                                                                                                 services provided by such agency, and                 read and knows the contents of the
                                        certificates of completion of credit
                                                                                                 who have adequate experience, and                     application and all enclosures and
                                        counseling in conformance with the
                                                                                                 have been adequately trained to provide               attachments submitted; and that such
                                        directives established by the EOUST;
                                                                                                 counseling services to individuals in                 individual affirms under penalty of
                                           (2) Not withhold a certificate of
                                                                                                 financial difficulty, including the                   perjury that all of the representations
                                        counseling completion because of a
                                                                                                 matters described in sub-paragraph (1)                and statements contained therein are
                                        client’s inability to pay;
                                           (3) Advise the client of the fee                      of this paragraph. A counselor shall be               true and correct to the best of such
                                        schedule before services are provided                    deemed to have adequate training and                  individual’s knowledge, information,
                                        and inform the client that services are                  experience to provide credit counseling               and belief;
                                        available for free or at a reduced rate                  and budget analysis if the counselor is                  (2) By executing and submitting the
                                        based on a client’s ability to pay;                      accredited or certified by a recognized               ‘‘Application for Approval as a
                                           (4) Issue a certificate to any client                 independent organization, or has                      Nonprofit Budget and Credit Counseling
                                        who completes credit counseling and a                    successfully completed a course of                    Agency,’’ the agency acknowledges and
                                        budget analysis, regardless of whether a                 study acceptable to the United States                 agrees to abide by the prohibitions,
                                        client agrees to participate in a debt                   Trustee and has worked a minimum of                   limitations, and obligations set forth in
                                        management plan and without regard to                    six months in a related area, including               Appendix A, ‘‘Acknowledgments,
                                        the client’s ability to pay;                             personal finance, budgeting, and debt                 Agreements, and Declarations in
                                           (5) Issue the certificate within one                  management. The United States Trustee                 Support of Application for Approval as
                                        business day to a client after completion                Program does not endorse any specific                 a Nonprofit Budget and Credit
                                        of the required counseling or upon the                   course or certification program;                      Counseling Agency,’’ of the application
                                        earlier of the following:                                   (3) Demonstrate adequate experience                which include, but are not limited to,
                                           (i) A request by a client for the                     and background in providing credit                    the following:
                                        issuance of a certificate; or                            counseling, which means, at a                            (i) Making all records relating to the
                                           (ii) The completion or termination of                 minimum, that an agency must:                         agency’s compliance with 11 U.S.C. 111
                                        a counseling session, which may                             (i) Have experience in providing                   available to the United States Trustee
                                        include the administration of a debt                     credit counseling for the previous two                and EOUST upon request and
                                        management plan;                                         years. Alternatively, if an agency fails to           cooperating with the United States
                                           (6) Not charge a separate fee for the                 meet the two-year requirement, the                    Trustee and EOUST for any scheduled
                                        issuance of a certificate of counseling                  agency must currently employ in each                  or unscheduled on-site visits and
                                        unless the agency has clearly disclosed                  office location that serves clients at least          customer service audits;
                                        such fee before the initial credit                       one office supervisor with experience                    (ii) Cooperating with the United
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                                        counseling session;                                      and background in providing credit                    States Trustee and the EOUST in timely
                                           (7) Issue a certificate to each spouse                counseling for no less than two of the                responding to any questions or inquiries
                                        whether counseling was provided                          five years preceding the relevant                     concerning the agency’s operations and
                                        individually or in a joint session;                      application date, including only                      services;


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                                           (iii) Not excluding a creditor from a                 repayment plan, and provide for the                      (4) An agency may receive an offset or
                                        debt management plan because the                         safekeeping and payment of client                     credit in the employee bond/fidelity
                                        creditor declines to make a ‘‘fair share’’               funds, including an annual audit of the               insurance amount as follows:
                                        contribution to the agency;                              trust accounts in accordance with                        (i) The agency has obtained an
                                           (iv) Agreeing that any forms,                         generally accepted auditing standards                 employee bond or fidelity insurance in
                                        agreements, contracts, or other materials                by an independent certified public                    compliance with the requirements of a
                                        provided to a client will not limit the                  accountant, and appropriate employee                  state, commonwealth, district, or
                                        client’s right to seek damages against an                bonding; which includes:                              territory in which the agency seeks
                                        agency as provided for in 11 U.S.C.                         (i) Depositing all client funds into a             approval from the United States Trustee;
                                        111(g)(2);                                               trust account insured by a Federal                       (ii) The deductible cannot exceed a
                                           (v) Conducting a state and Federal                    institution with respect to each client.              reasonable amount considering the
                                        criminal background check at least                       The records creating the trust account                financial resources of the agency; and
                                        every five years for each person                         must demonstrate that the trust account                  (iii) The offset/credit is based on the
                                        providing credit counseling services, if                 was established in a fiduciary capacity               annual disbursements or average daily
                                        such criminal background check is                        and must comply with the Federal                      bank balance directly related to the
                                        authorized under state law, and not                      institution’s regulations so that each                clients in the particular state;
                                        employing as a counselor anyone who                      client’s funds are insured up to the
                                        has been convicted of any felony, or a                                                                            (5) If the agency has contracted with
                                                                                                 maximum amount allowable by the                       another entity (‘‘service provider’’) to
                                        crime involving fraud, dishonesty, or                    Federal institution;
                                        false statements, unless the United                                                                            administer any part of its debt
                                                                                                    (ii) Keeping and maintaining books,                management plan, the service provider
                                        States Trustee determines, upon review                   accounts, and records to provide a clear
                                        and in his or her discretion,                                                                                  is approved by the United States Trustee
                                                                                                 and readily understandable record of all              as a nonprofit budget and credit
                                        circumstances warrant a waiver of this                   business conducted by the agency; and
                                        employment requirement. The state                                                                              counseling agency, or the service
                                                                                                    (iii) Obtaining a surety bond payable              provider is specifically covered under
                                        criminal background check shall be                       to the United States in an amount which
                                        conducted in the state where the                                                                               the agency’s surety bond or has a surety
                                                                                                 is the lesser of:                                     bond in a sufficient amount to provide
                                        counselor resides. If a criminal
                                                                                                    (A) Two percent of the agency’s prior              for the safekeeping of the agency’s client
                                        background check is not authorized by
                                                                                                 year disbursements made from trust                    funds, and the service provider agrees in
                                        state law, the agency shall obtain a
                                                                                                 accounts; or                                          writing to allow the United States
                                        sworn statement from each counselor, at
                                                                                                    (B) Equal to the average daily balance             Trustee or EOUST to audit the trust
                                        least every five years, which attests to
                                                                                                 maintained in all trust accounts for the              accounts maintained by the service
                                        whether the counselor has been
                                                                                                 six months prior to submission of the                 provider and to review the service
                                        convicted of any felony or a crime
                                                                                                 application. At a minimum, the bond                   provider’s internal controls and
                                        involving fraud, dishonesty, or false
                                                                                                 must be $5,000;                                       administrative procedures.
