CFPB Modifies Final Remittance Rule to Exempt Small Banks

Posted on August 10th, 2012 in Consumer Finance, Digital Commerce, Federal Issues By BuckleySandler

On August 7, the CFPB released a final rule supplementing and modifying a previously issued rule that amends Regulation E and requires remittance transfer providers to (i) deliver written pre-payment disclosures of the exchange rates and fees associated with a transfer of funds, as well as the amount of funds the recipient will receive, and (ii) investigate consumer disputes and remedy errors. With the previous final rule, the CFPB sought comment on additional revisions that would (i) set a specific safe harbor for remittance transfer providers that do not provide such services in the “normal course of business” and (ii) apply the new disclosure and cancellation requirements in cases where the request is made several days in advance of the transfer date. In response to those comments, the modified rule now exempts institutions that do not provide transfers in the “normal course of business” if they consistently conduct 100 or fewer remittance transfers per year. The final rule also modifies several aspects of the prior rule regarding remittance transfers that are scheduled before the date of transfer, including preauthorized remittance transfers.