106 STAT. 544 PUBLIC LAW 102-325—JULY 23, 1992 against the United States for the actions or inactions of such servicers". 20 USC 1082. (b) AGENCY PROCEDURE. — Section 432 of the Act is amended— (1) in subsection (a)(3), by striking "on the record"; (2) in subsection (g)(1), by striking "on the record"; (3) in subsection (h)(2)(A), by striking out "shall, in accordance with sections 556 and 557 of title 5, United States Code," in the first sentence and inserting "shall"; and (4) in subsection (h)(3)(A), by striking out "shall, in accordance with sections 556 and 557 of title 5, United States Code," in the first sentence and inserting "shall". (c) CIVIL PENALTIES. — Section 432(g) of the Act is further amended— (1) by amending paragraph (2) to read as follows: "(2) LIMITATIONS.—No civil penalty may be imposed under paragraph (1) of this subsection unless the Secretary determines that— "(A) the violation, failure, or substantial misrepresentation referred to in that paragraph resulted from a violation, failure, or misrepresentation that is material; and "(B) the lender or guaranty agency knew or should have known that its actions violated or failed to carry out the provisions of this part or the regulations thereunder."; (2) in paragraph (3), by striking "the institution of an action tmder that paragraph" and inserting "notification by the Secretary under that paragraph"; and (3) in paragraph (4)— (A) by inserting ", and occurring prior to notification by the Secretary under that paragraph," after "guaranty agency"; and (B) by striking "or both, and the" and inserting "or both. The". (d) LS&T AUTHORITY. — Section 432(h) of the Act is amended— (1) in paragraph (2)(A), by striking "The Secretary" and all that follows through "disqualification—" in the second sentence and inserting the following: "The Secretary shall uphold the imposition of such limitation, suspension, or termination in the student loan insurance progrsun of each of the guaranty agencies under this part, and shall notify such guaranty agencies of such sanction—"; (2) in paragraph (2)(B), by striking "disqualification" each place it appears and inserting "sanction"; and (3) by redesignating subparagraph (B) of paragraph (2) as subparagraph (C), and by inserting after subparagraph (A) the following new subparagraph: "(B) The Secretary's review under this paragraph of the limitation, suspension, or termination imposed by a guaranty agency pursuant to section 428(b)(l)(U) shaHi be limited to— "(i) a review of the written record of the proceedings in which the guaranty agency imposed such sanctions; and "(ii) a determination as to whether the guaranty agency complied with section 428(b)(l)(U) and any notice and hearing requirements prescribed in regulations of the Secretary under this part.";
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