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Cornerstone Comments on CFPB's Remittance Rule Assessment
Wednesday, May 24, 2017 6:30 AM

Cornerstone Credit Union League has sent a comment letter to the Consumer Federal Protection Bureau regarding its assessment of the remittance transfer rule.

"Unfortunately, CFPB's efforts to protect consumers have often resulted in unintended consequences that ultimately negatively impact consumers through higher pricing or fewer choices," wrote Cornerstone SVP Regulatory Compliance Counsel Suzanne Yashewski. "The remittance rule is the perfect example of this. Since the remittance rule was issued in 2012, most credit unions have ceased offering remittance services to their members. The cost of compliance is simply too high, and the exemption threshold is too low. As a result, decreased competition has left consumers with fewer choices and higher priced remittances."

Yashewski goes on to say that the cost of compliance with the remittance rule is simply too high for a credit union that offers it as a side-service to members. "We have found that many credit unions were completing more than the exemption threshold of 100 transfers but not nearly enough transactions to justify the compliance burdens and costs."

"[W]e urge CFPB to exercise its authority to modify the remittance rule exemption threshold," Yashewski added. "We suggest raising the threshold from 100 to at least 1,000 transactions. This modification would alleviate harm suffered by consumers and credit union members under the current rule, while still imposing consumer protection standards on entities truly considered 'remittance transfer providers' under the Dodd-Frank Act."

View the letter in its entirety.

If you have questions or need help to craft or file your own comments, visit our compliance site. To access this site, you'll need your Cornerstone CUpassport ID and password.

If you have questions about this issue, please contact Suzanne Yashewski at 512-853-8516 or syashewski@cornerstoneleague.coop.