International Money Transfers

Posted By: Al Miller

International Money Transfers - 08/07/12 05:39 PM

CFPB Press Release:

http://www.consumerfinance.gov/pressrele...l-institutions/

The proposed de minimus has been set at 100 per year.

Al
Posted By: John Burnett

Re: International Money Transfers - 08/07/12 08:02 PM

Thanks, Al, for the heads up. Someone was asking about this this morning.

Thanks to your early notice, I've managed to updated the BOL Alphabet Soup version of the regulation with all the changes.
Posted By: ahou

Re: International Money Transfers - 08/07/12 08:07 PM

Thanks Al and John. You're so efficient and much appreciated.
Posted By: SUSANE1

Re: International Money Transfers - 08/08/12 02:16 PM

so the de minimus means banks with fewer than 100 wires will be exempt from the rule?
Posted By: John Burnett

Re: International Money Transfers - 08/08/12 02:28 PM

The de minimis (note spelling) provision will mean that a bank with 100 or fewer remittance transfers of all types (wires, IATs, qualifying bill payments, etc.) in 2012 and 100 or fewer in 2013 will not be subject to subpart B requirements. If, in 2013 (or any subsequent year), it conducts the 101st remittance transfer for that year, it becomes subject to the rule, but has a 6-month compliance grace period. So, for example, if your bank does 100 or fewer remittance transfers in 2012, and conducts its 101st remittance transfer for 2013 on August 1, 2013, it will have until February 1, 2014, to begin complying (assuming it continues to be a remittance transfer provider).
Posted By: SWFLBanker

Re: International Money Transfers - 08/08/12 03:00 PM

Does the de minimis only count consumer wires, or do we include wires for business purpose in that count as well. I know all types of wires but Reg E is a consumer Reg. Most of our wire activity is business related, but if we count those we do more then 100 wire transfer per year. I appriciate anyone's opinion.
Posted By: devsfan

Re: International Money Transfers - 08/08/12 03:04 PM

This is pretty mind-boggling to me. How can a bank be expected to disclose the fees that intermediary banks in the payment chain will deduct from the wire amount and also the exchange rate applied by the beneficiary's bank?
Posted By: CrookedVulture

Re: International Money Transfers - 08/08/12 03:10 PM

Originally Posted By: devsfan
This is pretty mind-boggling to me. How can a bank be expected to disclose the fees that intermediary banks in the payment chain will deduct from the wire amount and also the exchange rate applied by the beneficiary's bank?


They can't be, and yet, the rule exists. crazy
Posted By: devsfan

Re: International Money Transfers - 08/08/12 03:13 PM

So how are we all going to comply, and how will that change our fees?
Posted By: CrookedVulture

Re: International Money Transfers - 08/08/12 03:27 PM

Originally Posted By: devsfan
So how are we all going to comply, and how will that change our fees?


That's the million dollar question.
Posted By: John Burnett

Re: International Money Transfers - 08/08/12 03:52 PM

The ABA has asked Congress to delay the effective date for two more years for many of the reasons noted in this thread. We'll see if they have any success. Even with the temporary estimate provision, it's gonna be a bear.
Posted By: devsfan

Re: International Money Transfers - 08/08/12 04:12 PM

Congress hasn't done anything useful in quite some time so we should not expect any relief, but it would be nice since I should be retired by then.
Posted By: waldensouth

Re: International Money Transfers - 08/08/12 06:54 PM

What public policy issue was being addressed/solved by this regulation?
Posted By: Jerseygirl

Re: International Money Transfers - 08/10/12 02:05 PM

As Jennawer was wondering - I too am trying to figure out if the 100 applies to consumer transactions as Reg E is a consumer reg or do we count our business activity?
Posted By: Elwood P. Dowd

Re: International Money Transfers - 08/10/12 02:22 PM

The disclosures (and thus the threshold count) would only apply to consumer transactions.

Complaining here is understandable, but ineffective. Either write to the Pollyanna Agency (CFPB), discontinue the service, or contact Western Union about being an agent.
Posted By: HR Banker

Re: International Money Transfers - 08/10/12 02:47 PM

Originally Posted By: John Burnett
The de minimis (note spelling) provision will mean that a bank with 100 or fewer remittance transfers of all types (wires, IATs, qualifying bill payments, etc.) in 2012 and 100 or fewer in 2013 will not be subject to subpart B requirements.


