Skip to content
BOL Conferences

Page 2 of 2 1 2
Thread Options
#1755281 - 11/06/12 11:02 AM Re: remittance transfer exemption Baker
Compliance504 Offline
Platinum Poster
Joined: Dec 2008
Posts: 731
Tennessee
We do not want to offer remittance transfers any longer; however we do want the option to continue servicing some of our customers who have relied on this service and be able to honor requests of other customers that Mgmt would like to keep happy….we realize that to do this we need to make sure we are at 100 or below by Dec 31 2012 and that we monitor our count through 2013 to make sure we are under the Safe Harbor threshold.

Unfortunately, we have made this decision rather late in the year and just removed the service from our fee schedule and have notified branch managers that we will only do these upon request for our "very best" customers. We are pushing close to the 100 mark for this year…Mgmt is aware that if we go over 100 by the end of this year, after Feb 13 we will not be able to provide this service upon request for anyone unless we are in compliance. But a thought has occurred to me….to qualify for the safe harbor you must not offer the service in our routine course of business….If we have it thoroughly documented that we have made the decision to no longer offer this service in our routine course of business and have removed the service from our fee schedule but go over the 100 threshold by a few this year by honoring only "special" requests, would the safe harbor still apply for next year?

Thanks in advance...

Return to Top
Operations Compliance
#1755283 - 11/06/12 11:59 AM Re: remittance transfer exemption Baker
Kathleen O. Blanchard Offline

10K Club
Kathleen O. Blanchard
Joined: Dec 2000
Posts: 21,293
If you review Reg E you will see that normal courseof business is dfined as less than 100 In previous and urrent calendar yer.
_________________________
Kathleen O. Blanchard, CRCM "Kaybee"
HMDA/CRA Training/Consulting/Mapping
The HMDA Academy
www.kaybeescomplianceinsights.com

Return to Top
#1755380 - 11/06/12 03:14 PM Re: remittance transfer exemption Baker
Compliance504 Offline
Platinum Poster
Joined: Dec 2008
Posts: 731
Tennessee
Thanks so much Kathleen...just making absolutely sure about some things....

Return to Top
#1755628 - 11/06/12 08:33 PM Re: remittance transfer exemption Baker
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
Actually, you could be on to something. The "safe harbor" provision is just that. You don't have to be concerned about whether you offer the service in the normal course of business. If you don't qualify for the safe harbor, the definition of "remittance transfer provider" says whether your bank is one becomes a matter of facts and circumstances. You might attempt to argue that because you don't offer the service except in very limited cases, you aren't offering the service in the normal course of business, and won't be subject to the rule.

However, it leaves you open to the risk that an examiner will say that his interpretation of "facts and circumstances" qualifies you for the definition. It's a poorly-crafted definition because it leaves too much to interpretation, and it's usually the case that where there is doubt, things get construed in favor of the consumer.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#1755719 - 11/06/12 10:04 PM Re: remittance transfer exemption John Burnett
Compliance504 Offline
Platinum Poster
Joined: Dec 2008
Posts: 731
Tennessee
I know that staying under 100 would not spark any argument with examiners as that is spelled out in the Reg and we are planning to keep them under 100 as we will no longer offer them. However, we would still like to be able to accommodate "special" customers through the end of this year and into next year. I'm afraid if we honor some requests this year, we may go over 100 and not qualify for the safe harbor which means beginning in Feb we could not accommodate any customers unless we are in full compliance...we will not have the 6 month window to comply if we do in fact reach a 101st transaction this year....

So we could still accommodate some customers this year, I was hoping some kind of argument could be made if we do go over 100....because we in fact made the decision to no longer offer the service and will only accommodate some customers on a limited basis.

I know we should have monitored this way before now...but we didn't....honestly based on a review from last year we thought we would be well within the safe harbor limit...but this years figures are telling a much different story....apparently other banks in the area raised their wire fees and we've had an influx because our fees remained comparitively low....

Thanks for your input, John....

Return to Top
#1755734 - 11/06/12 10:21 PM Re: remittance transfer exemption Baker
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
When counting to 100 (are we playing "hide and seek"?) did you only count transactions by consumers to be paid in a foreign location and for a consumer purpose?
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#1755755 - 11/06/12 11:17 PM Re: remittance transfer exemption Baker
Compliance504 Offline
Platinum Poster
Joined: Dec 2008
Posts: 731
Tennessee
I'm not sure what you mean by hide and seek...

I reviewed international wires that were sent through our correspondent bank that transmits these wires on our behalf. I identified entries listed as individual names, then reviewed the the copy of the wire transfer form used to process the transaction for the wire's purpose....

If a business was logged I did not further review those transactions.

I'm pretty sure I've counted correctly....

