I have a question for the correct way to handle a combined disclosure. There is an FI in the area that is handling remittance transfers in a way that I believe is not compliant with Reg-E. I was hoping someone could give me some feedback.
Process for remittance transfer:
1) Customer comes into branch and requests remittance transfer
2) FI inputs wire and debits customer’s account
3) Funds from customer are held in a general ledger for 30 minutes
4) FI provides customer with a “combined disclosure†with the receipt portion completed, showing they paid for the wire. This is the first and only disclosure the customer gets.
5) Customer signs disclosure and leaves
6) Once 30 minutes has elapsed, funds are released from the general ledger to the FI’s international wire processor.
The requirement for a pre-payment disclosure, whether part of a combined disclosure or not, in my opinion is not being met here. The FI argues that the wire is not paid for when the customer’s account is debited because they don’t’ actually release the wire until after 30 minutes has expired; they argue that the wire is paid for when the funds are released to the wire processor.
This logic seems to contradict itself in that a Receipt “…must be provided to the sender when payment is made for the remittance transfer.†On one hand the FI states the wire is not paid for (so their combined disclosure acts as a pre-payment disclosure) and on the other they say it is paid for (so their combined disclosure is a receipt).
Does this make sense to anyone else? Am I being too literal in my translation of the remittance rules?