12 CFR § 268.205 - Employment of aliens; Access to sensitive information.

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§ 268.205 Employment of aliens; Access to sensitive information.

(a)Definitions. The definitions contained in this paragraph (a) apply only to this section:

(1)Classified Information means information that is classified for national security purposes under Executive Order No. 12958, entitled “Classified National Security Information,” including any amendments or superseding orders that the President of the United States may issue from time to time.

(2)Confidential Supervisory Information means confidential supervisory information of the Board, as defined in 12 CFR 261.2(c). Three internal security designations, which are subject to change by the Board, apply to Confidential Supervisory Information. Those designations are:

(i)Restricted-Controlled FR generally applies to information that, if disclosed to or modified by unauthorized individuals, might result in the risk of serious monetary loss, serious productivity loss or serious embarrassment to the Federal Reserve System. Examples of Confidential Supervisory Information designated as Restricted-Controlled FR include, but are not limited to, certain significant lists of financial institution supervisory ratings and nonpublic advance information regarding bank mergers or failures.

(ii)Restricted FR covers information that is less sensitive than Restricted-Controlled FR information and, in general, is the largest category of Confidential Supervisory Information. This information, if disclosed to or modified by unauthorized individuals, might result in the risk of significant monetary loss, significant productivity loss, or significant embarrassment to the Federal Reserve System. Examples of Confidential Supervisory Information designated as Restricted FR include, but are not limited to, single supervisory ratings (e.g., CAMELS, BOPEC, etc.), Federal Reserve examination and inspection reports and workpapers, Interagency Country Exposure Review Committee (ICERC) country exposure determinations, and shared national credit data or listings.

(iii)Internal FR covers information that is less sensitive than Restricted FR or Restricted-Controlled FR and generally applies to information that, if disclosed to or modified by unauthorized individuals, might result in the risk of some monetary loss, some productivity loss, or some embarrassment to the Federal Reserve System. Examples of Confidential Supervisory Information designated as Internal FR include, but are not limited to, foreign banking organization country studies and Federal Reserve risk assessments.

(3)Country List refers to the list contained in the annual federal appropriations laws of specific countries, including a general category of “countries allied with the United States in a current defense effort,” from which particular categories of persons who are exempt from a ban on the use of appropriated funds are eligible to be hired as Federal employees in the excepted service or in the senior executive service. The appropriations ban is codified at 5 U.S.C. 3101 note. The list of eligible countries and persons is subject to legislative and other change.

(4)Eligible Position refers to a position or job family requiring access to Sensitive Information for which the Board determines that hiring a Non-Citizen is appropriate.

(5)Employee means an individual who works full-time or part-time and is appointed into Board service for a period of more than 90 days. The term “Employee” does not include members of the Board.

(6)FOMC Information means confidential information of the Federal Open Market Committee (FOMC) regardless of the form or format in which it is created, conveyed, or maintained. FOMC Information includes information derived from confidential FOMC materials. Three internal security designations, which are subject to change by the FOMC, apply to FOMC Information as follows:

(i)Class I FOMC generally applies to materials containing policymaker input, such as that related to monetary policy decisions at meetings, views expressed by policy makers on future policy, and identification of meeting participants who express particular views. Examples of Class I FOMC Information include, but are not limited to, the “Bluebook,” drafts of meeting minutes, unreleased meeting transcripts, documents reflecting the preparation of semi-annual forecasts and related testimony, and certain sensitive internal memorandums and reports.

(ii)Class II FOMC covers information that is less sensitive than Class I FOMC. This designation generally applies to staff forecasts prepared for the FOMC and to information about open market operations. Examples of Class II FOMC Information include, but are not limited to, Part I of the “Greenbook,” reports of the Manager on domestic and foreign open market operations, and other materials on economic and financial developments.

(iii)Class III FOMC covers information that is less sensitive than either Class II or Class I. This designation generally applies to background information supporting policy discussions and includes, but is not limited to, Part II of the Greenbook.

(7)National refers to any individual who meets the requirements described in 8 U.S.C. 1408.

(8)Non-Citizen refers to any individual who is not a Protected Individual.

(9)Protected Individual means -

(i) A citizen or National of the United States,

(ii) An alien who:

(A) Meets the conditions set forth in 8 U.S.C. 1324b(a)(3)(B), as amended, and

(B) Has filed with the Board or the appropriate Federal Reserve Bank a declaration of intention to become a citizen of the United States, or

(iii) An alien who:

(A) Is lawfully admitted for permanent residence, is admitted for temporary residence under 8 U.S.C. 1160(a) or section 1255a(a)(1), is admitted as a refugee under 8 U.S.C. 1157, or is granted asylum under 8 U.S.C. 1158;

(B) Was an Employee of the Board or a Federal Reserve Bank on January 1, 2006;

(C) Before requesting access to Sensitive Information filed an application for U.S. citizenship;

(D) Has had his or her application for citizenship pending for two years or less, unless in the case of an application pending for a longer period, the alien can establish that the alien is actively pursuing naturalization. Time consumed by the Department of Homeland Security, Citizenship and Immigration Services (or its predecessor or successor agency) in processing the application shall not be counted toward the 2-year period; and

(E) Has completed a background investigation acceptable to the Board.

(10)Sensitive Information means FOMC Information, Classified Information, and Confidential Supervisory Information.

(b)Hiring and access -

(1)Prohibition against hiring unauthorized aliens. An individual is eligible for employment with the Board only if he or she satisfies the requirements of Section 101 of the Immigration Reform and Control Act of 1986, 8 U.S.C. 1324a.

