Remittance Transfers, 44761-44763 [2011-18930]
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44761
Rules and Regulations
Federal Register
Vol. 76, No. 144
Wednesday, July 27, 2011
This section of the FEDERAL REGISTER
contains regulatory documents having general
applicability and legal effect, most of which
are keyed to and codified in the Code of
Federal Regulations, which is published under
50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by
the Superintendent of Documents. Prices of
new books are listed in the first FEDERAL
REGISTER issue of each week.
NATIONAL CREDIT UNION
ADMINISTRATION
12 CFR Part 701
RIN 3133–AD94
Remittance Transfers
National Credit Union
Administration (NCUA).
ACTION: Interim final rule with request
for comments.
AGENCY:
NCUA is amending its rules
to conform to amendments made to the
Federal Credit Union Act (FCU Act) by
the Dodd-Frank Wall Street Reform and
Consumer Protection Act (Dodd-Frank
Act). The interim final rule adds
remittance transfers, as now defined
under the Electronic Fund Transfer Act
(EFTA), as an example of money
transfer instruments Federal credit
unions (FCUs) may provide to persons
within their fields of membership.
DATES: This interim final rule is
effective July 27, 2011. Comments must
be received by NCUA on or before
September 26, 2011.
ADDRESSES: You may submit comments
by any of the following methods (Please
send comments by one method only):
• Federal eRulemaking Portal: https://
www.regulations.gov. Follow the
instructions for submitting comments.
• NCUA Web Site: https://
www.ncua.gov/
RegulationsOpinionsLaws/
proposed_regs/proposed_regs.html.
Follow the instructions for submitting
comments.
• E-mail: Address to
regcomments@ncua.gov. Include ‘‘[Your
name] Comments on Interim Final Rule,
Part 701, Remittance Transfers’’ in the
e-mail subject line.
• Fax: (703) 518–6319. Use the
subject line described above for e-mail.
• Mail: Address to Mary Rupp,
Secretary of the Board, National Credit
Union Administration, 1775 Duke
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SUMMARY:
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Jkt 223001
Street, Alexandria, Virginia 22314–
3428.
• Hand Delivery/Courier: Same as
mail address.
FOR FURTHER INFORMATION CONTACT:
Chrisanthy Loizos, Staff Attorney, Office
of General Counsel, at the above address
or telephone: (703) 518–6540.
SUPPLEMENTARY INFORMATION:
I. Background
In 2006, the Financial Services
Regulatory Relief Act of 2006 (Reg Relief
Act), Public Law 109–351, relieved a
longstanding limitation on FCUs
regarding financial services.
Specifically, Section 503 of the Relief
Act amended the FCU Act to permit
FCUs to provide certain financial
services to all persons within their
fields of membership. Congress
intended to allow FCUs ‘‘to sell
negotiable checks, money orders, and
other similar transfer instruments,
including international and domestic
electronic fund transfers, to anyone
eligible for membership, regardless of
their membership status.’’ S. Rpt. 109–
256, p. 5; H. Rpt. 109–356 Part 1, p. 63.
To implement this authority, NCUA
created a new regulatory section to
address the provision of financial
services to persons within an FCU’s
field of membership and issued § 701.30
to implement Section 503. 71 FR 62875
(Oct. 27, 2006) (interim final rule); 72
FR 7927 (Feb. 22, 2007) (final rule).
Section 1073 of the Dodd-Frank Act
added a new Section 919 to the EFTA,
entitled ‘‘Remittance Transfers.’’ Public
Law 111–203, § 1073, 124 Stat. 2066
(2010). The new Section 919 of the
EFTA creates protections for consumers
who, through remittance transfer
providers, send money to designated
recipients located in foreign countries.
15 U.S.C. 1693o–1. Paragraph (d) of
Section 1073 of Dodd-Frank amended
the FCU Act to specify that a remittance
transfer, as defined by new Section 919
of the EFTA, is an example of a money
transfer instrument that FCUs may sell
to persons within their fields of
membership. 12 U.S.C. 1757(12)(A).