                                        statements;
                                           (vi) Referring clients for counseling                    (2) An agency may receive an offset or
                                                                                                 credit for the surety bond amount as                  § 58.16 Procedures for inclusion on the
                                        services only to agencies that are                                                                             approved list.
                                        approved by the United States Trustee;                   follows:
                                           (vii) Complying with the EOUST’s                         (i) The agency has obtained a surety                  (a) As used in this section the term
                                        directions on approved advertising,                      bond, or similar cash, securities,                    ‘‘agency’’ means nonprofit budget and
                                        which is located in Appendix A to the                    insurance (other than employee fidelity               credit counseling agency.
                                        application;                                             insurance), or letter of credit, in                      (b) Each nonprofit budget and credit
                                           (viii) Not disclosing or providing to a               compliance with the requirements of the               counseling agency seeking to be
                                        credit reporting agency information                      state, commonwealth, district, or                     included on the list of approved
                                        concerning whether a client has                          territory (‘‘state’’) in which the agency             agencies must complete in its entirety
                                        received or sought instruction                           seeks approval from the United States                 the application form EOUST–CC1,
                                        concerning credit counseling or                          Trustee;                                              ‘‘Application for Approval as a
                                        personal financial management from an                       (ii) The surety bond, or similar cash,             Nonprofit Budget and Credit Counseling
                                        agency, and not selling information                      securities, insurance (other than                     Agency’’ (application), including all
                                        about a client to any third party without                employee fidelity insurance), or letter of            appendices, and submit it at the address
                                        the client’s written permission,                         credit provides protection for the clients            indicated on the application.
                                        regardless of whether the counseling is                  of the agency;                                           (c) The application must be executed
                                        presented in a classroom, on the                            (iii) The surety bond, or similar cash,            under penalty of perjury in a manner
                                        telephone, on the Internet, or any other                 securities, insurance, or letter of credit,           specified in 28 U.S.C. 1746.
                                        venue;                                                   must be written in favor of the state or                 (d) An application may not be
                                           (3) Upon request of the United States                 the appropriate state agency; and                     accepted by the EOUST unless it is
                                        Trustee or EOUST, an agency shall                           (iv) The offset or credit is based on the          complete and has been signed by an
                                        submit a completed and signed tax                        annual disbursements or average daily                 agency representative who is authorized
                                        waiver, which authorizes the United                      bank balance directly related to the                  to sign on behalf of the agency. An
                                        States Trustee or EOUST to seek                          clients in the particular state;                      application that is incomplete or has
                                        confidential information regarding the                      (3) An agency must have adequate                   been altered, amended, or changed in
                                        agency from the Internal Revenue                         employee bonding or fidelity insurance.               any respect from the application at the
                                        Service.                                                 The amount of such bonding or fidelity                United States Trustee Program’s Web
                                           (i) Agency financial requirements and                 shall be 50 percent of the surety bond                site may not be accepted by the EOUST.
                                        surety bonds. (1) If an agency offers debt               amount calculated prior to any offset/                Such an application will be denied, and
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                                        management plans, the agency must                        credit that the agency may receive for                no further action will be taken on the
                                        have adequate financial resources to                     state bonds. At a minimum, the                        request for inclusion on the approved
                                        provide continuing support services for                  employee bond or fidelity insurance                   list until a new application is submitted
                                        budgeting plans over the life of any                     must be $5,000;                                       that corrects the defects.


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                                           (e) The EOUST will not accept an                         (3) The agency must include with any               agency requests in writing a review
                                        application submitted by an agency on                    amendment to its application, a newly                 (‘‘request for review’’) by the Director,
                                        behalf of another individual or group of                 executed ‘‘certification and signature;’’             Executive Office for United States
                                        individuals. Each agency that desires to                    (4) The agency will notify the EOUST               Trustees (‘‘Director’’), no later than 20
                                        be included on the approved list must                    immediately upon the occurrence of any                calendar days from the date of issuance
                                        submit its own application.                              of the below noted events:                            of the denial or removal notice. In order
                                           (f) Each agency must submit a new                        (i) Cancellation or termination of tax             to be timely, a request for review must
                                        application 45 to 60 days before                         exempt status of the agency by the                    be received at the Office of the Director
                                        expiration of its six month probationary                 Internal Revenue Service;                             no later than 20 calendar days from the
                                        period or annual period to be                               (ii) Cessation of business of the                  date of the denial or removal notice to
                                        considered for annual approval. After                    agency or of any office of the agency;                the agency.
