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#2236705 - 05/14/20 06:26 PM
Threshold Increased to 500
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Member
Joined: Jun 2009
Posts: 88
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The CFPB issued a Final rule to increase the threshold for remittances from 100 to 500 this week. My institution completes approximately 200 per year, so we are no longer subject to the rule. It's been a long time since we implemented this rule, so we're trying to figure out what portions of our current process that we need to retain and what we can cease from.
The 30 minute cancellation period is burdensome, so we can easily discontinue that. We currently provide a combined receipt/disclosure. If we are no longer subject to the rule, do we have any other specific disclosure requirements? Or can we simply perform the foreign wire and hand a receipt to the member? Is there anything else I'm missing?
We are rarely exempt from anything, so I'm finding it a challenge to "undo" these processes. I appreciate your guidance!
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#2236743 - 05/15/20 02:40 PM
Re: Threshold Increased to 500
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Diamond Poster
Joined: Jul 2013
Posts: 1,700
The Country
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Great question! I am also starting to look into this as we do roughly 120 per year and are excited to remove this pain in the backside.
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A successful man is one who can lay a firm foundation with the bricks others have thrown at him. -David Brinkley
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#2236745 - 05/15/20 03:12 PM
Re: Threshold Increased to 500
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Diamond Poster
Joined: Jul 2013
Posts: 1,700
The Country
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Now that I am thinking about it, I can't even remember what the requirements were before.
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A successful man is one who can lay a firm foundation with the bricks others have thrown at him. -David Brinkley
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#2236850 - 05/18/20 07:17 PM
Re: Threshold Increased to 500
RockChucker, CAMS
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Member
Joined: Jun 2009
Posts: 88
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Me either! I'm particularly concerned with the disclosure portion. It's been so long ago that I do not remember what our process was!
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#2236947 - 05/19/20 07:17 PM
Re: Threshold Increased to 500
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10K Club
Joined: Oct 2000
Posts: 40,086
Cape Cod
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If you are exempt from the rule, you are exempt. But don't leap for joy too soon. The raising of the threshold limit isn't effective until 7/21/20, so unless you were exempt as of January 1 this year and haven't done more than 100 so far, you should be complying. Then, when July 21 arrives, re-evaluate your status. If you completed fewer than 500 last year and haven't reached 500 yet this year, you can stop complying with the remittance rule requirements for any remittance requests you receive on or after July 21. See new paragraph 1005.30(f)(2)(iii) concerning transitioning into the new higher "safe harbor" exemption at https://www.bankersonline.com/regulations/12-1005-030.
Last edited by John Burnett; 05/28/20 08:36 PM.
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John S. Burnett BankersOnline.com Fighting for Compliance since 1976 Bankers' Threads User #8
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#2236971 - 05/19/20 09:16 PM
Re: Threshold Increased to 500
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Diamond Poster
Joined: Jul 2013
Posts: 1,700
The Country
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Thanks John!
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A successful man is one who can lay a firm foundation with the bricks others have thrown at him. -David Brinkley
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#2236996 - 05/20/20 02:39 PM
Re: Threshold Increased to 500
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Platinum Poster
Joined: Oct 2005
Posts: 667
Sioux Falls, SD
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Here's an interesting intersection that some of our clients have approached. They were exempt from the the rule because they had been below the 100 threshold; however, say December 1, 2019 they conduct a 101st transfer. They are no longer exempt but get up to six months to get ready to comply. No later than six months from the December, 1, 2019 date (June 1, 2020) they must comply with the current rule. (100 threshold). However, the new rule (500 threshold) doesn't kick in until July 21, 2020. So, yes, they must (technically) comply with the current (100 threshold) rule for a month and 20 days!
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#2237265 - 05/27/20 05:36 PM
Re: Threshold Increased to 500
Jerod Moyer
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Member
Joined: Jun 2009
Posts: 88
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If the error resolution procedures under 1005.33 no longer apply to us, are there any other error resolution requirements that we must abide by? It appears that 1005.3(c)(3) may exclude us from the remainder of Reg E's error resolution procedures. Am I missing something?
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#2237335 - 05/28/20 08:33 PM
Re: Threshold Increased to 500
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10K Club
Joined: Oct 2000
Posts: 40,086
Cape Cod
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Unless a remittance transfer is also an EFT under section 1005.3, your exemption under subpart B will exempt the transaction completely from Reg E coverage.
