WASHINGTON (4/20/12)--Credit union concerns regarding the Consumer Financial Protection Bureau's (CFPB) remittance transfer regulations were laid out at a symposium held this week in Washington, as the Credit Union National Association (CUNA) underscored that credit unions continue to have many compliance concerns regarding the remittance transfers final rule, especially with "open network" transfers.
CUNA also raised its continuing opposition to the rule with senior CFPB staff in a meeting at CUNA April 18.
The day-long symposium was hosted by Appleseed Network, a public interest group that advocated for strong consumer protections on remittance transfers. Staff from CUNA, the World Council of Credit Unions and the National Federation of Community Development Credit Unions were among those in attendance. Representatives from other financial associations, payment companies, law firms, non-profits, and consumer groups also took part in the symposium.
A new remittance rule that was adopted by the CFPB earlier this year would require remittance transfer providers to disclose the exchange rate, all fees associated with a transfer, and the amount of money that will be received on the other end. Remittance transfer providers will also be required to investigate disputes and fix mistakes. The rule will become effective on Feb. 7, 2013, and will impact U.S.-based credit unions that provide consumers with international electronic funds transfer services.
During the symposium, CUNA Regulatory Counsel Dennis Tsang said CUNA continues to support regulatory flexibility that would allow credit unions to continue to offer remittances and complement the many financial services and financial literacy programs that credit unions provide to consumers and communities.
Tsang added that the final remittance rule would impose unsustainably high compliance costs and legal liabilities on credit unions that provide transfers through "open networks," such as international wire transfers and international automated clearing house transfers through unrelated correspondent institutions. CUNA has called for "meaningful relief" from the remittance rules, and continues to discuss this and other remittance issues with CFPB staff. (See related April 10 News Now story: Some CUs could be forced out of remittances: CUNA)
The meeting also featured discussions on the final rule's requirements with CFPB staff, compliance and new disclosure changes, and future developments on remittance transfers and research.