CFPB Seeks to Allow Consumers to Air Complaints
Got a complaint about your bank or mortgage servicer? The Consumer Financial Protection Bureau (CFPB) is proposing that you be able to share it with the world.
The CFPB already fields complaints about an array of consumer financial products and the companies that provide them, including mortgage loans and servicing, credit cards, auto loans, student loans, banking accounts, credit reports, payday loans and more. Now it's suggesting that consumers who submit those grips should have the option to share them publicly.
When consumers currently file a complaint, they fill out an online form detailing the nature of the complaint, including a text box that allows them to include a narrative of what happened. The proposal would give them the option of publishing their complaint on the CFPB web site if they chose to do so.
Publication would be anonymous
"The consumer experience shared in the narrative is the heart and soul of the complaint," said Richard Cordray, CFPB director. "By publicly voicing their complaint, consumers can stand up for themselves and others who have experienced the same problem. There is power in their stories, and that power can be put in service to strengthen the foundation for consumers, responsible providers, and our economy as a whole."
Published complaints would be scrubbed of information that would personally identify the complainant, while any response from the business that is the target of the complaint would be featured along with it.
The CFPB currently uses the complaints to identify patterns of problematic behavior among companies that provide consumer financial products. They are also forwarded to the business that is the subject of the complaint, giving it an opportunity to respond while also prodding it to address the underlying issue.
Goals are to identify trends, spur competition
The CFPB suggests there would be several benefits to allowing complaint narratives to be made public. First, it would provide specific details about the complaint, providing greater context to the complaints and helping distinguish between different types of complaints grouped in the same category.
Making narratives public would also make it easier to spot developing trends of emerging issues, according to the CFPB, such as a pattern of overcharges for example, and seeing if they are related to a specific region, company or affiliate.
Other rationales listed by the CFPB are that public narratives would help consumers make informed decisions and spur competition among financial institutions to provide better customer service.
The proposed rule is now subject to a 30-day public comment period, after which the CFPB is required to consider possible modifications to the rule. It is not yet known when the rule, if approved, might take effect.
Follow us on Twitter and Facebook.
Wave of Home Equity Defaults Coming?
How Refinancing Can Hurt Insurance Rates