On November 27, the Consumer Financial Protection Bureau (CFPB) announced that it intends to make changes to the final rule governing international remittance transfers (Regulation E, Subpart B) and delay the effective date, which was originally scheduled for February 7, 2013. This comes after numerous credit unions, state leagues and national associations voiced their concerns over the rule.
The proposed changes are:
Disclosure of third party fees and foreign taxes. The proposal would provide additional flexibility around these requirements, including by permitting providers to base fee disclosures on published bank fee schedules and by providing further guidance on foreign tax disclosures where certain variables may affect tax rates.
To accommodate the proposed changes, the CFPB must draft and publish a Notice of Proposed Rulemaking. In order for providers to adjust policies, procedures and automated systems to comply with the changes, the CFPB will delay the effective date of the final rule, which is currently February 7, 2013. The CFPB will extend the effective date of the rule to 90 days after the proposed rule is finalized, so the final effective compliance date is not known at this time.
The Missouri Credit Union Association (MCUA) believes these proposed changes are the result of effective communication of legitimate criticisms of the proposed rule by credit unions (and others) to the CFPB. On September 26, a select group of Missouri credit union representatives met with CFPB Director Cordray and other officials. Among the topics of discussion were the remittance transfer rules. In addition, MCUA, CUNA and others submitted comment letters addressing concerns with the proposed rule.
The new Notice of Proposed Rulemaking will likely be published in December. At that time, the CFPB will solicit public comment. MCUA will respond to ensure Missouri credit unions’ opinions are represented in the debate.Photo Caption: Missouri credit unions leaders meet with the CFPB on September 26.