                                        the application is completed and signed,                    (iii) Termination or cancellation of                  (e) A decision to remove an agency
                                        the originals must be mailed to the                      any surety bond or fidelity insurance;                from the approved list shall take effect
                                        EOUST, Credit Counseling Application                        (iv) Any action brought against the                upon the expiration of an agency’s time
                                        Processing, at the address indicated on                  agency by a Federal or state agency,                  to seek review from the Director or, if
                                        the application. The EOUST will not                      including, but not limited to, the                    the agency timely seeks such review,
                                        accept a photocopy or facsimile of the                   Federal Trade Commission, or any                      upon the issuance of a final written
                                        application.                                             action against the surety bond or fidelity            decision by the Director.
                                           (g) An agency whose name appears on                   insurance;                                               (f) Notwithstanding sub-paragraph (e)
                                        the list incorrectly may submit a written                   (v) Any action by a state agency to                of this section, a decision to remove an
                                        request that the name be corrected. An                   suspend the license or cancel other                   agency from the approved list may
                                        agency whose name appears on the list                    authorization to do business;                         include, or may later be supplemented
                                        may submit a written request that its                       (vi) A suspension by an accreditation              by, an interim directive, which may
                                        name be removed from the list.                           organization or denial of accreditation;              immediately remove an agency from the
                                                                                                    (vii) Withdrawal as an approved                    approved list. Such an interim directive
                                           (h) By submitting an application, the
                                                                                                 agency; and                                           may be issued if one or more of the
                                        agency expressly consents to the release
                                                                                                    (viii) Change in the agency’s nonprofit            following are specifically found:
                                        and disclosure of the agency’s name on
                                                                                                 status;                                                  (1) The agency is not providing for the
                                        the approved list and the publication of
                                                                                                    (j) An approved agency may not                     safekeeping and payment of client
                                        the agency’s contact information.
                                                                                                 transfer or assign its United States                  funds;
                                           (i) Obligation to Update Information:                 Trustee approval under section 111 as a
                                        (1) The agency has a continuing duty to                                                                           (2) The agency’s surety bond has been
                                                                                                 nonprofit budget and credit counseling                canceled;
                                        promptly notify the EOUST of any                         agency to any party.
                                        circumstances that would materially                                                                               (3) The agency made a material false
                                        alter or change a response to any section                § 58.17 Procedures for denying an                     statement on the application;
                                        of the application, including but not                    application or removing an agency from the               (4) The agency (board of directors,
                                        limited to, changes in the location of                   approved list, and the administrative review          officer, manager, employee, counselor,
                                        primary or satellite business office(s);                 rights granted to denied or removed                   or agent) has engaged in conduct that is
                                        the principal contact person; name or                    agencies.                                             dishonest, deceitful, fraudulent, or
                                        fictitious name under which the agency                      (a) As used in this section the term               criminal in nature;
                                        does business; management, including                     ‘‘agency’’ means nonprofit budget and                    (5) The agency (board of directors,
                                        the board of directors; a merger or                      credit counseling agency.                             officer, manager, employee, counselor,
                                        consolidation with another entity; and                      (b) No administrative review will be               or agent) has engaged in other gross
                                        the banks or financial institutions used                 granted to any applicant that submitted               misconduct that is unbefitting the
                                        by the agency;                                           an incomplete application and had its                 agency’s position as an approved
                                                                                                 application denied due to                             agency;
                                           (2) The agency shall request approval
                                        by amendment to its application, and                     incompleteness and failed to                             (6) The agency’s nonprofit status has
                                        prior to occurrence of the following                     subsequently submit a completed                       been revoked by the entity that issued
                                        changes:                                                 application.                                          the agency its nonprofit status;
                                                                                                    (c) The agency shall be notified in                   (7) Revocation of the agency’s license
                                           (i) Cancellation or change in amount
                                                                                                 writing of any decision to deny the                   to do business in a particular state,
                                        of the surety bond or employee fidelity
                                                                                                 agency’s application or to remove the                 provided the immediate removal shall
                                        bond or insurance;
                                                                                                 agency from the approved list                         apply only to the federal judicial
                                           (ii) The engagement of a service                      (‘‘notice’’). The notice shall state the              districts within the particular state; or
                                        provider to provide counseling services                  reason(s) for the decision and shall                     (8) The Internal Revenue Service
                                        to administer debt management plans,                     reference any documents or                            revokes the agency’s tax exempt status.
