On April 10, 2020, the Bureau of Consumer Financial Protection (“Bureau”) released a policy statement that during the COVID-19 pandemic it will not cite supervisory violations or initiate enforcement actions against certain remittance transfer providers related to the temporary exception to the Remittance Rule addressed in Regulation E.
The Remittance Rule provides that institutions must disclose exact costs of a remittance transfer to consumers if certain conditions are met. The Rule also provides for a temporary exception to this requirement that allows institutions to disclose estimates of the exchange rate and covered third-party fees in certain circumstances instead. This exception expires on July 21, 2020 and cannot be extended beyond this time period.
The Bureau recognizes that once the exception expires it may be burdensome for institutions during the pandemic to assess actual costs, to update its systems and procedures and to train its employees, and to enter into contractual agreements with institutions in other countries, which as a result, may cause these institutions to stop its remittance transfer operations.
In light of these burdens, the Bureau does not intend to cite an examination or initiate enforcement action in connection with the disclosure of actual costs and exchange rates for remittance transfers between July 21, 2020 and January 1, 2021.
This flexible enforcement and supervision is in hopes that remittance transfer providers will focus their time and attention to ensuring that consumers have access to these transfers and enable them to continue sending money abroad during the pandemic.