CFPB Reports Consumer Complaints Growing, Will Drive Regulation
|January 23, 2014|
The Consumer Financial Protection Bureau (CFPB) continues to receive an increased amount of complaints per month as more consumers learn about the federal agency.
Speaking at the U.S. Conference of Mayors, CFPB Director Richard Cordray reported that the bureau has received more than 270,000 consumer complaints. The CFPB received about 600 complaints in its first month, but that volume has increased to 15,000 last month.
“As people become more aware of us, we expect to continue to receive even more complaints,” Cordray said. “That is helpful to us because these complaints give us insight into what is happening to consumers around the country, right now.”
More than 40 percent (109,000) of all the complaints received deal with mortgages, while the CFPB has received more than 27,000 complaints about credit reporting and more than 31,000 about debt collection.
“When the president and the Congress created our new agency, they gave us a crucial means of helping individual consumers,” Cordray said. “We take complaints about a wide range of products and services that people use every day, and where too often they find themselves being mistreated. Each perceived grievance is a chance for us to get a better handle on a problem and see if it can be addressed successfully. That may mean getting some or all of the consumer’s money back. It may mean fixing or clearing up a mistake or some other kind of problem.”
In June 2013, the CFPB issued a bulletin in June regarding responsible business conduct and provides insight into the Bureau’s mission and further supports the importance of resolving consumer complaints.
The seventh pillar of ALTA’s ”Title Insurance and Settlement Company Best Practices" addresses policies and procedures regarding consumer care and customer complaints. Having a process for receiving and addressing consumer complaints helps ensure reported instances of poor service or non-compliance do not go undiscovered.
ALTA held a Title Topics webinar last year that offered tips on how to develop procedures for handling consumer complaints.
Each complaint the CFPB receives is individually processed and typically forwarded via a secure web portal to the appropriate company, “which reviews the information, communicates with the consumer as needed, and determines what action to take in response,” Cordray said.
Companies are required to address the issue on a fairly quick time frame. Consumers are encouraged to contact the CFPB if they are not satisfied with the company’s answer. The CFPB reviews the feedback, including the timeliness of the company’s response, to prioritize complaints for investigation.
“Complaints are not only opportunities for us to help specific people; they also make a difference by informing our work and helping us identify and prioritize problems. We know that if we hear about a particular problem from 50 consumers, it likely looms larger than if we hear about it from two. We know that if we begin to see a disturbing trend, we should consider allocating some of our limited resources to combat that particular problem.”
Cordray called consumer complaints the bureau’s compass and enables the agency to hear consumer issues and address them immediately instead of years later when reports or studies are completed.
“Each consumer’s voice counts, and the chorus of many voices can change practices at these companies,” he added. “We can send our examiner teams inside the companies to fix systemic problems, and we can use our enforcement teams to investigate, clean up, and deter violations of the laws.”