                                        or to otherwise control or account for                   communications with the agency, which                    (g) The agency’s request for review
                                        client funds;                                            were relied upon in making the denial                 shall fully describe why the agency
                                           (iii) An increase in the fees,                        or removal decision. If such documents                disagrees with the denial or removal
                                        contributions, or payments received                      or communications were not provided                   decision, and shall be accompanied by
                                        from clients for counseling services or a                to the United States Trustee or the                   all documents and materials that the
                                        change in the agency’s policy for the                    EOUST by the agency, copies of the                    agency wants the Director to consider in
                                        reduction or waiver of fees;                             documents or communications shall be                  reviewing the decision. The agency
                                           (iv) Expansion into additional judicial               provided with the notice. The notice                  shall send a copy of the request for
                                        districts or withdrawal from judicial                    shall be sent to the agency by overnight              review, and the accompanying
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                                        districts where the agency is approved;                  courier, for delivery the next business               documents and materials, to the
                                        and                                                      day.                                                  Director by overnight courier, for
                                           (v) Method of delivery or type of                        (d) The notice shall advise the agency             delivery the next business day, and
                                        counseling services;                                     that the decision is final unless the                 must be received by the Director within


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                                        20 calendar days of the denial or                        be in compliance with all applicable                     (iv) Saving for emergencies, for
                                        removal notice.                                          laws and regulations of the United                    periodic payments, and for financial
                                           (h) The Director may seek additional                  States and each state, commonwealth,                  goals;
                                        information from any party, in the                       district, or territory of the United States              (3) Wise use of credit, which consists
                                        manner and to the extent the Director                    in which the provider conducts courses.               of the following:
                                        deems appropriate.                                       Nothing contained in these instructions,                 (i) The types, sources, and costs of
                                           (i) The Director shall issue a written                the application, or the appendices                    credit and loans;
                                        decision no later than 45 calendar days                  thereto, is intended to preempt any                      (ii) Identifying debt warning signs;
                                        from the receipt of the agency’s request                 applicable law or regulation governing                   (iii) Appropriate use of credit and
                                        for review, unless the agency agrees to                  the conduct or operations of the                      alternatives to credit use;
                                        a longer period of time or the Director                  provider.                                                (iv) Checking a credit rating;
                                        extends the period. That decision shall                     (e) Standards for teachers. A provider                (4) Consumer information, which
                                        determine whether the denial or                          shall employ trained personnel with                   consists of the following:
                                        removal decision is supported by the                     adequate experience and training in                      (i) Public and non-profit resources for
                                        record and the action is an appropriate                  providing effective instruction and                   consumer assistance;
                                        exercise of discretion, and shall adopt,                 services, which means the provider                       (ii) Applicable consumer protection
                                        modify, or reject the denial or removal                  shall employ, at a minimum, an                        laws and regulations, such as those
                                        decision. The Director’s decision shall                  individual who holds at least one of the              governing correction of a credit record
                                        constitute final government agency                       following current certifications and/or               and protection against consumer fraud.
                                        action.                                                  accreditations, or who has equivalent                    (g) Course procedures. A provider
                                           (j) In reaching a determination, the                  training or experience, to supervise                  shall ensure the following procedures
                                        Director may specify a person to act as                  instructors:                                          are followed:
                                        a reviewing official. The reviewing                         (1) A state teacher’s certificate in any              (1) Generally, the provider shall:
                                        official shall not be a person who was                   subject;                                                 (i) Require each debtor student to
                                        involved in the denial or removal                           (2) Certification as a Certified                   provide proof of identification, to
                                        decision. The reviewing official’s duties                Financial Planner (CFP);                              provide his/her bankruptcy case
                                        shall be specified by the Director on a                     (3) Certification or accreditation as a            number, and to sign in and sign out of
                                        case by case basis, and may include                      credit counselor or a financial counselor             the course;
                                        reviewing the record, obtaining                          by a recognized independent                              (ii) Conduct the course for a minimum
                                        additional information from the                          organization;                                         of two hours in length. Courses offered
                                        participants, providing the Director with                   (4) Certification by the American                  via the Internet or telephone should be
                                        written recommendations, or such other                   Association of Family and Consumer                    designed for completion with a
                                        duties as the Director shall prescribe in                Sciences;                                             minimum of two hours;
                                        a particular case.                                          (5) Registered as a Registered                        (iii) At the end of the course, collect
                                           (k) An agency that files a request for                Financial Consultant (RFC); or                        from each debtor student a completed
                                        review shall bear its own costs and                         (6) Certified as a Certified Public                course evaluation. The evaluation shall
                                        expenses, including counsel fees.                        Accountant (CPA).                                     be in a form acceptable to the EOUST;
                                                                                                    (f) Learning materials and                            (2) For classroom instruction, the
                                        §§ 58.18 through 58.24       [Reserved]                  methodologies. A provider shall provide               provider shall ensure:
                                        ■ 3. Add and reserve §§ 58.18 through                    learning materials and teaching                          (i) A teacher is present for purposes
                                        58.24.                                                   methodologies designed to assist                      of instruction and interaction with
                                        ■ 4. Add §§ 58.25, 58.26, and 58.27 to                   debtors in understanding personal                     debtor students;
                                        read as follows:                                         financial management and that are                        (ii) Class size is reasonably limited to
                                                                                                 consistent with stated objectives                     ensure an effective presentation of the
                                        § 58.25 Qualifications for approval as                   directly related to the goals of such                 course materials;
                                        providers of a personal financial                        instructional course, which include                      (3) For telephone instruction, the
                                        management instructional course:                         written information and instruction on                provider shall:
                                           (a) Definition of provider. As used in                all of the following topics:                             (i) Provide a toll-free telephone
                                        this section the term ‘‘provider’’ means                    (1) Budget development, which                      number;
                                        a provider of a personal financial                       consists of the following:                               (ii) Comply with the Americans with
                                        management instructional course.                            (i) Setting short-term and long-term               Disabilities Act and also include a toll-
                                           (b) Qualifications. To be included on                 financial goals, as well as developing                free number for deaf or hearing-
