Skip to content
BOL Conferences
Page 2 of 7 1 2 3 4 5 6 7
Thread Options
#1728386 - 08/07/12 11:40 PM Re: Remittance Transfer Rule-Intl. Wires Kay
rlcarey Online
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,229
Galveston, TX
I agree.

The final rule states that if a person provided 100 or fewer remittance transfers in the previous calendar year, and provides 100 or fewer remittance transfers in the current calendar year, then the person is deemed not to be providing remittance transfers for a consumer in the normal course of its business.

No where is this limited to performing only international transfers under the 100 threshold.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
Remittance Transfer Rule
#1728427 - 08/08/12 12:03 PM Re: Remittance Transfer Rule-Intl. Wires rlcarey
PatrickG Offline
100 Club
PatrickG
Joined: Jun 2001
Posts: 165
Binghamton, NY, USA
If a remittance transfer is defined as:

(e)(1) "A “remittance transfer” means the electronic transfer of funds requested by a sender to a designated recipient that is sent by a remittance transfer provider."

and a designated recipient is defined as:

(c) “Designated recipient” means any person specified by the sender as the authorized recipient of a remittance transfer to be received at a location in a foreign country

wouldn't it mean that the 100 rule applies to remittance transfers made to persons in foreign countries?

Return to Top
#1728428 - 08/08/12 12:05 PM Re: Remittance Transfer Rule-Intl. Wires Kay
Retired DQ Offline
10K Club
Retired DQ
Joined: Dec 2002
Posts: 40,766
Turnpike Exit 10
You gotta love the CFPB's spin: crazy

Aug 7 2012
Consumer Financial Protection Bureau Makes International Money Transfers Easier for Certain Financial Institutions
Updated Rule Clarifies Process for Community Banks, Credit Unions, and other Financial Institutions

WASHINGTON, D.C. – The Consumer Financial Protection Bureau (CFPB) today updated its international money transfer rule to make the transfer process easier for institutions that handle 100 or fewer remittances a year.

“We recognize that in regulations, one size does not necessarily fit all,” said CFPB Director Richard Cordray. “The final remittance rule will protect the overwhelming majority of consumers while making the process easier for community banks, credit unions, and other small providers that do not send many remittance transfers.”

The Bureau’s final remittance rule will take effect Feb. 7, 2013. The rule implements new protections under the Dodd-Frank Wall Street Reform and Consumer 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. 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.

When the final remittance rule was released, the Bureau also published a Notice of Proposed Rulemaking seeking comment on whether to provide additional safe harbors and flexibility in applying that final rule in certain situations. The Bureau has now received those comments and has finalized the supplementary rule, which will also take effect on Feb. 7, 2013.

The Bureau concluded that those institutions that consistently conduct 100 or fewer remittance transfers per year do not provide transfers in the “normal course of business” and therefore are not subject to the new requirements. However, if a company that provided 100 or fewer remittance transfers in the previous year provides more than 100 remittance transfers in the current year, the rule provides a reasonable transition period to come into compliance.

The final rule also adjusts certain rules regarding remittance transfers that consumers schedule several days in advance of the transfer. The changes are designed to address concerns that remittance transfer providers might stop offering transfers scheduled in advance due to concerns about compliance costs under the new requirements.

Consumers transfer tens of billions of dollars from the United States to foreign countries each year. Prior to the passage of the Dodd-Frank Act, these international money transfers were generally excluded from existing federal consumer protection regulations. To remedy this, the Dodd-Frank Act expanded the scope of the Electronic Fund Transfer Act to provide protections for senders of remittance transfers.

The new Final Rule is available here: http://files.consumerfinance.gov/f/201208_CFPB_remittance_rule.pdf
_________________________
Get your facts first, then you can distort them as you please. - Mark Twain

Return to Top
#1728430 - 08/08/12 12:08 PM Re: Remittance Transfer Rule-Intl. Wires Kay
NotDoneYet Offline
Gold Star
NotDoneYet
Joined: Jul 2010
Posts: 482
PA
I agree with PatrickG. I had thought all along this proposal had to do with consumer international transfers.