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John S. Burnett BankersOnline.com Fighting for Compliance since 1976 Bankers' Threads User #8
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#2238688 - 06/25/20 09:25 PM
Re: Threshold Increased to 500
John Burnett
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Platinum Poster
Joined: Aug 2016
Posts: 540
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So we have been well under the new 500 threshold the last two years. It is time for our Reg. E audit, so we know that starting 7-21-20 we will be exempt from the Remittance Transfer rules. Do we still need to audit for compliance at this point? So for 26 more days, we are subject to these rules, using the current 100 transfer threshold. Thoughts??? How should we approach this audit? Thanks!
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#2238698 - 06/26/20 02:20 PM
Re: Threshold Increased to 500
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Power Poster
Joined: Sep 2010
Posts: 2,658
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You might consider a limited scope audit to conduct some basic due diligence while also acknowledging that the rule is no longer going to apply.
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Adam Witmer, CRCM All statements are my opinion, not those of my employer, and should not be taken as legal advice. www.compliancecohort.com
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#2239841 - 07/20/20 04:22 PM
Re: Threshold Increased to 500
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New Poster
Joined: Aug 2019
Posts: 2
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How will banks that are subject to the new rule be able to provide an exact amount? Anyone has any ideas?
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#2239853 - 07/20/20 05:58 PM
Re: Threshold Increased to 500
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10K Club
Joined: Jul 2001
Posts: 83,219
Galveston, TX
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Exact amount? Number of transactions you mean?
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The opinions expressed here should not be construed to be those of my employer: PPDocs.com
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#2239882 - 07/20/20 10:46 PM
Re: Threshold Increased to 500
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Diamond Poster
Joined: Apr 2013
Posts: 2,199
The West
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Brandon248,
You count them??? You should be able to generate a report from your core/wire system.
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TryingToComply CRCM
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#2239894 - 07/21/20 01:40 PM
Re: Threshold Increased to 500
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New Poster
Joined: Aug 2019
Posts: 2
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Perhaps I'm interpreting this rule incorrectly, but the way I understand it an "exception that allows insured institutions to disclose estimates instead of exact amounts to consumers" expires today. Now another exception has been made due to the pandemic and I believe it basically gives until Jan 1st 2021 before institutions will be penalized for non compliance. My question is how can financial institutions give an exact amount instead of an estimate of how much it'll cost end to end and exactly how much the recipient of the transfer will receive? https://www.consumerfinance.gov/pol...ectronic-fund-transfer-act-regulation-e/
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#2239964 - 07/22/20 03:09 PM
Re: Threshold Increased to 500
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10K Club
Joined: Oct 2000
Posts: 40,086
Cape Cod
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I suggest you go back and re-read new sections 1005.32(b)(4) and (b)(5), which may allow you to estimate (1) the exchange rate and any amount computed using the exchange rate and/or (2) covered third-party fees and amounts affected by those fees (such as the amount to be received by the designated recipient).
The criteria for these exceptions are complicated and require you to have kept track of where your remittance transfers from depositors' accounts have been sent each year on a pretty granular basis (by destination country and institution).
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John S. Burnett BankersOnline.com Fighting for Compliance since 1976 Bankers' Threads User #8
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#2240516 - 07/31/20 09:49 PM
Re: Threshold Increased to 500
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100 Club
Joined: Nov 2008
Posts: 129
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My bank will be exempt to the remittance rule due to the change. We have less than 500 per year. Are there disclosure requirements to the customer? Thank you!
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#2240520 - 08/03/20 02:10 PM
Re: Threshold Increased to 500
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10K Club
Joined: Oct 2000
Posts: 40,086
Cape Cod
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None. Remember that the sending of a foreign remittance transfer does not by itself create a customer relationship. That's why all of the disclosure requirements in subpart B of Regulation E are transaction-related, not account related.
That said, it would be a good idea to review any printed material or website mentions related to remittance transfers. You don't need to trash them (if you are still offering the service), but check to ensure you aren't providing any misleading info or referring to receipts or disclosures you aren't planning to provide.
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John S. Burnett BankersOnline.com Fighting for Compliance since 1976 Bankers' Threads User #8
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#2240551 - 08/03/20 06:42 PM
Re: Threshold Increased to 500
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100 Club
Joined: Nov 2008
Posts: 129
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Thank you so much for your response!
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#2240556 - 08/03/20 07:13 PM
Re: Threshold Increased to 500
Questions
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10K Club
Joined: Oct 2000
Posts: 40,086
Cape Cod
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Welcome to BOL's discussion forums!
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John S. Burnett BankersOnline.com Fighting for Compliance since 1976 Bankers' Threads User #8
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