Return to Top
#1755765 - 11/06/12 11:28 PM Re: remittance transfer exemption Baker
Compliance504 Offline
Platinum Poster
Joined: Dec 2008
Posts: 731
Tennessee
Would help if I said what I counted...I only counted the ones logged as individuals that appeared to have consumer purpose on the wire form....

Hope that's right...

Return to Top
#1755809 - 11/07/12 01:51 PM Re: remittance transfer exemption Baker
waldensouth Offline
Power Poster
waldensouth
Joined: Nov 2001
Posts: 7,988
FINALLY ABOVE the gnat line
We also looked at the type of account the funds were coming from - if from a business account, then we counted that as business purpose. Some sole proprietors may send wires for business purposes.
_________________________
"Once you learn to read, you will be forever free."

- Frederick Douglass




My Opinion Only.

Return to Top
#1755825 - 11/07/12 02:16 PM Re: remittance transfer exemption Compliance504
Compliance504 Offline
Platinum Poster
Joined: Dec 2008
Posts: 731
Tennessee
I had another thought....I understand that the Safe Harbor Test for determining whether you are conducting remittance transfers in the normal course of business is...

100 previous year AND 100 current year....

Since we have removed this service and will only be doing a very limited only as courtesy for a very few....we should NOT go over 100 next year (which would be the current year)

So it really doesn't matter how many we have on Dec 31 2012....if we do go over 100 but are for sure under 100 in 2013 we're ok....


IF we did reach the 101st in 2013 (we shouldn't but planning for the worst), then we would have 6 months to comply....

Am I understanding correctly...or is there some fault in the logic I'm not seeing....

Thanks in advance....
Last edited by Compliance504; 11/07/12 02:29 PM.
Return to Top
#1755873 - 11/07/12 03:18 PM Re: remittance transfer exemption Compliance504
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
"Hide and seek" was a tongue-in-cheek reference to "counting to 100." No more, no less.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#1755882 - 11/07/12 03:25 PM Re: remittance transfer exemption Baker
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
Compliance 504:

Because the "safe harbor" is available only if you have 100 or fewer remittance transfers in both the previous year and in the current year, it would not help you, at least not during 2013. On 2/7/13, when the rule becomes effective, you'd be ineligible for the safe harbor exemption if you exceeded 100 in 2012. So, unless you can demonstrate that you do not provide remittance transfer services in the normal course of business (using the "facts and circumstances" test, which has never been defined), you'll have to comply during 2013.

If you manage to stay at or under 100 for 2013, you should qualify for the safe harbor exemption starting on 1/1/2014, unless you hit 101 transactions in 2014, at which time you'd start a 6-month transition period.
Last edited by John Burnett; 11/07/12 03:26 PM.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#1756141 - 11/07/12 06:50 PM Re: remittance transfer exemption Baker
Compliance504 Offline
Platinum Poster
Joined: Dec 2008
Posts: 731
Tennessee
Thanks for making that very clear to me, John....

I was hoping the hide and seek was something unrelated...I thought maybe you thought I was trying to hide something to avoid complying with the rule...I've been cramming on this Reg and getting myself confused...which I'll admit is not hard to do at times....

Thanks, again...

Return to Top
#1756287 - 11/07/12 11:57 PM Re: remittance transfer exemption Compliance504
Buddy the Elf Offline
Platinum Poster
Buddy the Elf
Joined: May 2002
Posts: 975
first lily pad on the right
Originally Posted By: Compliance504
...have notified branch managers that we will only do these upon request for our "very best" customers.


Is there a risk of discrimination if the "very best" customers are of a certain race or live in a particular area? What criteria is used to determine "very best"? I'm curious because we had this discussion here and decided against it because we were worried about discrimination issues.
_________________________
CAMS

Return to Top
#1756510 - 11/08/12 07:33 PM Re: remittance transfer exemption Baker
Compliance504 Offline
Platinum Poster
Joined: Dec 2008
Posts: 731
Tennessee
Justin Case....I would be interested in what others have to say about the issue you have raised...

Return to Top
#1756970 - 11/09/12 07:59 PM Re: remittance transfer exemption Baker
Slowpanic Offline
100 Club
Slowpanic
Joined: Mar 2010
Posts: 119
USA
I would be worried about the "very best" designation. Are only those customers with high balances "very best"? How will this be determined? I could see many opportunities for someone to cry foul.

Return to Top
#2079225 - 05/18/16 06:29 PM Re: remittance transfer exemption Baker
Norman Paperman Offline
Diamond Poster
Norman Paperman
Joined: Aug 2012
Posts: 1,710
48.934476, -114.343735
Redacted - figured it out.
Last edited by Norman Paperman; 05/18/16 08:26 PM. Reason: redacted
_________________________
Maybe you just wanna fly the plane yourself. Well good luck pressing take off, then auto pilot, then land.


CRCM

Return to Top
Page 2 of 2 1 2

Moderator:  Andy_Z, John Burnett