Return to Top
#1728432 - 08/08/12 12:13 PM Re: Remittance Transfer Rule-Intl. Wires Kay
rlcarey Online
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,229
Galveston, TX
Well, there you go. Having not spent a lot of time on this, I guess it pays to read all the definitions blush
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#1728437 - 08/08/12 12:16 PM Re: Remittance Transfer Rule-Intl. Wires Kay
NotDoneYet Offline
Gold Star
NotDoneYet
Joined: Jul 2010
Posts: 482
PA
That's why this forum works so well. We can't be expected, except by our employers, to know every detail when all these new regulations are hitting us all at once.

Return to Top
#1728476 - 08/08/12 01:23 PM Re: Remittance Transfer Rule-Intl. Wires Kay
Matt_B Offline
Diamond Poster
Matt_B
Joined: Sep 2011
Posts: 1,648
A CU, Where Regs Don't Apply
I think we might be able to skate under the radar on this one. There was no way with the original 25, but I believe last year we did something in the 80's by the count I did. Still have to create things for monitoring and whatnot, but it would be extremely nice if we didn't end up having to actually do all the extra disclosing!
_________________________
Someone's about to get horned!

Return to Top
#1728485 - 08/08/12 01:39 PM Re: Remittance Transfer Rule-Intl. Wires Kay
#Just Jay Offline
10K Club
#Just Jay
Joined: Oct 2006
Posts: 14,390
Cheeseheadland
This is very good news!
_________________________
I don't repeat gossip, so listen closely...

Return to Top
#1728533 - 08/08/12 02:36 PM Re: Remittance Transfer Rule-Intl. Wires Kay
Still Smiling Offline
Platinum Poster
Joined: Nov 2007
Posts: 767
Do these rules apply only to "consumer" transactions?
_________________________
Comments are strictly my own and not that of my employer.

Return to Top
#1728537 - 08/08/12 02:41 PM Re: Remittance Transfer Rule-Intl. Wires PatrickG
YHWB Offline
Platinum Poster
Joined: Apr 2005
Posts: 634
Out there
So any transfer to a consumer in foreign country, not just those in a foreign currency?

Return to Top
#1728573 - 08/08/12 03:20 PM Re: Remittance Transfer Rule-Intl. Wires YHWB
CrookedVulture Offline
100 Club
Joined: Jul 2008
Posts: 148
Originally Posted By: YHWB
So any transfer to a consumer in foreign country, not just those in a foreign currency?


Any transfer from a consumer (a natural person) to a "person" in a foreign country. "Person" under Reg E meaning a natural person or an organization, including a corporation, government agency, estate, trust, partnership, proprietorship, cooperative, or association.

Return to Top
#1728576 - 08/08/12 03:22 PM Re: Remittance Transfer Rule-Intl. Wires Still Smiling
CrookedVulture Offline
100 Club
Joined: Jul 2008
Posts: 148
Originally Posted By: Still Smiling
Do these rules apply only to "consumer" transactions?


Yes, to consumer transactions that are done primarily for personal, family, or household purposes. But keep in mind the recipient can be a business and the rule may still apply.

Return to Top
#1728584 - 08/08/12 03:30 PM Re: Remittance Transfer Rule-Intl. Wires Kay
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
Has to meet all these tests to be counted:
  • Requested by an individual (the Sender)
  • Transfer for personal, family or household purposes
  • The Sender (or the sender's account funding the transfer) must be located in a State
  • The designated recipient, which may be an individual, organization, business or other entity, or the recipient's account, must not be located in a state
  • The transfer must be made electronically
  • The transfer amount in USD is more than $15.00


The types of transfers included are wire transfers, outbound ACH IAT entries, bill-pay transactions that meet the definition of EFT under subpart A of Regulation E, some prepaid access transactions, and certain other electronic transfers.