Section 919(g)(2) of the EFTA, defines
a remittance transfer as an electronic
transfer of funds requested by a sender
to a designated recipient that is initiated
by a remittance transfer provider,
regardless of whether the sender has an
account with the remittance transfer
provider or whether the transfer meets
PO 00000
Frm 00001
Fmt 4700
Sfmt 4700
the statute’s definition of an EFT. 15
U.S.C. 1693o–1(g)(2). The law excludes
small value transactions from the
definition. Remittance transfers,
typically consumer to consumer
payments, may be executed through a
variety of means, including
international wire transfers,
international automated clearing house
transactions, other account-to-account
or account-to-cash products, and
reloadable prepaid cards. The law
requires remittance transfer providers to
give consumers certain disclosures,
including a receipt that contains
remittance transfer fees, the exchange
rate to be used by the remittance
transfer provider, the amount of
currency to be received by the recipient
and the estimated date of delivery. In
addition, the law requires the sender to
receive a statement that addresses error
resolution rights. The Federal Reserve
Board’s recently proposed remittance
transfer rule, which addresses
disclosure requirements and error
resolution, provides a detailed analysis
of the services offered by remittance
transfer providers. 99 FR 29902 (May
23, 2011).
FCUs have had the authority to
transfer funds at the request of
consumers within their fields of
membership to recipients
internationally since the adoption of the
Reg Relief Act. The amendment to the
FCU Act’s powers provision by the
Dodd-Frank Act makes plain that FCUs
may offer all variations of remittance
transfers, as now defined by the EFTA,
for the benefit of consumers within their
fields of membership, subject to certain
consumer protections. The addition of
remittance transfers as an example of
permissible money transfer instruments,
in addition to the newly-enacted
consumer disclosures and rights,
demonstrate the clear intention of
Congress to promote access to
remittance transfers and ensure
protections for consumers.
Finally, Section 1073(d) of the DoddFrank Act adjusted Section 107(12) of
the FCU Act by removing the reference
to the receipt of international and
domestic EFTs from subparagraph (B).
As explained below, this simply
eliminates a redundancy and does not
affect the ability of FCUs to offer EFT
services.
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27JYR1
44762
Federal Register / Vol. 76, No. 144 / Wednesday, July 27, 2011 / Rules and Regulations
mstockstill on DSK4VPTVN1PROD with RULES
II. Summary of the Rule
Similarly to the rulemakings that
implemented Section 503 of the Reg
Relief Act, the NCUA Board (Board) is
adopting amendments to § 701.30 that
directly track the statutory provisions of
Section 1073 of the Dodd-Frank Act.
The Board amends paragraph (a) of
§ 701.30 to include remittance transfers
as defined by Section 919 of the EFTA
as an example of permissible money
transfer instruments. The Board also
makes a corresponding amendment to
paragraph (b) to remove the language
referring to an FCU’s receipt of
international and domestic EFTs.
The Board notes the amendment to
§ 701.30(b) will have no effect on FCUs.
The Board views the deletion of the
phrase ‘‘and receive international and
domestic electronic fund transfers’’ from
the Section 107(12)(B) of the FCU Act as
a housekeeping amendment.
When adopting the phrase in Section
107(12)(B) through the Reg Relief Act,
Congress simply clarified the authority
it granted to FCUs in Section
107(12)(A). 12 U.S.C. 1757(12). Section
903 of the EFTA defines ‘‘electronic
fund transfer’’ as ‘‘any transfer of funds
* * * initiated through an electronic
terminal, telephonic instrument, or
computer or magnetic tape so as to
order, instruct, or authorize a financial
institution to debit or credit an
account.’’ 15 U.S.C. 1693a(6); see also
12 CFR 205.3(b). By expressly
authorizing FCUs ‘‘to sell’’ international
and domestic EFTs in Section
107(12)(A) of the FCU Act, Congress
permitted FCUs to send or receive funds
upon instruction because, by definition,
EFTs are authorizations to debit or
credit an account. To read the power ‘‘to
sell’’ EFT services separately from the
ability to ‘‘receive’’ EFTs would be
wholly inconsistent with Congressional
intent to provide EFT services to
persons in the field of membership,
particularly for those who may not have
ready and affordable access to these
services. It would also be unfeasible for
an FCU to offer consumers the ability to
initiate transfers from their accounts but
not receive EFTs. As discussed above,
Congress clearly intended to promote
the availability of services to consumers
under Section 1073 of the Dodd-Frank
Act by explicitly referencing remittance
transfers services. The amendment to
FCU Act Section 107(12)(B) was not
meant to restrict or otherwise limit an
FCU’s ability to effectively provide
services to consumers.
