(a) Definition of error.
(1) Types of transfers or inquiries covered. For purposes of this section, the term error means:
(i) An incorrect amount paid by
a sender in connection with a remittance transfer unless the disclosure
stated an estimate of the amount paid by a sender in accordance with
section 1005.32(b)(2) and the difference results from application
of the actual exchange rate, fees, and taxes, rather than any estimated
amount;
(ii) A computational
or bookkeeping error made by the remittance transfer provider relating
to a remittance transfer;
(iii)
The failure to make available to a designated recipient the amount
of currency disclosed pursuant to section 1005.31(b)(1)(vii) and stated
in the disclosure provided to the sender under section 1005.31(b)(2)
or (3) for the remittance transfer, unless:
(A) The disclosure stated an estimate of the
amount to be received in accordance with section 1005.32(a) or (b)(1),
(2), (4), or (5) and the difference results from application of the
actual exchange rate, fees, and taxes, rather than any estimated amounts;
or
(B) The failure resulted from extraordinary
circumstances outside the remittance transfer provider’s control that
could not have been reasonably anticipated; or
(C) The difference results from the application
of non-covered third-party fees or taxes collected on the remittance
transfer by a person other than the provider and the provider provided
the disclosure required by section 1005.31(b)(1)(viii).
(iv) The failure to make funds available
to a designated recipient by the date of availability stated in the
disclosure provided to the sender under section 1005.31(b)(2) or (3)
for the remittance transfer, unless the failure to make the funds
available resulted from:
(A) Extraordinary circumstances outside the remittance transfer provider’s
control that could not have been reasonably anticipated;
(B) Delays related to a necessary investigation
or other special action by the remittance transfer provider or a third
party as required by the provider’s fraud screening procedures or
in accordance with the Bank Secrecy Act, 31 U.S.C. 5311 et seq., Office of Foreign Assets Control requirements, or similar laws
or requirements;
(C) The remittance
transfer being made with fraudulent intent by the sender or any person
acting in concert with the sender; or
(D) The sender having provided the remittance transfer provider an
incorrect account number or recipient institution identifier for the
designated recipient’s account or institution, provided that the remittance
transfer provider meets the conditions set forth in paragraph (h)
of this section;
(v) The sender’s request for documentation required by section 1005.31
or for additional information or clarification concerning a remittance
transfer, including a request a sender makes to determine whether
an error exists under paragraphs (a)(1)(i) through (iv) of this section.
(2) Types of transfers or inquiries not covered. The term error does not include:
(i) An inquiry about the status of a
remittance transfer, except where the funds from the transfer were
not made available to a designated recipient by the disclosed date
of availability as described in paragraph (a)(1)(iv) of this section;
(ii) A request for information
for tax or other recordkeeping purposes;
(iii) A change requested by the designated
recipient; or
(iv) A change in
the amount or type of currency received by the designated recipient
from the amount or type of currency stated in the disclosure provided
to the sender under section 1005.31(b)(2) or (3) if the remittance
transfer provider relied on information provided by the sender as
permitted under section 1005.31 in making such disclosure.
(b) Notice of error from sender.
(1) Timing; contents. A remittance transfer
provider shall comply with the requirements of this section with respect
to any oral or written notice of error from a sender that:
(i) Is received by the remittance
transfer provider no later than 180 days after the disclosed date
of availability of the remittance transfer;
(ii) Enables the provider to identify:
(A) The sender’s name and
telephone number or address;
(B) The
recipient’s name, and if known, the telephone number or address of
the recipient; and
(C) The remittance
transfer to which the notice of error applies; and
(iii) Indicates why the sender believes
an error exists and includes to the extent possible the type, date,
and amount of the error, except for requests for documentation, additional
information, or clarification described in paragraph (a)(1)(v) of
this section.
