On November 27, 2012, the CFPB announced that it intends to propose adjustments to its rules on international remittances, as well as briefly extend the effective date of the rule. A notice of proposed rulemaking is expected in December, and the bureau stated it intends to “fast track” the rule changes so that the new implementation date will be sometime in the spring of 2013. The rules are currently slated to become effective on February 7, 2013.
In its blog post regarding these plans, the CFPB acknowledged that some entities covered by the rules have identified issues that pose “practical challenges” in implementation. The bureau’s proposed changes will address:
- Errors resulting from incorrect account numbers provided by consumers sending remittance transfers. The bureau intends to propose that where the remittance transfer provider can demonstrate that the consumer provided incorrect information, the provider must attempt to recover the funds but will not be liable for the funds if it is unable to do so.
- Disclosure of certain third party fees and foreign taxes. The bureau’s proposal will provide additional flexibility for these disclosure requirements, including allowing remittance transfer providers to base fee disclosures on published bank fee schedules. The bureau also will provide further guidance on foreign tax disclosures where tax rates may be affected by certain variables.
- Disclosure of sub-national foreign taxes. The bureau plans to propose that the obligation for remittance transfer providers to disclose foreign taxes imposed on remittance transfers is limited to taxes imposed at the national level, and does not include taxes imposed by foreign sub-national jurisdictions.
The CFPB’s bulletin regarding its plans available here, and the bureau’s related blog post is available here.