                                        the list of approved providers under 11                  skills to assist in achieving these goals;            impaired debtor students, e.g. TTY,
                                        U.S.C. 111, a provider shall meet the                       (ii) Calculating gross monthly income              TDD, or Text Telephone;
                                        qualifications set forth in paragraphs (d)               and net monthly income;                                  (iii) Employ adequate procedures to
                                        through (k) of this section. A provider                     (iii) Identifying and classifying                  ensure that the debtor student is the
                                        shall continuously meet these                            monthly expenses as fixed, variable, or               individual who completed the course;
                                        qualifications in order to remain                        periodic;                                                (iv) Ensure that a teacher is present
                                        included on this list when the list is                      (2) Money management, which                        telephonically for purposes of
                                        updated thereafter.                                      consists of the following:                            instruction and interaction with debtor
                                           (c) Preemption. Nothing contained in                     (i) Keeping adequate financial                     students;
                                        these regulations or the related                         records;                                                 (v) Provide copies of the learning
                                        application, appendices or instructions                     (ii) Developing decision-making skills             materials to debtor students before the
                                        is intended to preempt any applicable                    required to distinguish between wants                 telephone instruction session;
                                        law or regulation governing the conduct                  and needs, and to comparison shop for                    (4) For Internet instruction, the
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                                        or operations of a provider.                             goods and services;                                   provider shall:
                                           (d) Structure and organization. A                        (iii) Maintaining appropriate levels of               (i) Comply with the Americans with
                                        provider of a personal financial                         insurance coverage, taking into account               Disabilities Act and its application to
                                        management instructional course must                     the types and costs of insurance;                     the Internet;


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                                                          Federal Register / Vol. 71, No. 128 / Wednesday, July 5, 2006 / Rules and Regulations                                           38083

                                           (ii) Employ adequate procedures to                    and provide services without regard to                   (i) The provider’s fee schedule,
                                        ensure that the debtor student is the                    ability to pay the fee; the provider’s                including any cost to the debtor student
                                        individual who completed the course                      criteria for providing services without a             in addition to the course fee;
                                        and that the individual received two                     fee or at a reduced rate must be                         (ii) A statement that the course is
                                        hours of instruction;                                    provided to the United States Trustee.                offered to debtor students without
                                           (iii) Ensure that a teacher will respond              In addition, a provider shall:                        regard to a debtor student’s ability to
                                        within one business day to a debtor                         (1) Have sufficient computer                       pay;
                                        student’s questions or comments;                         capabilities to issue certificates of                    (iii) The qualifications, including
                                           (5) In addition to meeting all other                  completion of an instructional course in              educational and training background, of
                                        requirements, the provider who                           conformance with the directives                       the provider’s teachers;
                                        conducts telephone or Internet courses                   established by the EOUST;                                (iv) A schedule of course dates, times,
                                        must demonstrate sufficient experience                      (2) Advise the debtor student of the               and locations;
                                        and proficiency in designing and                         fee schedule before the instructional                    (v) A statement that the provider does
                                        providing services over the telephone or                 course is provided and inform the                     not pay or receive fees or other
                                        Internet.                                                debtor student that services are                      consideration for the referral of debtor
                                           (h) Facilities. A provider shall provide              available for free or at a reduced rate               students to or by the provider;
                                        adequate facilities situated in a                        based on the debtor student’s ability to                 (vi) A statement that, upon
                                        reasonably convenient location at which                  pay;                                                  completion of the course, the provider
                                        such instructional course is offered,                       (3) Issue certificates to any debtor               will provide a certificate of course
                                        except that such facilities may include                  student who completes an instructional                completion to the debtor student;
                                        the provisions of such instructional                     course without regard to the debtor                      (3) By executing and submitting the
                                        course by telephone or through the                       student’s ability to pay;                             ‘‘Application for Approval as a Provider
                                        Internet, if such instructional course is                   (4) Issue the certificate within three             of a Personal Financial Management
                                        effective;                                               business days to a debtor student after
                                           (1) The provider shall ensure that any                                                                      Instructional Course,’’ the provider
                                                                                                 completion of the required instructional              acknowledges and agrees to abide by the
                                        facility used by debtor students                         course;
                                        complies with all applicable laws and                                                                          prohibitions, limitations, and
                                                                                                    (5) Not withhold the issuance of a
                                        regulations including, but not limited                                                                         obligations set forth in Appendix A,
                                                                                                 certificate because of a debtor student’s
                                        to, the Americans with Disabilities Act                                                                        ‘‘Acknowledgments, Agreements, and
                                                                                                 failure to obtain a passing grade on a
                                        Accessibility Guidelines, and all federal,                                                                     Declarations in Support of Application
                                                                                                 quiz, examination, or test. Although a
                                        state, and local fire, health, safety, and                                                                     for Approval as a Provider of a Personal
                                                                                                 test may be incorporated into the
                                        occupancy laws, codes, rules, or                                                                               Financial Management Instructional
                                                                                                 curriculum to evaluate the effectiveness
                                        regulations.                                                                                                   Course,’’ which include, but are not
                                                                                                 of the course and to ensure that the
                                           (i) Activity report and records. A                                                                          limited to, the following:
                                                                                                 course has been completed, the provider
                                        provider shall prepare and retain                                                                                 (i) Ensuring that no member of the
                                                                                                 cannot deny a certificate to a debtor
                                        reasonable records (which shall include                                                                        board of directors or trustees, owner,
                                                                                                 student if the debtor student has
                                        the debtor’s bankruptcy case number) to                                                                        officer, manager, employee, or agent is
                                                                                                 completed the course as designed;
                                        permit evaluation of the effectiveness of                   (6) Not charge a separate fee for the              a United States Trustee Program