(2) Request for documentation or clarification. When a notice of error is based on documentation, additional information,
or clarification that the sender previously requested under paragraph
(a)(1)(v) of this section, the sender’s notice of error is timely
if received by the remittance transfer provider the later of 180 days
after the disclosed date of availability of the remittance transfer
or 60 days after the provider sent the documentation, information,
or clarification that had been requested.
(c) Time limits and extent of investigation.
(1) Time limits for investigation and report to
consumer of error. A remittance transfer provider shall investigate
promptly and determine whether an error occurred within 90 days of
receiving a notice of error. The remittance transfer provider shall
report the results to the sender, including notice of any remedies
available for correcting any error that the provider determines has
occurred, within three business days after completing its investigation.
(2) Remedies. Except as provided in paragraph (c)(2)(iii) of this section, if,
following an assertion of an error by a sender, the remittance transfer
provider determines an error occurred, the provider shall, within one
business day of, or as soon as reasonably practicable after, receiving
the sender’s instructions regarding the appropriate remedy, correct
the error as designated by the sender by:
(i) In the case of any error under paragraphs
(a)(1)(i) through (iii) of this section, as applicable, either:
(A) Refunding to the sender
the amount of funds provided by the sender in connection with a remittance
transfer which was not properly transmitted, or the amount appropriate
to resolve the error; or
(B) Making
available to the designated recipient, without additional cost to
the sender or to the designated recipient, the amount appropriate
to resolve the error;
(ii) Except as provided in paragraph
(c)(2)(iii) of this section, in the case of an error under paragraph
(a)(1)(iv) of this section
(A) As applicable, either:
(1)
Refunding to the sender the amount of funds provided by the sender
in connection with a remittance transfer which was not properly transmitted,
or the amount appropriate to resolve the error; or
(2) Making available to the designated
recipient the amount appropriate to resolve the error. Such amount
must be made available to the designated recipient without additional
cost to the sender or to the designated recipient; and
(B) Refunding to the sender any fees
imposed and, to the extent not prohibited by law, taxes collected
on the remittance transfer;
(iii) In the case of an error under
paragraph (a)(1)(iv) of this section that occurred because the sender
provided incorrect or insufficient information in connection with
the remittance transfer, the remittance transfer provider shall provide
the remedies required by paragraphs (c)(2)(ii)(A)(1) and (c)(2)(ii)(B)
of this section within three business days of providing the report
required by paragraph (c)(1) or (d)(1) of this section except that
the provider may agree to the sender’s request, upon receiving the
results of the error investigation, that the funds be applied towards
a new remittance transfer, rather than be refunded, if the provider
has not yet processed a refund. The provider may deduct from the amount
refunded or applied towards a new transfer any fees actually imposed
on or, to the extent not prohibited by law, taxes actually collected
on the remittance transfer as part of the first unsuccessful remittance
transfer attempt except that the provider shall not deduct its own
fee.
(iv) In the case of a request
under paragraph (a)(1)(v) of this section, providing the requested
documentation, information, or clarification.
(d) Procedures if remittance transfer
provider determines no error or different error occurred. In
addition to following the procedures specified in paragraph (c) of
this section, the remittance transfer provider shall follow the procedures
set forth in this paragraph (d) if it determines that no error occurred
or that an error occurred in a manner or amount different from that
described by the sender.
(1) Explanation of results of investigation. The remittance transfer provider’s report of the results of the
investigation shall include a written explanation of the provider’s
findings and shall note the sender’s right to request the documents
on which the provider relied in making its determination. The explanation
shall also address the specific complaint of the sender.
(2) Copies of
documentation. Upon the sender’s request, the remittance transfer
provider shall promptly provide copies of the documents on which the
provider relied in making its error determination.
(e) Reassertion of error. A remittance
transfer provider that has fully complied with the error resolution
requirements of this section has no further responsibilities under
this section should the sender later reassert the same error, except
in the case of an error asserted by the sender following receipt of
information provided under paragraph (a)(1)(v) of this section.
(f) Relation to other laws.