(2)Preference. Consistent with applicable law, where two applicants for employment at the Board are equally qualified for a position, the Board shall prefer the citizen or National of the United States over the equally qualified person who is not a citizen or National of the United States.

(3)Protected Individuals' access to Sensitive Information. The Board may hire a person as an Employee into a position that requires access to Sensitive Information if the person is a Protected Individual.

(4)Non-Citizens' access to Sensitive Information. The Board shall not hire a Non-Citizen into a position that requires access to Sensitive Information unless the Non-Citizen:

(i) Is in an Eligible Position; and

(ii) Meets the requirements of paragraph (c) of this section allowing access to Sensitive Information.

(c)Access to Sensitive Information -

(1)Generally. The Board will grant access to Sensitive Information only in accordance with the Board's rules and policies regarding access to Sensitive Information and, if applicable, the rules and policies of the FOMC. Access to any level of Sensitive Information includes access to all lower levels of that type of Sensitive Information. An Employee who is not a Protected Individual may not have access to FOMC Information or Confidential Supervisory Information unless otherwise permitted by this paragraph (c).

(2)FOMC Information -

(i)Access by a Non-Citizen from a country on the Country List. An Employee in an Eligible Position who is a Non-Citizen from a country that, on the date the Employee begins employment with the Federal Reserve System or on the date access is granted, is on the Country List shall be granted access to Class I FOMC Information only if the Employee:

(A) Has been recommended for such access by the Employee's Division Director;

(B) Has been resident in the United States for at least six years, at least two of which include satisfactory employment with the Board and/or one or more of the Federal Reserve Banks; and

(C) Has completed a background investigation acceptable to the Board.

(ii)Access by a Non-Citizen from a country not on the Country List. An Employee in an Eligible Position who is a Non-Citizen from a country that, on the date the Employee begins employment with the Federal Reserve System and on the date access is granted, is not on the Country List:

(A) Shall not be granted access to Class I FOMC Information, and

(B) Shall be granted access to Class II FOMC Information only upon:

(1) The recommendation of the Employee's Division Director;

(2) Six years of residence in the United States, at least two of which include satisfactory employment by the Board and/or one or more of the Federal Reserve Banks; and

(3) Completion of a background investigation acceptable to the Board.

(iii)Changes to the Country List. If the Employee's country is deleted from the Country List after the date the Employee begins employment with the Federal Reserve System, the Employee's existing access to Class I or Class II FOMC information will not be affected by the change in the Country List. Similarly, the Employee would continue to be eligible for access to Class I information and may be granted such access if he or she meets the remaining conditions outlined in paragraph (c)(2)(i) for employees from a country on the Country List.

(3)Confidential Supervisory Information -

(i)Access by a Non-Citizen from a country on the Country List. An Employee in an Eligible Position who is a Non-Citizen from a country that, on the date the Employee begins employment with the Federal Reserve System or on the date access is granted, is on the Country List shall be granted access to Confidential Supervisory Information designated as Restricted-Controlled FR only if the Employee:

(A) Has been recommended for such access by the Employee's Division Director;

(B) Has been resident in the United States for at least six years, at least two of which include satisfactory employment with the Board and/or one or more of the Federal Reserve Banks; and

(C) Has completed a background investigation acceptable to the Board.

(ii)Access by a Non-Citizen from a country not on the Country List. An Employee in an Eligible Position who is a Non-Citizen from a country that, on the date the Employee begins employment with the Federal Reserve System and on the date access is granted, is not on the Country List:

(A) Shall not be granted access to Confidential Supervisory Information designated as Restricted-Controlled FR; and

(B) Shall be granted access to Confidential Supervisory Information designated as Restricted FR only upon:

(1) The recommendation of the Employee's Division Director;

(2) Six years of residence in the United States, at least two of which include satisfactory employment by the Board and/or one or more of the Federal Reserve Banks; and

(3) Completion of a background investigation acceptable to the Board.

(iii)Changes to the Country List. If the Employee's country is deleted from the Country List after the date the Employee begins employment with the Federal Reserve System, the Employee's existing access to Confidential Supervisory Information designated as Restricted FR or Restricted-Controlled FR will not be affected by the change in the Country List. Similarly, the Employee would continue to be eligible for access to Confidential Supervisory Information designated as Restricted-Controlled FR information and may be granted such access if he or she meets the remaining conditions outlined in paragraph (c)(3)(i) for employees from a country on the Country List.

(4)Access to Sensitive Information by Reserve Bank employees -

(i)FOMC Information. By action of the FOMC, a Reserve Bank employee may access FOMC Information in accordance with these rules.

(ii)Confidential Supervisory Information. A Reserve Bank employee will be granted access to Confidential Supervisory Information only to the extent the employee meets all of the requirements for access to Confidential Supervisory Information provided in this paragraph (c) and the employee has received approval for such access from the Board's Director for Banking Supervision and Regulation. Notwithstanding the foregoing, this rule does not affect access that has been granted to employees hired before the effective date of this rule.

(5)Exceptions for access to Confidential Supervisory Information. A Board or Reserve Bank employer may request an exception for access to Confidential Supervisory Information. The requester must demonstrate that unusual circumstances exist and that the Board or Reserve Bank employee for whom access is being requested has a strong and particularized need for access to the information. All exceptions for access to Confidential Supervisory Information must be approved by the Chairman of the Board's Committee on Supervisory and Regulatory Affairs.

(6)Classified Information. Access to Classified Information is limited to those persons who are permitted access to Classified Information pursuant to the applicable executive orders and any subsequent amendments or superseding orders that the President of the United States may issue from time to time.

[71 FR 44558, Aug. 7, 2006, as amended at 73 FR 17887, Apr. 2, 2008]