The CFPB has issued a final rule that will allow it to supervise nonbank international money transfer providers that qualify as “larger participants” in the international money transfer market.  Consistent with the proposed rule, the final rule defines larger participants as those providers that engage annually in 1 million or more international money transfers.  The final rule takes effect on December 1, 2014.

The rule is based on the CFPB’s Dodd-Frank authority to supervise nonbank entities considered to be “a larger participant of a market for other consumer financial products or services.”  The rule represents the CFPB’s fourth “larger participant” rule.  It has previously finalized such rules for consumer reporting, consumer debt collection, and student loan servicing.

The rule means CFPB examiners will be able to examine nonbank international money transfer providers that qualify as larger participants for compliance with all relevant federal consumer financial laws, most notably the Electronic Fund Transfer Act and Regulation E (which includes the CFPB’s Remittance Transfer Rule which became effective on October 28, 2013) and “unfair, deceptive or abusive” standards.  For more on the rule, see our legal alert.