Administrative Agency the Proposed Regulation

Administrative Agency

The proposed regulation that was selected is: 31 CFR Part 103 Financial Crimes Enforcement Network. The agency that controls the regulation is the Treasury Department. This one was chosen, because it highlights how the federal government is attempting to close a loop hole; that could be used to launder money for illegal activities including terrorism. The possible effect that this will have on financial institutions is increased amounts of disclosures that must be made. Then, there are the obvious privacy issues, where entrepreneurs and business leaders who have financial accounts overseas, could be required to disclose more of their holdings.

The Proposal / Change

The proposed regulation (CFR Part 103 Financial Crimes Enforcement Network) is designed to close the loop holes that many Americans use to avoid the financial reporting requirements under American law. According to testimony that was provided by a number of different government agencies, many Americans are avoiding the laws by establishing bank accounts in foreign countries. This allows them to avoid have to report such activity to the federal government. As a result, Treasury officials believe that this loop hole is allowing for organized crime syndicates to function, financial crime syndicates to flourish and is helping many wealthy citizens to avoid any paying taxes on these profits. To close this loop hole the Treasury Department would require all signatories to submit the appropriate paper work by June 30th to the Internal Revenue Service, which details the activities and earnings in such bank accounts. ("Amendment to the Bank Secrecy Act Regulations Reports of Foreign Financial Accounts," 2010)

Public Comment

This proposed regulation appears to be the federal government increasing the overall scope of power that they have over the individual citizen. Where, they need this new regulation to monitor Americans who have profits that are made in foreign countries. This is troubling because these profits could have been reported and paid in the country that they were made. One could effectively argue that the federal government is attempting to impose a double taxation standard on all profits made overseas (legal / illegal). The deadline as to when comments must be made is August 26, 2010.

As a part of the promulgation process, you would be required to seek out different ways to challenge this new regulation. This is because once the promulgation process begins; it means that the proposal will more than likely become a part of the law.

The five different legal theories would include: the feminist theory, critical legal studies theory, the moral theory, intellectual capitalism theory and the over regulation theory. (Olson, 1999) the feminist theory is when you are making the arguments that the social structure in place is unfair or targeting a particular group of people. The critical legal studies theory is when you are looking beyond the issues of civil liberties and are instead focused on if the action is effective in supporting particular rights. The moral theory is when you are arguing that the best way to interpret the law is based upon what is best for society using: case precedent, established legal principals and the law. Intellectual capitalism is when you are arguing that freedom of speech is the best way for the minority of having their voices heard. Where, you are using the different actions to justify that the government could be stifling this free speech, which is leading the activity in question. The over regulation theory is when the federal / state government will impose new regulations without providing ample amounts of time for public comment and discussion. (Schlick, 2010)