Remittance Transfers

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The Remittance Transfer Rule (“Remittance Rule”), Subpart B of Regulation E, 12 C.F.R. §§ 1005.30 to 1005.36, requires transfer providers to provide prepayment disclosures to consumers prior to paying for a remittance transfer. U.S. Senators Elizabeth Warren (D-Mass.),Dianne Feinstein (D-Calif.), Brian Schatz (D-Hawaii), Jack Reed (D-R.I.), and Alex Padilla (D-Calif.) sent a letter to CFPB Director Rohit Chopra to request that the Remittance Rule be modified to require transfer providers to disclose the true cost of remittance payments so consumers can comparison shop.… Continue Reading

On October 4, 2022, the Consumer Financial Protection Bureau (CFPB) entered into a consent order with Choice Money, a New York nonbank remittance transfer provider involving violations of the Remittance Transfer Rule (“Remittance Rule”), Subpart B of Regulation E, 12 C.F.R. §§ 1005.30 to 1005.36, and the Consumer Financial Protection Act.… Continue Reading

The CFPB has released the Spring 2022 edition of its Supervisory Highlights.  The report discusses the Bureau’s examinations in the areas of auto servicing, consumer reporting, credit card account management, debt collection, deposits, mortgage origination, prepaid accounts, remittance transfers, and student loan servicing that were completed between July 2021 and December 2021. … Continue Reading

The CFPB and the New York Attorney General have filed a lawsuit in a New York federal district court against MoneyGram International, Inc. and MoneyGram Payment Systems, Inc. (MoneyGram) in which they allege that MoneyGram violated the Remittance Transfer Rule (Remittance Rule), other provisions of Regulation E, the CFPA, and New York Executive Law.… Continue Reading

Last week, by a vote of 218-208, the House of Representatives passed the resolution introduced by Democratic Senators under the Congressional Review Act (CRA) to overturn the OCC’s “true lender” final rule.  The rule addresses when a national bank or federal savings association should be considered the “true lender” in the context of a partnership with a third party. … Continue Reading

The California Department of Financial Protection and Innovation announced last week that it has entered into a consent order with Lambda, Inc., which does business as Lambda School, to settle the DFPI’s claims that a provision in Lambda’s student financing contracts was misleading.  The consent order also resolves the DFPI’s claim that Lambda’s marketing materials were misleading. … Continue Reading

On December 21, 2020, the CFPB issued its third consent order involving violations of Subpart B of Regulation E, 12 C.F.R. §§ 1005.30 to 1005.36, the Remittance Transfer Rule (“Remittance Rule”) in the last four months and fourth order since August 2019. This most recent consent order was issued against Envios de Valores La Nacional Corp.… Continue Reading

The CFPB has issued a final rule amending its remittance rule.  The final rule is effective July 21, 2020.

The key amendments consist of the following:

  • Safe harbor threshold.  Currently, the rule’s safe harbor threshold removes from the rule’s coverage an entity that provided 100 or fewer remittance transfers in the previous calendar year and provides 100 or fewer remittance transfers in the current calendar year. 
… Continue Reading

The CFPB has issued a policy statement regarding its approach to supervision and enforcement of remittance transfers during the COVID-19 pandemic.

The EFTA, as implemented by the CFPB’s remittance rule, provides insured depository institutions with a temporary exception that allows them, under certain conditions, to disclose estimates of the exchange rate and covered third-party fees instead of exact amounts. … Continue Reading

The CFPB has entered into a settlement to resolve the lawsuit filed against it in May 2019 seeking a declaration that the CFPB’s failure to issue regulations implementing Section 1071 of the Dodd-Frank Act violates the Administrative Procedure Act and an order requiring the Bureau to promptly issue such regulations.  The plaintiffs in the lawsuit, which was filed in a California federal district court, are the California Reinvestment Coalition, the National Association for Latino Community Asset Builders, and two individual small business owners.… Continue Reading