Regulation E and the Language Used for Foreign Remittance Disclosures

Issue/Inquiry

The Bank processes consumer foreign wires and provides the appropriate Regulation E disclosures.  Most of the wires are sent from two office locations to South Korea. The Bank does not provide the disclosures in Korean because it does not market, advertise or solicit these services in Korean.  Is Bank correct in that it is not required to provide the disclosures in the Korean language?

Response Summary

Regulation E offers two options with regards the language or languages in which the disclosures must be made. The first is to make the disclosures in English and the language in which the remittance transfer provider advertises or markets the service at the office where the remittance transfers are sent or where an error is asserted. The second is to make the disclosures in English and the language predominately used to conduct the transaction, if the Bank also advertises in that language. In this case, the Bank can make the disclosures in English only, since it does not market the services in any other language.

Response Detail

Under the foreign remittance transfer rules of Regulation E, when disclosures are provided in a retainable form, remittance transfer providers have two compliance options for the languages used for the disclosures:

The first option is to provide the disclosure in English and each of the foreign languages used by the provider to advertise, solicit, or market remittance transfers at the office at which a sender conducts a transaction or asserts an error. For example, if the provider’s office contains advertisements for remittance transfers in English, Spanish, and Vietnamese, providers could make disclosures in all three languages. 12 C.F.R. §1005.31(g)(1)(i).

The second language disclosure option is to provide the disclosures in English and, if applicable, the foreign language primarily used by the sender to conduct business with the provider, if the Bank also advertises in that language. For example, if the sender requests the transfer in Spanish and the Bank markets the service in Spanish, providers must provide the disclosures in English and Spanish. But if the sender requests the transfer in English, only disclosures in English are required. 12 C.F.R. §1005.31(g)(1)(ii).

The commentary for section 31(g) of Regulation E provides additional guidance on the language requirements, including the language primarily used by the sender to conduct the transaction or assert an error. For example, if the sender requests remittance transfer information from a provider in English about sending a remittance transfer to a person in Mexico, and the provider and the sender begin communicating in Spanish, Spanish is the language primarily used to conduct the transaction. To facilitate compliance, some of the model forms show disclosures printed in Spanish. Official Interpretations, ¶1005.31(g) – 2(i).

Similarly, if a sender begins discussing a problem with a previous remittance transfer to Vietnam in English, but the discussion continues in Vietnamese, the Vietnamese language is the language primarily used to conduct the transaction. Official Interpretations, ¶1005.31(g) – 2(iii).

In this case, the first option is not applicable, since the Bank does not advertise, solicit, or market remittance transfers at the offices at which the remittance transfers are sent. As to the second, even if the Bank conducted the transaction in Korean, it would not be required to make the disclosures in English and Korean, since it does not advertise the service in Korean.

This entry was posted on Tuesday, July 5th, 2016 at 3:00 pm.