November 20, 2017

November 20, 2017

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November 17, 2017

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CFPB Releases “Special Edition” of Monthly Complaint Report

On June 27, 2017, the CFPB released its monthly complaint report.  As opposed to its typical monthly complaint reports, which highlight broad trends in complaints and focus on specific products and services as well as regions, this month’s “special edition” report provides overall statistics on complaints the CFPB has received since it began accepting complaints in July 2011.  The report provides details on, among other things, the total number of complaints received (1,218,600 as of June 1, 2017), the volume of complaints from service members and older consumers (groups that, as exemplified in the preceding hyperlinks, are of particular interest to the CFPB), the percentage of timely company responses, and the most complained about products and services.  The report provides statistics at a national level and for each state and the District of Columbia.

Among the highlights from the “special edition” report:

  • Complaint volume rose 7 percent between 2015 and 2016: The Bureau reports receiving 291,400 complaints in 2016, an increase over the 271,600 complaints it reported receiving in 2015. Part of this increase is likely attributable to the fact that the CFPB began accepting complaints regarding federal student loan servicing on February 26, 2016.
  • Companies have provided a “timely” response to 97 percent of complaints they received from the CFPB: Nearly all complaints are responded to in a timely manner. The CFPB considers a response timely if the company responds to a complaint within 15 days.
  • More than half of the consumers submitting complaints grant permission for the CFPB to publish their narrative: Since the CFPB began providing consumers with a platform to share their complaints publicly in July 2015, 52 percent of consumers who have submitted complaints directly to the Bureau have opted to share the narrative descriptions of their concerns. According to the CFPB, these often detailed, but unverified, complaints “can help consumers learn from problems that others experience” and “also serve to help encourage companies to improve the overall quality of their products and services and more vigorously compete over good customer service.”
  • Debt collection and mortgage complaints account for half of complaints submitted: The CFPB reports that debt collection and mortgage-related complaints account for 50 percent of the complaints it has received.  The report notes that although the Bureau began accepting debt collection complaints only in July 2013—two years after beginning to accept complaints—debt collection has been the most complained about category of product or service, with approximately 316,810 complaints to date, or 27 percent of all complaints. The Bureau highlighted that these complaints include allegations of attempts to collect on debts not owed by consumers and of repeated phone calls from collectors. As for mortgage complaints, since the CFPB began accepting this category of complaints in December 2011, it has received approximately 272,153 such complaints, or 23 percent of all complaints. The Bureau highlighted that this category includes allegations of problems experienced in dealing with servicers when consumers face difficulties in making payments.

The complaints database has long been a point of controversy, particularly the publication of the unverified complaint narratives that may create reputational harm based on allegations that are untrue, one-sided, or otherwise lacking in important context. Notably, the version of the Financial CHOICE Act recently passed by the U.S. House of Representatives would specifically prohibit the publication of complaints, and the Treasury Department’s recent regulatory reform proposals similarly recommend that the complaint database remain confidential.

© 2017 Covington & Burling LLP

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About this Author

Luis Urbina, Covington Law Firm, Financial Regulations Attorney
Associate

Luis Urbina advises clients on state and federal financial regulations. He assists banks, lenders, and technology companies with regulatory issues including bank chartering and compliance with consumer protection laws. He monitors developments regarding the Consumer Financial Protection Bureau (CFPB) and regarding the deployment of fintech services, including those dependent on blockchain technology.

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