CFPB Sets Oct. 28 Remittance Compliance Date
As expected, the Consumer Financial Protection Bureau didn’t implement any changes credit unions were seeking to its final remittance rule, but the regulator did give remittance providers six months to comply, announcing an Oct. 28, 2013 effective date.
In the final rule issued Tuesday, remittance transfer providers will be required to disclose certain fees and taxes, as well as the exchange rate that will apply to the transfer.
The rule also provides consumers with error resolution and cancellation rights.
“We are dedicated to protecting consumers who send money abroad and to preserving their access to these services,” said CFPB Director Richard Cordray. “Today’s final rule achieves these goals by maintaining the rule's crucial new consumer protections while facilitating compliance for providers of remittance transfers.”
In August, the CFPB amended its previously released final rule to address disclosure requirements and the cost of sender errors after receiving feedback from remittance providers.
In its release Tuesday, the CFPB said the revisions will “preserve market competition and consumers’ access to remittance transfer services and to facilitate implementation of and compliance with the rule’s requirements, while maintaining the rule’s valuable new consumer protections and ensuring that those protections can be effectively delivered to consumers.”
The CFPB did not reconsider expanding the rule’s exemption to more than 100 transactions per year, although it did increase the exemption beyond the 25 transactions per yet originally proposed.
In a February webinar hosted by the NCUA, Cordray said the agency determined 100 transactions per yet to be a “normal course of business,” a term mandated by Congress in the Dodd-Frank Act.
To increase that threshold because credit unions don’t like the rule, not because they do less business than a “normal course of business,” would violate the Dodd-Frank mandate, he said.
The final rule can be found on the CFPB’s website.