                                        such instructional course, including any                 issuance of a certificate unless the                  employee, panel trustee, or person with
                                        evaluation of satisfaction of                            provider has clearly disclosed such fee               a financial or familial connection to a
                                        instructional course requirements for                    before the beginning of the instructional             panel trustee or an employee of the
                                        each debtor attending such instructional                 course;                                               United States Trustee Program. For
                                        course, which shall be available for                        (7) Issue a certificate to each spouse             purposes of this paragraph, a person is
                                        inspection and evaluation by the                         in a joint case whether the course is                 not deemed to have a financial
                                        EOUST or the United States Trustee for                   completed independently or jointly;                   relationship to a panel trustee solely
                                        the district in which such instructional                    (8) Maintain adequate records to issue             because the person is an employee of
                                        course is offered;                                       replacement certificates and to verify                the panel trustee;
                                           (1) Upon application for annual                       the authenticity of certificates filed by                (ii) Not paying or receiving referral
                                        approval, the provider must furnish an                   bankruptcy debtors.                                   fees or other consideration for the
                                        estimate of the information requested in                    (k) Provider declarations and                      referral of debtor students;
                                        Appendix F to the application,                           acknowledgments. (1) The provider’s                      (iii) Ensuring that the course will not
                                        projected to the end of either the                       owner, president, chairman, trustee, or               contain any commercial advertising,
                                        probationary period or annual period.                    other authorized official is required to              and that the provider shall not promote,
                                        Within 30 days after the completion of                   declare, by signing the application, that             market, or sell financial products; solicit
                                        either the probationary period or annual                 such individual is authorized to                      business of any type; or sell information
                                        period, the provider must furnish an                     complete the application on behalf of                 about the debtor to any third party
                                        amended Appendix F which includes                        the provider; that such individual has                without the debtor’s permission,
                                        the actual information;                                  read and knows the contents of the                    whether the course is presented in a
                                           (2) Make all records related to the                   application and all enclosures and                    classroom, on the telephone, or on the
                                        provider’s compliance with 11 U.S.C.                     attachments submitted; and to affirm                  Internet;
                                        111 available to the United States                       under penalty of perjury that all of the                 (iv) Complying with the EOUST’s
                                        Trustee or EOUST upon request and                        representations and statements                        directions on approved advertising,
                                        cooperate with the United States                         contained therein are true and correct to             which is located in Appendix A to the
                                        Trustee or EOUST for any scheduled or                    the best of such individual’s knowledge,              application;
                                        unscheduled on-site visit or customer                    information, and belief;                                 (v) Cooperating with the EOUST and
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                                        service audit.                                              (2) The provider shall disclose the                the United States Trustee in timely
                                           (j) Fees and certificates. If a fee is                following information to each debtor                  responding to any questions or inquiries
                                        charged for counseling services, a                       student before the commencement of                    concerning the provider’s operations
                                        provider shall charge a reasonable fee,                  the instructional course:                             and/or instructional course;


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                                        38084             Federal Register / Vol. 71, No. 128 / Wednesday, July 5, 2006 / Rules and Regulations

                                           (vi) Consenting that any forms,                       further action on the request for                     newly executed ‘‘certification and
                                        agreements, contracts, or other materials                inclusion on the approved list will be                signature;’’
                                        furnished to a debtor student will not                   taken until a new application is                         (4) The provider will notify the
                                        limit the debtor student’s ability to bring              submitted that corrects the defects.                  EOUST immediately upon the
                                        an action or claim under the provision                      (e) The EOUST will not accept an                   occurrence of any of the below noted
                                        of the United States Bankruptcy Code.                    application submitted by a provider on                events:
                                        11 U.S.C. 101 et. seq.                                   behalf of another individual or group of                 (i) Cessation of business of the
                                           (l) Universities. Accredited                          individuals. Each provider that desires               provider or of any office of the provider;
                                        universities and community colleges                      to be included on the approved list must                 (ii) Any action by a state agency to
                                        (‘‘universities’’) are eligible to apply to              submit its own application.                           suspend the license or cancel other
                                        become providers using a streamlined                        (f) Each provider must submit a new                authorization to do business;
                                        version of the application. Universities                 application 45 to 60 days before                         (iii) A suspension by an accreditation
                                        need to complete only the following                      expiration of its six month probationary              organization or denial of accreditation;
                                        portions of the application:                             period or annual period to be                         and
                                           (1) In section 1—General Information                  considered for annual approval. After                    (iv) Withdrawal as an approved
                                        Concerning the Provider—complete                         the application is completed and signed,              provider;
                                        sections: 1.1, 1.2, 1.3, 1.4, 1.5, 1.6, 1.8,             the originals and a copy must be mailed                  (j) An approved provider may not
                                        and 1.10;                                                to the EOUST, Debtor Education                        transfer or assign its United States
                                           (2) In section 4—Learning Materials                   Provider Application Processing, at the               Trustee approval under section 111 as a
                                        and Methodologies—complete sections:                     address indicated on the application.                 provider of a personal financial
                                        4.1, 4.2, 4.4, 4.5, 4.6, 4.7, and 4.8;                   The EOUST will not accept a photocopy                 management instructional course.
                                           (3) In section 6—Fees and Issuance of                 or facsimile of the application in lieu of
                                        Certificates—complete section 6.1;                       the original.                                         § 58.27 Procedures for denying an
                                           (4) In section 7—Activity Report for                     (g) A provider whose name appears                  application or removing a provider from the
                                                                                                                                                       approved list, and the administrative review
                                        Approved Providers—complete section                      on the list incorrectly may submit a                  rights granted to denied or removed
                                        7.1;                                                     written request that the name be                      providers.
                                           (5) In section 8—Acknowledgments,                     corrected. A provider whose name
                                                                                                                                                          (a) As used in this section the term
                                        Agreements, and Declarations—                            appears on the list may submit a written
                                                                                                                                                       ‘‘provider’’ means a provider of a
                                        complete sections 8.1 and 8.2;                           request that its name be removed from
                                           (6) In section 9—Certification and                                                                          personal financial management
                                                                                                 the list.
                                        Signature—execute the application as                        (h) By submitting an application, the              instructional course.
