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Consumer Financial Protection Bureau Settles with Remittance Transfer Providers for Remittance Transfer Rule Violations

WASHINGTON, D.C. — Today the Consumer Financial Protection Bureau (Bureau) entered into settlements with Trans-Fast Remittance LLC and Sigue Corporation and its subsidiaries, SGS Corporation and GroupEx Corporation. Trans-Fast, which until recently was a remittance transfer provider, is based in New York, New York and licensed in over 30 states. Sigue and its subsidiaries, which are all headquartered in Sylmar, California, provide consumers with international money-transfer services, including remittance-transfer services. The Bureau found that Trans-Fast and Sigue and its subsidiaries violated the Electronic Fund Transfer Act (EFTA) and the Remittance Transfer Rule, which implements EFTA. The Bureau also found that Trans-Fast violated the Consumer Financial Protection Act of 2010’s (CFPA) prohibition against deceptive acts or practices. The consent orders require the companies to pay civil money penalties and impose requirements to prevent future violations. Sigue and its subsidiaries must also pay consumer redress. These actions reflect a sweep of enforcement actions to address violations of the Remittance Transfer Rule.

The Bureau’s investigation of Trans-Fast found that it violated EFTA and the Remittance Transfer Rule by failing to adhere to error resolution requirements and properly respond to cancellation requests, failing to provide refunds the Remittance Transfer Rule requires, failing to maintain required policies and procedures, and failing to provide required disclosures. Since the 2013 effective date of the Remittance Transfer Rule, Trans-Fast provided about 40 million disclosures to consumers that violated the Remittance Transfer Rule. The Bureau also found that Trans-Fast engaged in deceptive acts or practices in violation of the CFPA by making misleading statements in advertisements regarding the speed of its remittance transfers and making misleading statements in disclosures purporting to limit consumers’ error resolution rights.

The Bureau’s investigation of Sigue and its subsidiaries found that between 2013 and 2019, they violated EFTA and the Remittance Transfer Rule. Specifically, the Bureau found that Sigue and its subsidiaries failed to refund transaction fees when they did not make funds available by the disclosed date of availability, and they failed to inform consumers of the remedies available for remittance errors. When Sigue and its subsidiaries investigated remittance errors, they failed to report to consumers in writing the results of their investigations into transaction errors or consumers’ rights as required by the Rule. Sigue and its subsidiaries also failed to develop and maintain adequate written policies and procedures designed to ensure compliance with certain Remittance Transfer Rule error-resolution requirements and failed to comply with several Remittance Transfer Rule disclosure requirements.

The consent order against Trans-Fast requires it to pay a $1.6 million civil money penalty. If Trans-Fast resumes offering remittance transfers, the consent order requires it to adopt a compliance plan to ensure that its remittance transfer acts and practices comply with all applicable Federal consumer financial laws and the consent order.

The consent order against Sigue and its subsidiaries requires them to pay about $100,000 in consumer redress and a $300,000 civil money penalty. They must also implement and maintain written policies and procedures designed to ensure compliance with the Remittance Transfer Rule and maintain a compliance-management system that is designed to ensure that their operations comply with the Remittance Transfer Rule, including conducting training and oversight of all agents, employees, and service providers, and not violating the Remittance Transfer Rule in the future.

The consent order against Trans-Fast Remittance LLC is available at: https://files.consumerfinance.gov/f/documents/cfpb_trans-fast-remittance-llc_consent-order_2020-08.pdf

The consent order against Sigue Corporation and its subsidiaries is available at: https://files.consumerfinance.gov/f/documents/cfpb_sigue-corporation_consent-order_2020-08.pdf

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The Bureau of Consumer Financial Protection is a 21st century agency that helps consumer finance markets work by regularly identifying and addressing outdated, unnecessary, or unduly burdensome regulations, by making rules more effective, by consistently enforcing federal consumer financial law, and by empowering consumers to take more control over their economic lives. For more information, visit consumerfinance.gov.