Tuesday, September 20, 2011
FinCEN made this decision following comments it received from the industry that achieving compliance with the final rule by Sept. 27 would be a challenge. FinCEN said, "This effective date coincides closely with the back-to-school season and the start of the holiday shopping season, when retail sales and consumer traffic are at their peak.
"In anticipation of the industry's busiest time of the year, a 'lockdown' or freeze is routinely imposed on IT systems to facilitate the successful transaction of a heavy volume of business. This lockdown effectively bars any further changes to system operations until the completion of the holiday season, approximately the end of January of the following calendar year. For many businesses, this lockdown has either already occurred or will occur very soon."
FinCEN added that prepaid card providers may need to negotiate new agreements with distributors and retailers to clarify the status of their products and services under the new rules. However, providers are required to comply with the Sept. 27 date for "common business practices."
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