The Consumer Finance Protection Bureau is launching a consumer complaint database – a move that’s upset the nation’s banking industry.
In a move that dismays the banking industry, the federal Consumer Finance Protection Bureau is now openly sharing information on credit card disputes through a new Consumer Complaint Database.
“Our goal is to improve the transparency and efficiency of the credit card market to further empower American consumers,” Scott Pluta, CFPB chief of staff, said in a statement released today. According to Pluta, the Consumer Complaint Database provides a “data-rich window into consumer financial issues” for the public, policy makers and members of the media and finance industry.”
The Consumer Complaint Database – still in preliminary stages – initially includes credit card complaints, but the bureau proposes expanding the database to include all financial products and services it covers, including mortgages, student loans and checking and savings accounts.
The data is collected by the bureau’s Consumer Response team, which checks to see that the complaints are complete and not duplicative, before forwarding them to the appropriate financial institutions. Companies have 15 days to respond to each consumer complaint, and are expected to resolve all but the most complicated complaints within 60 days. Consumers can dispute a resolution and are asked to do so within 30 days of receiving a company response.
The bureau has received roughly 45,630 consumer complaints between July 21, 2011, and June 1, 2012, according to a CFPB report. Of these, about 16,840 are related to credit cards, 19,250 to mortgages, 6,490 to bank products and services, and 1,270 to private student loans. As of June 1, companies have responded to 89 percent of the complaints, and consumers have disputed 19 percent – about 5,940 – of the company responses.
The move to make this process more transparent through a Consumer Complaint Database is “disappointing,” according to Kenneth Clayton, executive vice president of legislative affairs and chief counsel for the American Bankers Association, who says unverified consumer complaint data could mislead consumers and tarnish a company’s reputation without substantiation. (Millionaire Corner research shows large banks remain popular with affluent investors.)
“Publishing allegations is often different that publishing facts,” Clayton said in a statement released by the ABA today. “It feeds the perception that the bureau wishes to politicize the process rather than analyze the facts involved.”
Clayton noted that complaints have been filed on less than .01 percent of the 383 million credit card accounts in the United States. A consumer complaint can be filed online or via telephone, mail, email, fax and referrals from other agencies.