III. Interim Final Rule
As with the initial rulemaking
adopting § 701.30, the Board is issuing
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16:06 Jul 26, 2011
Jkt 223001
this rulemaking as an interim final rule
because there is a strong public interest
in having advantageous and consumeroriented rules that enhance credit union
services for members and consumers.
The amendments of Section 1073 of the
Dodd-Frank Act are self-implementing.
The rule strictly conforms to the
statutory language and expressly
recognizes FCU authority to provide
remittance transfers to persons within
their fields of membership, subject to
new consumer protections. The Board
finds these reasons are good cause to
dispense with the 30-day delayed
effective date requirement under section
553(d)(3) of the Administrative
Procedure Act. Accordingly, the Board
finds that, pursuant to 5 U.S.C.
553(b)(3), notice and public procedures
are unnecessary and contrary to the
public interest; and, pursuant to 5
U.S.C. 553(d)(3), the rule will be
effective upon publication in the
Federal Register. Although the rule is
being issued as an interim final rule and
is effective upon publication, the Board
encourages interested parties to submit
comments.
IV. Regulatory Procedures
Regulatory Flexibility Act
The Regulatory Flexibility Act
requires NCUA to prepare an analysis to
describe any significant economic
impact a rule may have on a substantial
number of small credit unions, defined
as those under ten million dollars in
assets. This rule only clarifies and
improves the available services FCUs
may provide to their members and
persons within their fields of
membership, without imposing any
regulatory burden. The interim final
amendments would not have a
significant economic impact on a
substantial number of small credit
unions, and, therefore, a regulatory
flexibility analysis is not required.
Paperwork Reduction Act
NCUA has determined that the
interim final rule would not increase
paperwork requirements under the
Paperwork Reduction Act of 1995 and
regulations of the Office of Management
and Budget. 44 U.S.C. 3501 et seq.; 5
CFR part 1320.
order. The interim final rule would not
have substantial direct effects on the
states, on the connection between the
national government and the States, or
on the distribution of power and
responsibilities among the various
levels of government. NCUA has
determined that this rule does not
constitute a policy that has federalism
implications for purposes of the
executive order.
The Treasury and General Government
Appropriations Act, 1999—Assessment
of Federal Regulations and Policies on
Families
The NCUA has determined that this
interim final rule would not affect
family well-being within the meaning of
section 654 of the Treasury and General
Government Appropriations Act, 1999,
Public Law 105–277, 112 Stat. 2681
(1998).
Small Business Regulatory Enforcement
Fairness Act
The Small Business Regulatory
Enforcement Fairness Act of 1996,
Public Law 104–121 (SBREFA),
provides generally for congressional
review of agency rules. A reporting
requirement is triggered in instances
where NCUA issues a final rule as
defined by Section 551 of the APA. 5
U.S.C. 551. NCUA has requested a
SBREFA determination from the Office
of Management and Budget, which is
pending. As required by SBREFA,
NCUA will file the appropriate reports
with Congress and the General
Accounting Office so that the interim
rule may be reviewed.
Agency Regulatory Goal
NCUA’s goal is to promulgate clear
and understandable regulations that
impose minimal regulatory burden. We
request your comments on whether the
proposed amendments are
understandable and minimally intrusive
if implemented as proposed.
List of Subjects in 12 CFR Part 701
Credit unions.
By the National Credit Union
Administration Board on July 21, 2011.
Mary Rupp,
Secretary of the Board.
