The Consumer Financial Protection Bureau (CFPB) recently published what will hopefully be the final revisions to its remittance rules. The final revised rule will take effect on October 28, 2013.
The remittance rules create a comprehensive consumer protection regime for remittance transfers sent by consumers in the United States to individuals and businesses in foreign countries. Under the remittance rule, remittance transfer providers will be required to disclose certain fees and taxes, as well as the exchange rate that will apply to the transfer. The rule also provides consumers with error resolution and cancellation rights.
The CFPB made the following changes in the final rule:
- Disclosure of institution fees and foreign taxes: Remittance transfer providers must disclose certain fees, such as a provider’s own fees and those charged by an agent of the provider or intermediary institution. The requirement that providers disclose foreign taxes or, if that institution is not the provider’s agent, fees imposed by a recipient institution for receiving transfers into an account has been made optional. Providers must include, where applicable, a disclaimer that these fees and taxes may apply.
- Errors from incorrect account information:Â Under the final rule, when funds are deposited into the wrong account because the sender provided an incorrect account number or routing number and certain other conditions are satisfied, the provider would be required to attempt to recover the funds but would not bear the cost of funds that cannot be recovered.
The CFPB’s revisions are designed to preserve market competition and consumers’ access to remittance transfer services and to facilitate implementation of and compliance with the rule’s requirements, while maintaining the rule’s new consumer protections and ensuring that those protections can be effectively delivered to consumers.
A copy of the revised rule is available here.