                                                                                                 provider expressly consents to the                       (b) No administrative review will be
                                        indicated in the instructions;
                                           (7) Completed applications should be                  release and disclosure of the provider’s              granted to any applicant that submitted
                                        submitted to the EOUST in accordance                     name on the approved list, and the                    an incomplete application and had its
                                        with the procedures in section 58.19.                    publication of the provider’s contact                 application denied due to
                                                                                                 information.                                          incompleteness and failed to
                                        § 58.26 Procedures for inclusion on the                     (i) Obligation to Update Information:              subsequently submit a completed
                                        approved provider list.
                                                                                                 (1) The provider has a continuing duty                application.
                                           (a) As used in this section the term                  to promptly notify the EOUST of any                      (c) The provider shall be notified in
                                        ‘‘provider’’ means a provider of a                       circumstances that would materially                   writing of any decision denying the
                                        personal financial management                            alter or change a response to any section             provider’s application or to remove the
                                        instructional course.                                    of the application, including but not                 provider from the approved list
                                           (b) Each provider seeking to be                       limited to, changes in the location of                (‘‘notice’’). The notice shall state the
                                        included on the list of approved                         primary or satellite business office(s);              reason(s) for the decision and shall
                                        providers must complete in its entirety                  the principal contact person; name or                 reference any documents or
                                        the application form EOUST–DE1,                          fictitious name under which the                       communications with the provider,
                                        ‘‘Application for Approval as a Provider                 provider does business; management,                   which were relied upon in making the
                                        of a Personal Financial Management                       including the board of directors; and a               denial or removal decision. If such
                                        Course’’ (application), including all                    merger or consolidation with another                  documents or communications were not
                                        appendices, and submit it at the address                 entity;                                               provided to the United States Trustee or
                                        indicated on the application. Accredited                    (2) The provider shall request                     the EOUST by the provider, copies of
                                        universities may complete only the                       approval by amendment to its                          the documents or communications shall
                                        portions of the application as indicated                 application, and prior to occurrence of               be provided with the notice. The notice
                                        in section 58.25(l).                                     the following changes:                                shall be sent to the provider by
                                           (c) The application must be executed                     (i) An increase in the fees,                       overnight courier, for delivery the next
                                        under penalty of perjury in a manner                     contributions, or payments received                   business day.
                                        specified in 28 U.S.C. 1746.                             from debtor students for the                             (d) The notice shall advise the
                                           (d) An application will not be                        instructional course or a change in the               provider that the decision is final unless
                                        accepted by the EOUST unless it is                       provider’s policy for the reduction or                the provider requests in writing a
                                        complete and has been signed by a                        waiver of fees;                                       review (‘‘request for review’’) by the
                                        provider representative who is                              (ii) Expansion into additional judicial            Director, Executive Office for United
                                        authorized to sign on behalf of the                      districts or withdrawal from judicial                 States Trustees (‘‘Director’’), no later
                                        provider. An application that is                         districts where the provider is                       than 20 calendar days from the date of
                                        incomplete or has been altered,                          approved; and                                         issuance of the denial or removal notice.
                                        amended, or changed in any respect                          (iii) Method of delivery type of                   In order to be timely, a request for
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                                        from the application at the United States                instructional services or course                      review must be received at the Office of
                                        Trustee Program’s Web site will not be                   curriculum;                                           the Director no later than 20 calendar
                                        accepted by the EOUST. Such an                              (3) The provider must include with                 days from the date of the removal notice
                                        application will be denied, and no                       any amendment to its application, a                   to the provider.


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                                                          Federal Register / Vol. 71, No. 128 / Wednesday, July 5, 2006 / Rules and Regulations                                                 38085

                                           (e) A decision to remove a provider                   a reviewing official. The reviewing                   skin. The final rule becomes effective on
                                        from the approved list shall take effect                 official shall not be a person who was                May 30, 2006. As required by the
                                        upon the expiration of a provider’s time                 involved in the denial or removal                     Paperwork Reduction Act of 1995, the
                                        to seek review from the Director or, if                  decision. The reviewing official’s duties             Federal Register notice for the Cr(VI)
                                        the provider timely seeks such review,                   shall be specified by the Director on a               final rule stated that compliance with
                                        upon the issuance of a final written                     case by case basis, and may include                   the collection of information
                                        decision by the Director.                                reviewing the record, obtaining                       requirements was not required until
                                           (f) Notwithstanding sub-paragraph (e)                 additional information from the                       these requirements are approved by
                                        of this section, a decision to remove a                  participants, providing the Director with             OMB, and the Department of Labor
                                        provider from the approved list may                      written recommendations, or such other                publishes a notice in the Federal
                                        include, or may later be supplemented                    duties as the Director shall prescribe in             Register announcing that OMB
                                        by, an interim directive, which may                      a particular case.                                    approved and assigned a control
                                        immediately remove a provider from the                      (k) A provider that files a request for            number to the Cr(VI) requirements.
                                        approved list. Such an interim directive                 review shall bear its own costs and                   Under 5 CFR 1320.5(b), an agency may
                                        may be issued if one or more of the                      expenses, including counsel fees.                     not conduct or sponsor a collection of
                                        following are specifically found:                          Dated: June 22, 2006.                               information unless: (1) The collection of
                                           (1) The provider made a material false                                                                      information displays a current valid
                                                                                                 Clifford J. White III,
                                        statement on the application;                                                                                  OMB control number, and (2) the
                                           (2) The provider (board of directors,                 Acting Director, Executive Office for United
                                                                                                 States Trustees.                                      agency informs members of the public
                                        officer, manager, employee, counselor,                                                                         who must respond to the collection of
                                        or agent) has engaged in conduct that is                 [FR Doc. E6–10234 Filed 7–3–06; 8:45 am]
                                                                                                                                                       information that they are not required to
                                        dishonest, deceitful, fraudulent, or                     BILLING CODE 4410–40–P
                                                                                                                                                       respond to the collection of information
                                        criminal in nature;                                                                                            unless the agency displays a currently
                                           (3) The provider (board of directors,                                                                       valid OMB control number.
