WASHINGTON The Consumer Financial Protection Bureau has finalized a rule subjecting large nonbank international money transmitters to supervision by the bureau.
The rule is intended to include nonbank providers among the companies that must comply with the CFPB's new regulation on remittances, which became effective in October.
"Last year, our new protections for consumers sending money abroad took effect," said CFPB Director Richard Cordray in a press release. "Today's rule gives us oversight of the larger marketplace and allows us to ensure that consumers are actually receiving those protections."
The rule was authorized under Dodd-Frank Act powers allowing the CFPB to identify certain nonbank sectors from which the bureau will examine "larger participants." In concert with the remittance rule, the new plan will ensure that larger nonbank transmitters have better disclosures, give consumers their money back if they cancel a transfer within 30 minutes of paying and correct errors within a certain timeframe.
The CFPB proposed the larger participant rule for money transmitters in January. It applies to nonbank remittance providers that individually process more than a million international money transfers per year. The CFPB estimates the plan will cover about 25 of the largest nonbank providers. The rule will take effect on Dec. 1.