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Joint Trades Comment Letter to CFPB re Remittance Rule Assessment RFI
May 23, 2017
Via Electronic Delivery
Monica Jackson, Office of the Executive Secretary
Consumer Financial Protection Bureau
1700 G Street NW, Washington, DC 20552
Re: Docket No. Bureau–2017–0004; Request for Information Regarding Remittance Rule Assessment
Dear Ms. Jackson:
The Clearing House Association L.L.C. (“The Clearing House”), the Consumer Bankers Association (“CBA”), the Bankers Association for Finance and Trade (“BAFT”) , and the American Bankers Association (“ABA” )1, collectively referred to herein as the “Associations,” respectfully submit this comment letter to the Consumer Financial Protection Bureau (the “Bureau”) in response to the Bureau’s notice and request for information (“RFI”) regarding its planned assessment of regulations pertaining to consumer remittance transfers under the Electronic Fund Transfer Act (subpart B of Regulation E) (the “Remittance Rule” or the “Rule”).2
The Associations appreciate the opportunity to provide recommendations for ensuring that the Remittance Rule achieves it purpose of protecting consumer-senders of remittance transfers while reducing compliance burdens on providers of those services. To that end, the Associations strongly support the Bureau’s intent to include as part of the assessment process a review of sender and provider experience data, both statistical and empirical.
I. Executive Summary of the Associations’ Comments and Recommendations
The Associations provide comments herein with respect to both (a) the methodology of the Bureau’s Remittance Rule assessment plan, as described in the RFI; and (b) provisions of the Rule that the Associations would encourage the Bureau to retain, eliminate, modify or clarify. Regarding the assessment process, we encourage the Bureau to consider developing a “Remittance Rule Impact Survey” that could be used as a tool for the Bureau in its information gathering efforts. This survey could facilitate organized data collection, and better enable data comparison across remittance transfer providers. We also suggest that the Bureau incorporate a cost/benefit analysis, from both the sender and provider perspective, when comparing current remittance transfer transactions against a “baseline” transaction that would have occurred prior to adoption of the Remittance Rule.
With regard to specific Rule provisions, the recommendations of the Associations discussed below include:
- preserving the ability of depository institutions to provide estimates of third party fees and exchange rates (rather than actual fees and rates) in connection with remittance transfers to countries for which obtaining exact data is operationally not feasible;
- modifying the scope of the Rule by (i) excluding transfers in excess of a certain dollar amount, and (ii) excluding from coverage those transfers effectuated through reloadable prepaid cards;
- modifying disclosure requirements by (i) permitting senders more flexibility in selecting preferred delivery mechanisms, (ii) eliminating redundant disclosures to senders making concurrent, multiple transfers by phone, and (iii) simplifying the disclosures necessary for pre-scheduled transfers;
- modifying cancellation and resend rights by (i) eliminating the 30 minute cancellation window in lieu of a right to cancel prior to a provider’s execution of transfer; and (ii) limiting error resolution remedies to a refund (rather than a resend request) when the error results from sender error, involves an amount less than $15, or does not impact the amount of funds received by the designated recipient; and
- modifying the Rule’s error resolution provisions by holding the sender, and not the provider, responsible for transaction costs resulting from sender error.