The CFPB is seeking public feedback on a guide intended to help small firms understand and comply with the agency’s new rules for international money transfers.
The rules, scheduled to take effect on Feb. 7, 2013, implement new consumer protections under the Dodd-Frank Act. The rules require remittance transfer providers to disclose fees upfront, as well as the exchange rate and the amount to be received by the recipient. Disclosures must generally be provided when the consumer first requests a transfer and again when payment is made. The rule also provides consumers with error resolution and cancellation rights.
The CFPB said its guide may be helpful to any business that sends money internationally for consumers. The guide is intended to help institutions determine whether the transfers they send are regulated by the rule, and if so, what compliance obligations they face. For instance, the guide highlights that companies that send 100 or fewer remittance transfers a year do not qualify as remittance transfer providers and are not covered by the rule.
In determining whether a company’s remittance activities exceed the 100 transfer threshold, the CFPB said companies should remember remittances are often sent by various departments.
“You may need to identify and contact each department to determine how many remittance transfers you provide per year,” the agency wrote. The CFPB also said companies must count all types of remittance transfers covered under the rule together.
“If you sent 60 international wire transfers and 50 international ACH [automated clearing house] transactions last year, then you provided over 100 remittance transfers last year,” the agency explained.
The guide also sets forth key rule exceptions, including a temporary exception that allows insured depository institutions and credit unions to use estimates in certain disclosures.
Businesses seeking additional information on the remittance rule are encouraged to call the CFPB at: (202) 435-7700.
The CFPB asked industry participants to share their thoughts on the guide to ensure the publication is as helpful as possible.
Link to article: http://doddfrankupdate.com/DFU/ArticlesDFU/CFPB-publishes-remittance-rule-guide-for-small-bus-56328.aspx
© Copyright 2012 October Research LLC. This article is reprinted with permission from the October edition of Dodd Frank Update. Any copying or republication without the express written or verbal consent of the publisher is a violation of federal copyright laws. Daily updates concerning the Dodd-Frank Act can be accessed at www.doddfrankupdate.com.
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