Executive Order 13132
Executive Order 13132 encourages
independent regulatory agencies to
consider the impact of their actions on
state and local interests. In adherence to
fundamental federalism principles,
NCUA, an independent regulatory
agency as defined in 44 U.S.C. 3502(5),
voluntarily complies with the executive
For the reasons stated in the
preamble, the National Credit Union
Administration amends 12 CFR part 701
as set forth below:
PART 701—ORGANIZATION AND
OPERATION OF FEDERAL CREDIT
UNIONS
PO 00000
Frm 00002
Fmt 4700
Sfmt 4700
1. The authority citation for part 701
continues to read as follows:
■
E:\FR\FM\27JYR1.SGM
27JYR1
Federal Register / Vol. 76, No. 144 / Wednesday, July 27, 2011 / Rules and Regulations
Authority: 12 U.S.C. 1752(5), 1755, 1756,
1757, 1758, 1759, 1761a, 1761b, 1766,
1767,1782, 1784, 1786, 1787, and 1789.
Section 701.6 is also authorized by 15 U.S.C.
3717. Section 701.31 is also authorized by 15
U.S.C. 1601 et seq.; 42 U.S.C. 1981 and 3601–
3619. Section 701.35 is also authorized by 42
U.S.C. 4311–4312.
§ 701.30
[Amended]
2. Amend § 701.30 as follows:
a. Add to paragraph (a) the phrase
‘‘and remittance transfers, as defined in
section 919 of the Electronic Fund
Transfer Act’’ after the words
‘‘electronic fund transfers.’’
■ b. Remove the phrase ‘‘and receiving
international and domestic electronic
fund transfers’’ after the words ‘‘money
orders’’ from paragraph (b).
■
■
[FR Doc. 2011–18930 Filed 7–26–11; 8:45 am]
BILLING CODE 7535–01–P
FINANCIAL STABILITY OVERSIGHT
COUNCIL
12 CFR Chapter XIII and Part 1320
RIN 4030–AA01
Authority To Designate Financial
Market Utilities as Systemically
Important
Financial Stability Oversight
Council.
ACTION: Final rule.
AGENCY:
Section 804 of the DoddFrank Wall Street Reform and Consumer
Protection Act (the ‘‘DFA’’) provides the
Financial Stability Oversight Council
(the ‘‘Council’’) the authority to
designate a financial market utility
(‘‘FMU’’) that the Council determines is
or is likely to become systemically
important because the failure of or a
disruption to the functioning of the
FMU could create, or increase, the risk
of significant liquidity or credit
problems spreading among financial
institutions or markets and thereby
threaten the stability of the United
States financial system. This final rule
describes the criteria that will inform
and the processes and procedures
established under the DFA for the
Council’s designation of FMUs as
systemically important under the DFA.
The Council published an advance
notice of proposed rulemaking regarding
the designation criteria in section 804
on December 21, 2010, followed by a
notice of proposed rulemaking
(‘‘NPRM’’) on March 28, 2011. The
Council notes that this final rule only
addresses the designation of FMUs. The
Council expects to address the
designation of payment, clearing, or
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SUMMARY:
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16:06 Jul 26, 2011
Jkt 223001
settlement activities as systemically
important in a separate rulemaking.
DATES: Effective date: August 26, 2011.
FOR FURTHER INFORMATION CONTACT:
Lance Auer, Deputy Assistant Secretary
(Financial Institutions), Treasury, at
(202) 622–1262, Patrick Pinschmidt,
Senior Policy Advisor, Treasury, at
(202) 622–2495, Jordan Bleicher,
Financial Analyst, Treasury, at (202)
622–6491 or Steven D. Laughton, Senior
Counsel, Office of the General Counsel,
Treasury, at (202) 622–8413.
SUPPLEMENTARY INFORMATION:
I. Background
Dodd-Frank Wall Street Reform and
Consumer Protection Act
Title VIII of the DFA is entitled the
‘‘Payment, Clearing, and Settlement
Supervision Act of 2010.’’ 1 FMUs form
a critical part of the nation’s financial
infrastructure. They exist in many
markets to support and facilitate the
transfer, clearing or settlement of
financial transactions, and their smooth
operation is integral to the soundness of
the financial system and the overall
economy. However, their function and
interconnectedness also concentrate a
considerable amount of risk in the
financial system due, in large part, to
the interdependencies, either directly
through operational, contractual or
affiliation linkages, or indirectly
through payment, clearing, and
settlement processes. In other words,
problems at one FMU could trigger
significant liquidity and credit
disruptions at other FMUs or financial
institutions.
