Consumer bureau expands complaint data
Consumers shopping for a credit card or checking out a debt collection agency have a new trove of material to research.
The Consumer Financial Protection Bureau began publishing
consumer complaints on its website Thursday.
The initial batch of 7,700 concerned mortgages, bank accounts, credit cards,
debt collection and other financial products -- or headaches, depending on your
point of view.
"Every complaint tells us what people are facing in the financial marketplace," CFPB Director Richard Cordray said in a news release.
Consumers can search the complaints by brand names or product features, or look for instances of terms such as "lost paperwork" or "foreclosure scam," the consumer protection bureau said.
The agency launched its Web-based complaint database in 2011 with information about credit card gripes, adding more products since then. But instead of publishing the consumer's actual complaint about what happened, the database summed up the issue under a broad description such as "billing dispute" or "credit determination."
The complaints that started being published Thursday add meat to the bare-bones descriptions.
One holder of a Wells Fargo credit card said he or she wasn't allowed to pay off the balance on the card before the bank hiked the rate to 30 percent, from 12 percent. "Had they given me that option, I would have frozen the account and it would be paid off today, as it has a limit of $2,500," the Oregon resident said. "I need help. The fee for the nonprofit counseling center Wells Fargo sent me to is higher each month than the 30 percent interest!"
Consumers must opt in for their stories to be published, and the agency keeps their names and identifying details confidential.
Wells Fargo opted not to make a public response to the complaint, according to the database. The complaint is marked "closed with explanation," and the consumer hasn't filed a dispute of the bank's private response.
Consumers and researchers can use the stories to spot trends in companies' behavior, the CFPB said. Airing the complaints openly should increase the competitive pressure for financial services to avoid practices that produce miffed customers, and to provide effective customer service. The CFPB also Thursday issued a request for information on ways to make its database easier to understand and use, particularly for making comparisons.
"The CFPB did the right thing today, by rejecting the most extreme bank red herrings but also allowing firms to offer rebuttal stories of their own," Ed Mierzwinski, consumer program director at the U.S. Public Interest Research Group, said in an email response to questions. Adding stories strengthens the data for consumers shopping for products, and for researchers tracking companies' performance, he said.
Publishing unverified one-sided narratives does not benefit consumers. The CFPB prides itself on being a data-driven agency, but today's action is simply a public shaming of banks.
CEO, Consumer Bankers Association
Companies targeted by complaints have the option to select a public response that appears below the consumer's version of events. But an initial review of about 100 complaints found that few companies chose to speak up for themselves.
Consumers with a financial service problem that isn't resolved by the company can lodge a complaint with the CFPB on the Web, or by phone at 855-411-2372. The agency currently tracks complaints about credit cards, bank accounts, consumer loans, credit reporting, debt collection, money transfer, mortgages, payday loans, prepaid cards, student loans and vehicle loans.
When a complaint comes in, the agency contacts the company and verifies the gripe comes from a customer. Companies may dispute the facts, stand by their actions, or respond with a refund or "nonmonetary relief," such as the correction of information on a credit report. If the company doesn't respond, basic complaints are held for 15 days before publication, while detailed stories are held for 60 days.See related: Complaints data show which cards pay refunds most, least often
- Credit card APRs to rise again as Fed raises benchmark rate a quarter point – The Federal Reserve raised its federal funds rate a quarter point for the second time this year, meaning higher rates for variable rate credit cards ...
- How to report and protect yourself from credit card fraud and identity theft – Here are some good tips and resources to keep yourself protected from credit card fraud and identity theft ...
- Bill that could help prevent synthetic ID fraud passes Congress – Banks will have new tools to fight synthetic identity fraud under a bill headed to President Trump's desk ...