Money Transmitter

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On June 13, Judge Katherine Polk Failla of the U.S. District Court for the Southern District of New York entered a stipulated final judgement resolving claims brought by the New York Attorney General against a global money transmitter. The lawsuit, initially filed in partnership with the CFPB (previously discussed here), alleged violations of the Electronic Fund Transfer Act (EFTA), including the Remittance Rule under Regulation E, as well as the Consumer Financial Protection Act (CFPA).Continue Reading New York AG Secures $250,000 Settlement With Money Transmitter Over Remittance Rule Violations

On April 16, the Colorado General Assembly enacted House Bill 25-1201, replacing the state’s prior money transmitter law with the Money Transmission Modernization Act (the “Act”). Modeled on the multistate framework developed by the Conference of State Bank Supervisors (CSBS), the Act aims to align Colorado’s licensing and oversight regime with standards adopted in other states, while updating key regulatory definitions, exemptions, prudential requirements, and enforcement tools. Continue Reading Colorado Overhauls Money Transmission Law to Align with Multistate Licensing Standards 

On September 20, the CFPB announced a proposed rule which would make a minor yet noteworthy amendment to the guidelines for the disclosures that remittance providers are required to provide to consumers in connection with certain international money transfers, or remittances.Continue Reading CFPB Revises Disclosure Requirements for Remittance Providers

On March 27, the CFPB issued Circular 2024-02, which warns that remittance providers may be liable under the CFPA for certain deceptive marketing practices related to the speed or cost of sending a remittance transfer. Under EFTA’s “Remittance Rule,” (Subpart B of Regulation E), the term “remittance transfer” includes most electronic transfers of funds sent by consumers in the United States to recipients in other countries. Alarmingly, the Bureau notes that providers may be liable irrespective of whether they are in compliance with the Remittance Rule’s disclosure requirements. The Bureau’s circular singles out the following advertising practices by remittance providers as potentially deceptive in violation of the CFPA:Continue Reading CFPB Issues Guidance on Deceptive Practices by Remittance Transfer Providers

On July 29, a payment processor company and its two sales affiliates (defendants) agreed to a stipulated order with the FTC to settle charges that they imposed hidden terms, surprise exit fees, and “zombie charges” on small businesses.
Continue Reading Payment Processor Agrees to Refund Customers After FTC Alleges Surprise Exit Fees and Zombie Charges On Small Businesses

On March 23, the California Department of Financial Protection and Innovation (DFPI) responded to a request for an interpretative legal opinion as to whether the virtual currency services offered by a company require it to obtain a license under the California Money Transmission Act (MTA).
Continue Reading DFPI: Virtual Currency Platform is not Money Transmitter

Recently Florida and Arkansas made it a requirement for those engaging in virtual currency activities to obtain money transmission licenses in their respective jurisdictions.
Continue Reading Money Transmission Licenses Required for Virtual Currency Activities in Arkansas and Florida