Do you remember Dodd-Frank 1073, which is also known as Regulation E subpart B? One of the provisions within Dodd-Frank 1073 was for the newly formed Consumer Financial Protection Bureau (CFPB) to review and adjust the disclosure requirements of consumer international transactions to provide consumers with educated information about those transfers. During the review and rulemaking process, the CFPB issued a temporary exception, also referred to as the “Safe Harbor,” for financial institutions with under 100 consumer-initiated international transfers. Time flies and this temporary exception is set to expire on July 21, 2020 and the CFPB does not have the option within its authority to extend any further. The only way the exception would continue as it reads today is if the exception is made into the law. In response to the impending expiration of the exception, the CFPB has issued a Request for Information.
The Request for Information is intended to do two things:
- Temporary Exception Expiration Questions: First, the request for information seeks information and evidence that may inform possible changes to the rule that would not eliminate but would mitigate the effects of the expiration of a statutory exception for certain financial institutions. The current temporary exception in the Remittance Rule runs to July 21, 2020 and does not authorize the Bureau to extend this term.
- Institution and Transaction Coverage Questions: In addition, the request for information seeks information and evidence related to the scope of coverage of the rule, including whether to change a safe harbor threshold in the rule that determines whether a person makes remittance transfers in the normal course of its business, and whether an exception for small financial institutions may be appropriate.
What could this mean to YOUR financial institution? If your institution currently sends less than 100 consumer-initiated international transfers (wire and/or ACH), the expiration of the exception could lead to additional disclosure responsibilities for those transactions.
The request for information was published in the Federal Register with the comment period closing on June 28, 2019. |
