October 19, 2021

Volume XI, Number 292

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October 18, 2021

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CFPB Issues Update to Prepaid Rule Small Entity Compliance Guide

Last week, the CFPB released its most recent update to the Prepaid Rule Small Entity Compliance Guide.  The new version includes expanded information regarding the process for complying with the Prepaid Rule’s requirement to submit prepaid account agreements and certain other information to the CFPB.

Under the Prepaid Rule, prepaid issuers must make submissions to the CFPB on a rolling basis, including new prepaid accounts agreements and updates to reflect changes to existing agreements submitted in the past.  Issuers must also submit notifications when withdrawing an existing prepaid account agreement.  All submissions must occur within thirty days of the triggering event (e.g., the effective date of an amendment).

Because the Prepaid Rule requires submission to occur in the form and manner specified by the CFPB rather than according to requirements built into the Rule itself, prepaid issuers waited until recently for information regarding the submission process.  The CFPB’s submission implementation materials released in recent weeks define those requirements, particularly around use of the submission portal and technical specifications for document formatting.

Building the implementation materials and requirements into the Small Entity Compliance Guide will help prepaid issuers satisfy the account agreement submission requirements, particularly in light of the range of complex and nuanced new compliance challenges that issuers are simultaneously addressing now that the Prepaid Rule has come into force.

Copyright © by Ballard Spahr LLPNational Law Review, Volume IX, Number 120
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About this Author

Jacob Westlund, Ballard Spahr, Business attorney
Associate

Jacob Westlund assists banks, bank holding companies, and financial institutions with a range of matters, including transactions, commercial lending, bank lifecycle developments, regulatory requirements, and compliance issues. Jacob approaches his clients' needs with full awareness of the challenging regulatory environment in which financial institutions operate and the importance of efficient, reliable legal advice.

Prior to entering law, Jacob served at a large national bank where he was responsible for conducting a rigorous, enterprise-wide assessment of top...

612.752.1017
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