§6761 Penalties

Summary

People who break certain inspection or record-keeping rules must pay civil fines or face criminal charges. A person who violates the inspection rule in section 6726 can be ordered to pay up to $25,000 for each violation, and each day the violation continues counts as a separate violation. A person who breaks the recordkeeping rule in section 6745 can be ordered to pay up to $5,000 for each violation. Before a fine is imposed, the Secretary of State must give notice and must hold a hearing if the person asks for one within 15 days. The hearing is before an administrative law judge and follows the rules in title 5, section 554. If the judge finds, by showing it is more likely than not, that a violation occurred, the judge will explain the facts and issue the order. The judge sets the penalty by looking at how serious the violation was, the harm caused, the violator’s ability to pay and keep doing business, past violations, blameworthiness, any compliance program, and other fairness factors. The judge’s decision becomes final unless the head of the United States National Authority changes it within 30 days. A final penalty can be taken out of money the United States owes the person. A person can ask for court review by filing in a U.S. Court of Appeals within 30 days in the D.C. Circuit or any circuit where they live or do business. If a person does not obey a final order, and either they did not seek review in 30 days or a court ruled against them, the Secretary of State can sue in federal district court to collect the penalty plus interest from the date the 30-day period ended or the final judgment. In that enforcement suit, the court cannot re-examine whether the final order was valid. Anyone who knowingly breaks those same rules can also be fined under title 18, imprisoned for not more than one year, or both, in addition to or instead of civil penalties.