Is this meaning 100 or fewer foreign wires or 100 wires, etc. no matter where they went?

We only had 1 foreign wire last year.
Posted By: Kathleen O. Blanchard

Re: International Money Transfers - 08/10/12 02:47 PM

100 or fewer foreign consumer purpose wires.
Posted By: Elwood P. Dowd

Re: International Money Transfers - 08/10/12 02:52 PM

Note the quote...not just wires.

Epiphany: Every bank will need to count all the little puppies to prove it does not apply. Examiners with nothing else to write about will say they should have compliance procedures in place in case they do cross the threshold.

Big fun!
Posted By: StevenD

Re: International Money Transfers - 08/10/12 06:37 PM

Note: you have six months to be in compliance once you cross that threshhold.
Posted By: HR Banker

Re: International Money Transfers - 08/10/12 06:40 PM

OK, still checking. We only did 1 foreign wire, our core processor says they don't do bill pay outside the US so I think I'm down to finding out about foreign ACH, right?
Posted By: John Burnett

Re: International Money Transfers - 08/10/12 06:57 PM

Yup, and it's only outbound IATs that you'll have to look for. If you don't allow your customers do make them....
Posted By: HR Banker

Re: International Money Transfers - 08/10/12 07:41 PM

OK the question came up concerning Paypal. Our customer buys something from someone in Japan and pays through paypal. Since the money is going from us to paypal and then they send it on does that actually count as us sending it out of the country?
Posted By: BrianC

Re: International Money Transfers - 08/10/12 09:56 PM

In those instances, Paypal is the originator, and it's bank the ODFI. As the RDFI, these transactions would not count towards your 100.
Posted By: John Burnett

Re: International Money Transfers - 08/13/12 12:38 PM

Start by asking yourself whom did your customer ask/authorize to move the funds? In this case, it's PayPal, so your bank is not the remittance transfer provider.
Posted By: zitch70

Re: International Money Transfers - 08/14/12 12:42 PM

Does Paypal have to comply with this mess? If not then why not direct all our consumers to use Paypal or Western Union for their foreign transfers.
Posted By: Bank Compliance

Re: International Money Transfers - 08/14/12 05:43 PM

I know this has kinda been asked above- but when I read the definition of remittance transfer- it does not say anything about it being a foreign transactions- therefore- I am wondering if in the safe harbor do we count ALL remittance transfers or JUST foreign?!

Just looking for clarification on the safe harbor.
Posted By: John Burnett

Re: International Money Transfers - 08/14/12 05:53 PM

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.

As with all definitions, you have to look for terms that are also defined Some suspects are underlined in the definition above.

In this case, the key definition is "designated recipient," which is defined as "any person specified by the sender as the authorized recipient of a remittance transfer to be received at a location in a foreign country."

Therefore, "remittance transfer" only includes transfers to be received at a location in a foreign country.

Now you can start counting.
Posted By: Bank Compliance

Re: International Money Transfers - 08/14/12 05:56 PM

Thank you! I knew I had to have been missing something!! smile
Posted By: tdogz

Re: International Money Transfers - 08/14/12 06:16 PM

Originally Posted By: John Burnett
In this case, the key definition is "designated recipient," which is defined as "any person specified by the sender as the authorized recipient of a remittance transfer to be received at a location in a foreign country."

And continuing the theme of having to look up words within the definition of another word to determine what they are really saying:

"Person means a natural person or an organization, including a corporation, government agency, estate, trust, partnership, proprietorship, cooperative, or association."

One would think that a person is, well, a person... but not in Reg E.
Posted By: John Burnett

Re: International Money Transfers - 08/14/12 06:34 PM

Actually, "person" in the legal sense of the word (which you've described) is used in several regulations. Just one example is the use of the phrase "person on whose behalf" a transaction is conducted in connection with a CTR.
Posted By: HR Banker

Re: International Money Transfers - 08/16/12 06:18 PM

Do regular debit card purchases count? My first thought was that we were only talking about wires and then I went on to foreign ACH & bill pay. If I go to the website of a store in Europe and purchase directly from that store online with my debit card is that a foreign remittance transfer? What about if I am in Europe and use my debit card? The money has to come from my bank in the US so does that count?
Posted By: BrianC

Re: International Money Transfers - 08/16/12 06:23 PM

No, it does not count. In those cases, the funds are being drawn out of the account via V/MC. The issuing bank does not initiate these transfers.