(1) Relation to Regulation E section 1005.11 for incorrect EFTs from
a sender’s account. If an alleged error involves an incorrect
electronic fund transfer from a sender’s account in connection with
a remittance transfer, and the sender provides a notice of error to
the account-holding institution, the account-holding institution shall
comply with the requirements of section 1005.11 governing error resolution
rather than the requirements of this section, provided that the account-holding
institution is not also the remittance transfer provider. If the remittance
transfer provider is also the financial institution that holds the
consumer’s account, then the error-resolution provisions of this section
apply when the sender provides such notice of error.
(2) Relation
to Truth in Lending Act and Regulation Z. If an alleged error
involves an incorrect extension of credit in connection with a remittance
transfer, an incorrect amount received by the designated recipient
under paragraph (a)(1)(iii) of this section that is an extension of
credit for property or services not delivered as agreed, or the failure
to make funds available by the disclosed date of availability under
paragraph (a)(1)(iv) of this section that is an extension of credit
for property or services not delivered as agreed, and the sender provides
a notice of error to the creditor extending the credit, the provisions
of Regulation Z, 12 CFR 1026.13, governing error resolution apply
to the creditor, rather than the requirements of this section, even
if the creditor is the remittance transfer provider. However, if the
creditor is the remittance transfer provider, paragraph (b) of this
section will apply instead of 12 CFR 1026.13(b). If the sender instead
provides a notice of error to the remittance transfer provider that
is not also the creditor, then the error-resolution provisions of
this section apply to the remittance transfer provider.
(3) Unauthorized
remittance transfers. If an alleged error involves an unauthorized
electronic fund transfer for payment in connection with a remittance
transfer, sections 1005.6 and 1005.11 apply with respect to the account-holding
institution. If an alleged error involves an unauthorized use of a
credit account for payment in connection with a remittance transfer,
the provisions of Regulation Z, 12 CFR 1026.12(b), if applicable,
and section 1026.13, apply with respect to the creditor.
(g) Error resolution standards and recordkeeping
requirements.
(1) Compliance program. A remittance transfer
provider shall develop and maintain written policies and procedures
that are designed to ensure compliance with the error resolution requirements
applicable to remittance transfers under this section.
(2) Retention
of error-related documentation. The remittance transfer provider’s
policies and procedures required under paragraph (g)(1) of this section
shall include policies and procedures regarding the retention of documentation
related to error investigations. Such policies and procedures must
ensure, at a minimum, the retention of any notices of error submitted
by a sender, documentation provided by the sender to the provider
with respect to the alleged error, and the findings of the remittance
transfer provider regarding the investigation of the alleged error.
Remittance transfer providers are subject to the record retention
requirements under section 1005.13.
(h) Incorrect account number or recipient institution
identifier provided by the sender. The exception in paragraph
(a)(1)(iv)(D) of this section applies if:
(1) The remittance transfer provider can
demonstrate that the sender provided an incorrect account number or
recipient institution identifier to the provider in connection with
the remittance transfer;
(2) For
any instance in which the sender provided the incorrect recipient
institution identifier, prior to or when sending the transfer, the
provider used reasonably available means to verify that the recipient
institution identifier provided by the sender corresponded to the
recipient institution name provided by the sender;
(3) The provider provided notice to the sender
before the sender made payment for the remittance transfer that, in
the event the sender provided an incorrect account number or recipient
institution identifier, the sender could lose the transfer amount.
For purposes of providing this disclosure, section 1005.31(a)(2) applies
to this notice unless the notice is given at the same time as other
disclosures required by this subpart for which information is permitted
to be disclosed orally or via mobile application or text message,
in which case this disclosure may be given in the same medium as those
other disclosures;
(4) The incorrect
account number or recipient institution identifier resulted in the
deposit of the remittance transfer into a customer’s account that
is not the designated recipient’s account; and
(5) The provider promptly used reasonable
efforts to recover the amount that was to be received by the designated
recipient.
