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New rules for remittance centers proposed
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Posted on Nov 22 2008
As remittance numbers decrease and companies close, the Department of Commerce is proposing new regulations for remittance and foreign exchange companies.
The proposed regulation changes currently are listed in the Commonwealth Register.
“As remittances go down because not many people are remitting out, we’re going to see companies close, and when we see companies closing we don’t want to see them leaving with all of this liability out there,” said Commerce Secretary Michael Ada.
Under the proposed regulations, companies that transmit money would be required to make a $100,000 security deposit or bond. Currently, companies are required to make a $50,000 deposit or bond. Remittance companies also would be required to file electronic copies of their quarterly reports and provide more information in the reports, and comply with federal registration and reporting requirements.
Fees for foreign currency exchange companies and remittance companies would increase under the proposed regulations.
Currently, a company must pay $300 for a foreign exchange dealer license and $30 for an agent license. Under the proposed changes, foreign exchange companies would pay $300 for a dealer license and pay $50 for an agent license. Remittance companies would pay $300 for a license and $50 for a remittance agent license.
For companies desiring to withdraw their license, the new regulations would create strict guidelines, including submitting an application and placing a notice of intention to close in the newspaper with specific language.
Ada said he welcomes public comment on the possible changes.
Overseas remittances fell from $102.2 million in 2006 to $93.6 million in 2007. Meanwhile, four remittance companies closed their business in 2007, namely America Joint-Partner Corporation, Micronesia Money Exchange Co., Oceania Remittance Center, and Yun Mee Corporation.