Section 804(a)(1) of the DFA states
that the Council, ‘‘on a nondelegable
basis and by a vote of not fewer than 2⁄3
of the members then serving, including
an affirmative vote by the Chairperson
of the Council, shall designate those
financial market utilities or payment,
clearing, or settlement activities that the
Council determines are, or are likely to
become, systemically important.’’
Subject to certain exclusions, the DFA
defines an FMU as ‘‘any person that
manages or operates a multilateral
system for the purposes of transferring,
clearing, or settling payments,
securities, or other financial
transactions among financial
institutions or between financial
institutions and the person.’’ 2
Section 111 of the DFA establishes the
Council. Among the duties of the
U.S.C. 5461 et seq.
12 U.S.C. 5462(6). Section 5462(6)(B)
specifically excludes a number of entities, such as
designated contract markets and national securities
exchanges meeting certain criteria, from the
definition of an FMU.
PO 00000
1 12
2 See
Frm 00003
Fmt 4700
Sfmt 4700
44763
Council under section 112(a)(2) is to
‘‘identify systemically important
FMUs,’’ as defined in the statute.3
Section 804 of the DFA requires the
Council, after consultation with the
Board of Governors of the Federal
Reserve System (the ‘‘Board of
Governors’’) and the relevant federal
agency that has primary jurisdiction
over an FMU under federal banking,
securities, or commodity futures laws
(‘‘Supervisory Agency’’), to identify and
designate an FMU that is, or is likely to
become, systemically important if the
Council determines that a failure of or
disruption to an FMU could create, or
increase, the risk of significant liquidity
or credit problems spreading across
financial institutions and markets and
thereby threaten the stability of the U.S.
financial system.4
The designation of an FMU as
systemically important by the Council
subjects the designated FMU to the
requirements of Title VIII of the DFA
(‘‘Title VIII’’). For example, section
805(a) authorizes the Board of
Governors, the Commodity Futures
Trading Commission (‘‘CFTC’’), and the
Securities and Exchange Commission
(‘‘SEC’’), in consultation with the
Council and one or more Supervisory
Agencies and taking into consideration
relevant international standards and
existing prudential requirements, to
prescribe risk management standards
governing the operations related to the
payment, clearing, and settlement
activities of systemically important
FMUs.5 The objectives and principles
for the risk management standards are to
promote robust risk management and
safety and soundness, reduce systemic
risk, and support the stability of the
broader financial system.6 These
standards may address areas, as
outlined in section 805(c), such as risk
management policies and procedures,
margin and collateral requirements,
participant or counterparty default
policies and procedures, the ability to
complete timely clearing and settlement
of financial transactions, capital and
financial resource requirements for
designated FMUs, as well as other areas
that are necessary to achieve these
3 See
12 U.S.C. 5322(a)(2)(J).
804(a)(1) of the DFA states that the
Council, ‘‘on a nondelegable basis and by a vote of
not fewer than 2⁄3 of the members then serving,
including an affirmative vote by the Chairperson of
the Council, shall designate those financial market
utilities or payment, clearing, or settlement
activities that the Council determines are, or are
likely to become, systemically important.’’ 12
U.S.C. 5463(a)(1). See also DFA section 803(9)
(defining systemic importance). 12 U.S.C. 5462(9).
5 See 12 U.S.C. 5464(a).
6 See 12 U.S.C. 5464(b).
4 Section
E:\FR\FM\27JYR1.SGM
27JYR1
Agencies
[Federal Register Volume 76, Number 144 (Wednesday, July 27, 2011)]
[Rules and Regulations]
[Pages 44761-44763]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-18930]
========================================================================
Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
Prices of new books are listed in the first FEDERAL REGISTER issue of each
week.
========================================================================
Federal Register / Vol. 76, No. 144 / Wednesday, July 27, 2011 /
Rules and Regulations
[[Page 44761]]
NATIONAL CREDIT UNION ADMINISTRATION
12 CFR Part 701
RIN 3133-AD94
Remittance Transfers
AGENCY: National Credit Union Administration (NCUA).