A unique example -- A U.S. bank that is owned by a Canadian bank has a consumer customer with a USD denominated account in the U.S. bank and a CAD denominated account at the "mother bank." The bank provides a service allowing the customer to move funds from one account to the other, using the bank's online banking portal. Transfers from the USD account to the CAD account will be subject to the rule, unless the amount is USD 15 or less.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#1728615 - 08/08/12 03:59 PM Re: Remittance Transfer Rule-Intl. Wires John Burnett
ahkcompliance Offline
Diamond Poster
Joined: Sep 2008
Posts: 2,474
Midwest
Originally Posted By: John Burnett
Has to meet all these tests to be counted:
  • Requested by an individual (the Sender)
  • Transfer for personal, family or household purposes
  • The Sender (or the sender's account funding the transfer) must be located in a State
  • The designated recipient, which may be an individual, organization, business or other entity, or the recipient's account, must not be located in a state
  • The transfer must be made electronically
  • The transfer amount in USD is more than $15.00


The types of transfers included are wire transfers,outbound ACH IAT entries, bill-pay transactions that meet the definition of EFT under subpart A of Regulation E, some prepaid access transactions, and certain other electronic transfers.

A unique example -- A U.S. bank that is owned by a Canadian bank has a consumer customer with a USD denominated account in the U.S. bank and a CAD denominated account at the "mother bank." The bank provides a service allowing the customer to move funds from one account to the other, using the bank's online banking portal. Transfers from the USD account to the CAD account will be subject to the rule, unless the amount is USD 15 or less.


Thanks for clarifying John. Looks like the 100 exemption will work for us. We have conducted far less than 100 international wires in last year (most are business purpose) and have not originated any IATs. We have only received 5 IAT from January 2011 to present and we do not allow our bill payment system to generate a payment outside the US.
Last edited by ahkcompliance; 08/08/12 04:00 PM.
Return to Top
#1728689 - 08/08/12 04:58 PM Re: Remittance Transfer Rule-Intl. Wires Kay
LA LA Offline
Junior Member
Joined: Nov 2008
Posts: 38
So, if a consumer customer purchases something off of the internet (like eBay) and it's paying an individual or business in a foreign country, this rule would apply. Correct?

Return to Top
#1728789 - 08/08/12 05:56 PM Re: Remittance Transfer Rule-Intl. Wires Kay
kelligirl, CRCM Offline
Member
Joined: Apr 2007
Posts: 53
In over my head
The final rule states that if a person provided 100 or fewer remittance transfers in the previous calendar year, and provides 100 or fewer remittance transfers in the current calendar year, then the person is deemed not to be providing remittance transfers for a consumer in the normal course of its business.

This may seem like a dumb question but which year are we supposed to use to determine if we qualify for the safe harbor? For example are we to use the number of transfers in 2011(previous year) and 2012(current year)or do we use the number of transfers that are made after the rule becomes effective on 2/7/13 which would make 2012 the previous year and 2013 the current year?
Last edited by kelligirl, CRCM; 08/08/12 06:06 PM.
_________________________
CRCM

Return to Top
#1728919 - 08/08/12 07:47 PM Re: Remittance Transfer Rule-Intl. Wires LA LA
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
Originally Posted By: LA LA
So, if a consumer customer purchases something off of the internet (like eBay) and it's paying an individual or business in a foreign country, this rule would apply. Correct?
Yes, but eBay is the remittance transfer provider and the onus of compliance is on them.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#1728924 - 08/08/12 07:54 PM Re: Remittance Transfer Rule-Intl. Wires kelligirl, CRCM
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
You don't need to start complying until 2013, so on 2/7/13, you consider 2012 to be the previous year and 2013 to be the current year. Analyze what you did in 2012 and what you've done so far in 2013. Check out Comments 30(f)-2.iii and -2.iv. We already have them posted to Alphabet Soup.

Here is a link.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#1728939 - 08/08/12 08:18 PM Re: Remittance Transfer Rule-Intl. Wires Kay
Still Smiling Offline
Platinum Poster
Joined: Nov 2007
Posts: 767
Could someone help me understand this...it is one of the examples in the commentary for remittance transfer? We have a prepaid program, I am just not sure I understand how you would know if the funds were being used by someone in a foreign country?

