If you transfer money internationally, you can be a little more confident that it'll get were it's supposed to go.
The Consumer Financial Protection Bureau (CFPB) has revised a rule that offers new protections. According to the agency, revisions are intended to preserve the new consumer protections provided under the rule while facilitating industry's compliance with the rule.
The rule will take effect on October 28, 2013.
"We are dedicated to protecting consumers who send money abroad and to preserving their access to these services," said CFPB Director Richard Cordray. The revisions, he says, will maintain "crucial new consumer protections while facilitating compliance for providers of remittance transfers."
'Comprehensive consumer protection'
The remittance rule creates a "comprehensive consumer protection" regime for remittance transfers sent by consumers in the United States to individuals and businesses in foreign countries. Under the rule, remittance transfer providers will be required to disclose certain fees and taxes, as well as the exchange rate that will apply to the transfer. It also provides consumers with error resolution and cancellation rights.
The new rule finalizes changes first proposed on December 31, 2012, and builds on a final rule on international money transfers that was published by the CFPB on February 7, 2012 and supplemented on August 20, 2012.
The final rule contains the following changes:
Disclosure of institution fees and foreign taxes: Remittance transfer providers must disclose certain fees, such as a provider's own fees and those charged by an agent of the provider or intermediary institution. The requirement that providers disclose foreign taxes or, if that institution is not the provider's agent, fees imposed by a recipient institution for receiving transfers into an account has been made optional. Providers must include, where applicable, a disclaimer that these fees and taxes may apply.
Errors from incorrect account information: Under the final rule, when funds are deposited into the wrong account because the sender provided an incorrect account number or routing number and certain other conditions are satisfied, the provider would be required to attempt to recover the funds but would not bear the cost of funds that cannot be recovered.
The revisions, according to CFPB, are designed to preserve market competition and consumers' access to remittance transfer services and to facilitate implementation of and compliance with the rule's requirements, while maintaining the rule's new consumer protections and ensuring that those protections can be effectively delivered to consumers.
The complete money transfer rule will take effect on October 28, 2013. The CFPB says the added time will allow entities that provide remittance transfers plenty of time to adapt to the changes.
The final rule is available here.Â
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