ACTION: Interim final rule with request for comments.
-----------------------------------------------------------------------
SUMMARY: NCUA is amending its rules to conform to amendments made to
the Federal Credit Union Act (FCU Act) by the Dodd-Frank Wall Street
Reform and Consumer Protection Act (Dodd-Frank Act). The interim final
rule adds remittance transfers, as now defined under the Electronic
Fund Transfer Act (EFTA), as an example of money transfer instruments
Federal credit unions (FCUs) may provide to persons within their fields
of membership.
DATES: This interim final rule is effective July 27, 2011. Comments
must be received by NCUA on or before September 26, 2011.
ADDRESSES: You may submit comments by any of the following methods
(Please send comments by one method only):
Federal eRulemaking Portal: https://www.regulations.gov.
Follow the instructions for submitting comments.
NCUA Web Site: https://www.ncua.gov/RegulationsOpinionsLaws/proposed_regs/proposed_regs.html. Follow the
instructions for submitting comments.
E-mail: Address to regcomments@ncua.gov. Include ``[Your
name] Comments on Interim Final Rule, Part 701, Remittance Transfers''
in the e-mail subject line.
Fax: (703) 518-6319. Use the subject line described above
for e-mail.
Mail: Address to Mary Rupp, Secretary of the Board,
National Credit Union Administration, 1775 Duke Street, Alexandria,
Virginia 22314-3428.
Hand Delivery/Courier: Same as mail address.
FOR FURTHER INFORMATION CONTACT: Chrisanthy Loizos, Staff Attorney,
Office of General Counsel, at the above address or telephone: (703)
518-6540.
SUPPLEMENTARY INFORMATION:
I. Background
In 2006, the Financial Services Regulatory Relief Act of 2006 (Reg
Relief Act), Public Law 109-351, relieved a longstanding limitation on
FCUs regarding financial services. Specifically, Section 503 of the
Relief Act amended the FCU Act to permit FCUs to provide certain
financial services to all persons within their fields of membership.
Congress intended to allow FCUs ``to sell negotiable checks, money
orders, and other similar transfer instruments, including international
and domestic electronic fund transfers, to anyone eligible for
membership, regardless of their membership status.'' S. Rpt. 109-256,
p. 5; H. Rpt. 109-356 Part 1, p. 63. To implement this authority, NCUA
created a new regulatory section to address the provision of financial
services to persons within an FCU's field of membership and issued
Sec. 701.30 to implement Section 503. 71 FR 62875 (Oct. 27, 2006)
(interim final rule); 72 FR 7927 (Feb. 22, 2007) (final rule).
Section 1073 of the Dodd-Frank Act added a new Section 919 to the
EFTA, entitled ``Remittance Transfers.'' Public Law 111-203, Sec.
1073, 124 Stat. 2066 (2010). The new Section 919 of the EFTA creates
protections for consumers who, through remittance transfer providers,
send money to designated recipients located in foreign countries. 15
U.S.C. 1693o-1. Paragraph (d) of Section 1073 of Dodd-Frank amended the
FCU Act to specify that a remittance transfer, as defined by new
Section 919 of the EFTA, is an example of a money transfer instrument
that FCUs may sell to persons within their fields of membership. 12
U.S.C. 1757(12)(A).
Section 919(g)(2) of the EFTA, defines a remittance transfer as an
electronic transfer of funds requested by a sender to a designated
recipient that is initiated by a remittance transfer provider,
regardless of whether the sender has an account with the remittance
transfer provider or whether the transfer meets the statute's
definition of an EFT. 15 U.S.C. 1693o-1(g)(2). The law excludes small
value transactions from the definition. Remittance transfers, typically
consumer to consumer payments, may be executed through a variety of
means, including international wire transfers, international automated
clearing house transactions, other account-to-account or account-to-
cash products, and reloadable prepaid cards. The law requires
remittance transfer providers to give consumers certain disclosures,
including a receipt that contains remittance transfer fees, the
exchange rate to be used by the remittance transfer provider, the
amount of currency to be received by the recipient and the estimated
date of delivery. In addition, the law requires the sender to receive a
statement that addresses error resolution rights. The Federal Reserve
Board's recently proposed remittance transfer rule, which addresses
disclosure requirements and error resolution, provides a detailed
analysis of the services offered by remittance transfer providers. 99
FR 29902 (May 23, 2011).
