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#2098775 - 09/15/16 09:10 PM Receipt When Payment is Made
Mass14 Offline
New Poster
Joined: Oct 2008
Posts: 16
MA
We just had to comply with the Remittance Transfer Rule this year. We provide a combined disclosure as required and a receipt is generated from the system we use showing that the funds are being held for a one time transfer that say will take place in the morning. We provide this receipt to the sender as proof of payment and feel this satisfies the requirements.
The official interpretations say for purposes of Subpart B, payment is made when a sender provides cash to the remittance transfer provider or when payment is authorized.
We were just told by a consultant that our receipt is not acceptable for the transfer has not taken place yet and a receipt must be generated and provided to the sender after the transfer has actually taken place to meet the requirements.

Are we correct in how we are interpreting the reference in Subpart B of when a payment is made?

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Remittance Transfer Rule
#2098989 - 09/16/16 08:41 PM Re: Receipt When Payment is Made Mass14
John Burnett Offline
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John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
I regret to inform you that you consultant is mistaken. The receipt must be given at time of payment, which means when you get paid or get permission to charge the Sender's account.

Tell the consultant to read section 1005.31(e)(2) and comment 31(e)-2 of the regulation.

Perhaps I should bill him or her for this information.
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John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

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#2162677 - 01/31/18 10:44 PM Re: Receipt When Payment is Made Mass14
maggie Offline
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Joined: Aug 2017
Posts: 10
John,

Is there an issue with getting the permission to charge the sender's account but not actually charging the account until a few hours later? Our concern is: if we tell the customer authorization for the payment was made at 12 but don't actually memo the account until 2, are we would be liable if for some reason the money was no longer available when we made the memo debit.

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#2162783 - 02/01/18 07:25 PM Re: Receipt When Payment is Made Mass14
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
The solution is to memo post the debit or place a hold on your system at the time you get the OK to charge the account. If you wait until later and the funds disappear before you charge the account for the transfer, you've shot yourself in the foot.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

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