CFPB Establishes Safe Harbor to Remittance Disclosures

On Aug. 7, 2012, the Consumer Financial Protection Bureau (CFPB) released a Final Rule and Official Interpretation amending Regulation E. The long anticipated final rule modifies a final remittance transfer rule that the bureau published in February 2012.

The final supplementary rule adopts a safe harbor with respect to the phrase “normal course of business” in the definition of “remittance transfer provider.” The bureau concluded that institutions that conduct 100 or fewer remittance transfers per year do not provide transfers in the “normal course of business” and should be exempt from the remittance transfer requirements.

The CFPB has communicated that the new safe harbor provision exempts about 80 percent of credit unions that offer remittance services from the final remittance transfer rule.

The bureau’s final remittance transfer rule will take effect on Feb. 7, 2013, in conjunction with this supplementary rule. The final remittance transfer rule implements new protections under the Dodd-Frank Protection Act that require remittance transfer providers to disclose fees upfront, as well as the exchange rate and the amount to be received by the recipient.

 

Questions? Contact the Compliance Hotline: 1.800.546.4465, compliance@nwcua.org.

Posted in Around the NW, Compliance.