FCUs have had the authority to transfer funds at the request of
consumers within their fields of membership to recipients
internationally since the adoption of the Reg Relief Act. The amendment
to the FCU Act's powers provision by the Dodd-Frank Act makes plain
that FCUs may offer all variations of remittance transfers, as now
defined by the EFTA, for the benefit of consumers within their fields
of membership, subject to certain consumer protections. The addition of
remittance transfers as an example of permissible money transfer
instruments, in addition to the newly-enacted consumer disclosures and
rights, demonstrate the clear intention of Congress to promote access
to remittance transfers and ensure protections for consumers.
Finally, Section 1073(d) of the Dodd-Frank Act adjusted Section
107(12) of the FCU Act by removing the reference to the receipt of
international and domestic EFTs from subparagraph (B). As explained
below, this simply eliminates a redundancy and does not affect the
ability of FCUs to offer EFT services.
[[Page 44762]]
II. Summary of the Rule
Similarly to the rulemakings that implemented Section 503 of the
Reg Relief Act, the NCUA Board (Board) is adopting amendments to Sec.
701.30 that directly track the statutory provisions of Section 1073 of
the Dodd-Frank Act. The Board amends paragraph (a) of Sec. 701.30 to
include remittance transfers as defined by Section 919 of the EFTA as
an example of permissible money transfer instruments. The Board also
makes a corresponding amendment to paragraph (b) to remove the language
referring to an FCU's receipt of international and domestic EFTs.
The Board notes the amendment to Sec. 701.30(b) will have no
effect on FCUs. The Board views the deletion of the phrase ``and
receive international and domestic electronic fund transfers'' from the
Section 107(12)(B) of the FCU Act as a housekeeping amendment.
When adopting the phrase in Section 107(12)(B) through the Reg
Relief Act, Congress simply clarified the authority it granted to FCUs
in Section 107(12)(A). 12 U.S.C. 1757(12). Section 903 of the EFTA
defines ``electronic fund transfer'' as ``any transfer of funds * * *
initiated through an electronic terminal, telephonic instrument, or
computer or magnetic tape so as to order, instruct, or authorize a
financial institution to debit or credit an account.'' 15 U.S.C.
1693a(6); see also 12 CFR 205.3(b). By expressly authorizing FCUs ``to
sell'' international and domestic EFTs in Section 107(12)(A) of the FCU
Act, Congress permitted FCUs to send or receive funds upon instruction
because, by definition, EFTs are authorizations to debit or credit an
account. To read the power ``to sell'' EFT services separately from the
ability to ``receive'' EFTs would be wholly inconsistent with
Congressional intent to provide EFT services to persons in the field of
membership, particularly for those who may not have ready and
affordable access to these services. It would also be unfeasible for an
FCU to offer consumers the ability to initiate transfers from their
accounts but not receive EFTs. As discussed above, Congress clearly
intended to promote the availability of services to consumers under
Section 1073 of the Dodd-Frank Act by explicitly referencing remittance
transfers services. The amendment to FCU Act Section 107(12)(B) was not
meant to restrict or otherwise limit an FCU's ability to effectively
provide services to consumers.
III. Interim Final Rule
As with the initial rulemaking adopting Sec. 701.30, the Board is
issuing this rulemaking as an interim final rule because there is a
strong public interest in having advantageous and consumer-oriented
rules that enhance credit union services for members and consumers. The
amendments of Section 1073 of the Dodd-Frank Act are self-implementing.
The rule strictly conforms to the statutory language and expressly
recognizes FCU authority to provide remittance transfers to persons
within their fields of membership, subject to new consumer protections.