                                        officer, manager, employee, counselor,                   DEPARTMENT OF LABOR
                                                                                                                                                          On February 27, 2006, OSHA
                                        or agent) has engaged in other gross
                                                                                                 Occupational Safety and Health                        submitted the Cr(VI) information
                                        misconduct that is unbefitting the
                                                                                                 Administration                                        collection request for the final rule to
                                        provider’s position as an approved
                                                                                                                                                       OMB for approval in accordance with
                                        provider;
                                                                                                 29 CFR Parts 1910, 1915, and 1926                     the Paperwork Reduction Act of 1995
                                           (4) Revocation of the provider’s
                                                                                                                                                       (44 U.S.C. 3501–3520). On March 28,
                                        license to do business in a particular                   RIN 1218–AB45                                         2006, OMB approved the collections of
                                        state, provided the immediate removal
                                                                                                                                                       information contained in the final rule
                                        shall apply only to the federal judicial                 Occupational Exposure to Hexavalent
                                                                                                                                                       and assigned this collection OMB
                                        districts within the particular state.                   Chromium; Approval of Information
                                           (g) The provider’s request for review                                                                       Control Number 1218–0252 title
                                                                                                 Collection Requirements
                                        shall fully describe why the provider                                                                          ‘‘Chromium (VI) Standards for General
                                        disagrees with the denial or removal                     AGENCY:  Occupational Safety and Health               Industry (29 CFR 1910.1026), Shipyard
                                        decision, and shall be accompanied by                    Administration (OSHA), Department of                  Employment (29 CFR 1915.1026),1 and
                                        all documents and materials that the                     Labor.                                                Construction (29 CFR 1926.1126).’’ The
                                        provider wants the Director to consider                  ACTION: Final rule; notice of Office of               approval for the collection expires on
                                        in reviewing the decision. The provider                  Management and Budget (OMB)                           March 31, 2009. The approved
                                        shall send a copy of the request for                     approval of collection of information                 collections of information are:
                                        review, and the accompanying                             requirements.                                            • Exposure Determination—
                                        documents and materials, to the                                                                                1910.1026(d), 1915.1026(d), and
                                                                                                 SUMMARY: OSHA is announcing that the                  1926.1126(d).
                                        Director by overnight courier, for                       collection of information requirements
                                        delivery the next business day, and                                                                               Paragraphs 1910.1026(d)(2),
                                                                                                 contained in the Chromium (VI)                        1915.1026(d)(2), and 1926.1126(d)(2)—
                                        must be received by the Director within                  standard (29 CFR parts 1910, 1915,
                                        20 calendar days of the denial or                                                                              Scheduled monitoring option.
                                                                                                 1917, 1918, and 1926) have been                          Paragraphs 1910.1026(d)(3),
                                        removal notice.                                          approved by OMB under the Paperwork
                                           (h) The Director may seek additional                                                                        1915.1026(d)(3), and 1926.1126(d)(3)—
                                                                                                 Reduction Act of 1995. The OMB                        Performance-oriented option.
                                        information from any party, in the
                                                                                                 approval number is 1218–0252.
                                        manner and to the extent the Director                                                                             Paragraphs 1910.1026(d)(4),
                                                                                                 DATES: This final rule is effective July 5,           1915.1026(d)(4), and 1926.1126(d)(4)—
                                        deems appropriate.
                                           (i) The Director shall issue a written                2006.                                                 Employee notification of determination
                                        decision no later than 45 calendar days                  FOR FURTHER INFORMATION CONTACT:                      results.
                                        from the receipt of the provider’s                       Todd Owen, OSHA, Directorate of                          • Regulated Areas—1910.1026(e).
                                        request for review, unless the provider                  Standards and Guidance, Room N–3609,                     Paragraphs 1910.1026(e)(2)—
                                        agrees to a longer period of time or the                 U.S. Department of Labor, 200                         Demarcation.
                                        Director extends the period. That                        Constitution Avenue, NW., Washington,                    • Respiratory Protection—
                                        decision shall determine whether the                     DC 20210; telephone (202) 693–2222.                   1910.1026(g), 1915.1026(f), and
                                        denial or removal decision is supported                  SUPPLEMENTARY INFORMATION: OSHA                       1926.1126(f).
                                        by the record and the action is an                       published a final rule for chromium (VI)                 Paragraphs 1910.1026(g)(2),
                                        appropriate exercise of discretion, and                  (Cr(VI)) on February 28, 2006, after                  1915.1026(f)(2), and 1926.1126(f)(2)—
                                        shall adopt, modify, or reject the denial                determining that employees exposed to                 Respiratory protection program (in
                                        or removal decision. The Director’s                      Cr(VI) are at increased risk of
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                                                                                                                                                       accordance with 29 CFR 1910.134).
                                        decision shall constitute final                          developing lung cancer (71 FR 10099).
                                        government agency action.                                In addition, occupational exposure to                   1 The standard for shipyard employment also
                                           (j) In reaching a determination, the                  Cr(VI) may result in asthma, and                      applies to marine terminals (29 CFR part 1917) and
                                        Director may specify a person to act as                  damage to the nasal passages and the                  longshoring (29 CFR part 1918).



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