C. An addition of funds to a prepaid card by a participant in a prepaid card program, such as a prepaid card issuer or its agent, that is directly engaged with the sender to add these funds, where the prepaid card is sent or was previously sent by a participant in the prepaid card program to a person in a foreign country, even if a person located in a State (including a sender) retains the ability to withdraw such funds.
_________________________
Comments are strictly my own and not that of my employer.

Return to Top
#1729025 - 08/08/12 11:57 PM Re: Remittance Transfer Rule-Intl. Wires Kay
Jaime L Offline
New Poster
Joined: Jul 2012
Posts: 7
Warren, OH
On the CFPB's website, their summary speaks to the fact that the new rules are for payments to foreign countries.

"The Consumer Financial Protection Bureau is issuing rules to protect consumers who send money electronically to foreign countries. These transactions are called “remittance transfers.” The new rules take effect in February 2013."
_________________________
Opinions expressed are mine and not necessarily those of my employer.

Return to Top
#1729065 - 08/09/12 12:19 PM Re: Remittance Transfer Rule-Intl. Wires Still Smiling
Dani York, CRCM Offline
Power Poster
Dani York, CRCM
Joined: Apr 2005
Posts: 3,663
TN
Originally Posted By: Still Smiling
Could someone help me understand this...it is one of the examples in the commentary for remittance transfer? We have a prepaid program, I am just not sure I understand how you would know if the funds were being used by someone in a foreign country?

C. An addition of funds to a prepaid card by a participant in a prepaid card program, such as a prepaid card issuer or its agent, that is directly engaged with the sender to add these funds, where the prepaid card is sent or was previously sent by a participant in the prepaid card program to a person in a foreign country, even if a person located in a State (including a sender) retains the ability to withdraw such funds.


I haven't gotten all the way through it yet, but my understanding of the pre-paid part is that the bank only has knowledge if the bank mailed the card to the foreign address. Example--I activate a card in TN today. Tomorrow, I call and request an additional card be issued (sharing the funds on my card) and sent by the issuing bank to my brother in Germany. The additional card being sent to Germany would be covered.
_________________________
I can't herd the cats anymore, so I just set up the electric fences and let them fry when they stray out of bounds.

Return to Top
#1729229 - 08/09/12 04:18 PM Re: Remittance Transfer Rule-Intl. Wires Kay
YHWB Offline
Platinum Poster
Joined: Apr 2005
Posts: 634
Out there
So a Trust wires US dollars to Germany to pay household bills for a home maintained there for the beneficiary of the Trust. Will this be governed by the new disclsoures?

And the same situation as above, but a person requests the wire.
Last edited by YHWB; 08/09/12 04:35 PM.
Return to Top
#1729267 - 08/09/12 04:50 PM Re: Remittance Transfer Rule-Intl. Wires Kay
Retired DQ Offline
10K Club
Retired DQ
Joined: Dec 2002
Posts: 40,766
Turnpike Exit 10
I don't think so, as the trust is not a consumer...
_________________________
Get your facts first, then you can distort them as you please. - Mark Twain

Return to Top
#1729284 - 08/09/12 05:04 PM Re: Remittance Transfer Rule-Intl. Wires Kay
YHWB Offline
Platinum Poster
Joined: Apr 2005
Posts: 634
Out there
And the same wire, in US dollars requested by a client. The fact that the wire is not being sent in a foreign currency has no bearing on the coverage.

Return to Top
#1729378 - 08/09/12 06:40 PM Re: Remittance Transfer Rule-Intl. Wires Kay
YHWB Offline
Platinum Poster
Joined: Apr 2005
Posts: 634
Out there
I found this in the regualtion. Model Forms A-33 through A-35 in the new reg are expressly designed for dollar-to-dollar transfers. I beleive we became so fixed on how to handle the foreign exchange risk, that qualifer took over our thought processes!

Return to Top
Page 2 of 7 1 2 3 4 5 6 7