The Board finds these reasons are good cause to dispense with the 30-
day delayed effective date requirement under section 553(d)(3) of the
Administrative Procedure Act. Accordingly, the Board finds that,
pursuant to 5 U.S.C. 553(b)(3), notice and public procedures are
unnecessary and contrary to the public interest; and, pursuant to 5
U.S.C. 553(d)(3), the rule will be effective upon publication in the
Federal Register. Although the rule is being issued as an interim final
rule and is effective upon publication, the Board encourages interested
parties to submit comments.
IV. Regulatory Procedures
Regulatory Flexibility Act
The Regulatory Flexibility Act requires NCUA to prepare an analysis
to describe any significant economic impact a rule may have on a
substantial number of small credit unions, defined as those under ten
million dollars in assets. This rule only clarifies and improves the
available services FCUs may provide to their members and persons within
their fields of membership, without imposing any regulatory burden. The
interim final amendments would not have a significant economic impact
on a substantial number of small credit unions, and, therefore, a
regulatory flexibility analysis is not required.
Paperwork Reduction Act
NCUA has determined that the interim final rule would not increase
paperwork requirements under the Paperwork Reduction Act of 1995 and
regulations of the Office of Management and Budget. 44 U.S.C. 3501 et
seq.; 5 CFR part 1320.
Executive Order 13132
Executive Order 13132 encourages independent regulatory agencies to
consider the impact of their actions on state and local interests. In
adherence to fundamental federalism principles, NCUA, an independent
regulatory agency as defined in 44 U.S.C. 3502(5), voluntarily complies
with the executive order. The interim final rule would not have
substantial direct effects on the states, on the connection between the
national government and the States, or on the distribution of power and
responsibilities among the various levels of government. NCUA has
determined that this rule does not constitute a policy that has
federalism implications for purposes of the executive order.
The Treasury and General Government Appropriations Act, 1999--
Assessment of Federal Regulations and Policies on Families
The NCUA has determined that this interim final rule would not
affect family well-being within the meaning of section 654 of the
Treasury and General Government Appropriations Act, 1999, Public Law
105-277, 112 Stat. 2681 (1998).
Small Business Regulatory Enforcement Fairness Act
The Small Business Regulatory Enforcement Fairness Act of 1996,
Public Law 104-121 (SBREFA), provides generally for congressional
review of agency rules. A reporting requirement is triggered in
instances where NCUA issues a final rule as defined by Section 551 of
the APA. 5 U.S.C. 551. NCUA has requested a SBREFA determination from
the Office of Management and Budget, which is pending. As required by
SBREFA, NCUA will file the appropriate reports with Congress and the
General Accounting Office so that the interim rule may be reviewed.
Agency Regulatory Goal
NCUA's goal is to promulgate clear and understandable regulations
that impose minimal regulatory burden. We request your comments on
whether the proposed amendments are understandable and minimally
intrusive if implemented as proposed.
List of Subjects in 12 CFR Part 701
Credit unions.
By the National Credit Union Administration Board on July 21,
2011.
Mary Rupp,
Secretary of the Board.
For the reasons stated in the preamble, the National Credit Union
Administration amends 12 CFR part 701 as set forth below:
PART 701--ORGANIZATION AND OPERATION OF FEDERAL CREDIT UNIONS
0
1. The authority citation for part 701 continues to read as follows:
[[Page 44763]]
Authority: 12 U.S.C. 1752(5), 1755, 1756, 1757, 1758, 1759,
1761a, 1761b, 1766, 1767,1782, 1784, 1786, 1787, and 1789. Section
701.6 is also authorized by 15 U.S.C. 3717. Section 701.31 is also
authorized by 15 U.S.C. 1601 et seq.; 42 U.S.C. 1981 and 3601-3619.
Section 701.35 is also authorized by 42 U.S.C. 4311-4312.
Sec. 701.30 [Amended]
0
2. Amend Sec. 701.30 as follows:
0
a. Add to paragraph (a) the phrase ``and remittance transfers, as
defined in section 919 of the Electronic Fund Transfer Act'' after the
words ``electronic fund transfers.''
0
b. Remove the phrase ``and receiving international and domestic
electronic fund transfers'' after the words ``money orders'' from
paragraph (b).
[FR Doc. 2011-18930 Filed 7-26-11; 8:45 am]
BILLING CODE 7535-01-P