4/10/2017 1:00:00 PM
CFPB Office of Consumer Response Provides Updated Complaint Trends in Annual Report
The annual report shows a consistently high rate of timely responses from companies in 2016.
The Consumer Financial Protection Bureau’s Office of Consumer Response recently released its annual report with an overview and analysis of complaints received through the Consumer Complaint Database between Jan. 1 and Dec. 31, 2016.
The report also highlights the types of complaints the office has received since 2011 and how companies in financial services industries are responding.
As of March 2017, the CFPB has handled more than 1.1 million complaints about financial products and services, from mortgages and debt collection to student loans and credit reporting.
The CFPB’s Office of Consumer Response added debt collection complaints to the database in November 2013. It notes in a blog post on the report that financial companies continue to provide timely responses to consumers’ complaints. In 2016, 97 percent of complaints sent to companies had timely responses.
“Complaints are added to the database after the company responds to the complaint, confirming a commercial relationship with the consumer or after the company has had the complaint for 15 calendar days, whichever comes first. Complaints are not published if they do not meet all of the publication criteria,” according to the report.
In 2015, according to the report, the CFPB received 85,200 debt collection complaints, representing 31 percent of all complaints that year. By 2016, that number increased to 88,000 debt collection complaints for the year, or 30 percent of all complaints.
The CFPB received approximately 73 percent of all the complaints last year through the website, 7 percent via telephone calls, 12 percent from referrals and the remainder by mail, email and fax, according to the report.
Approximately 196,900, or 68 percent, of all complaints handled by the CFPB last year were sent by the Office of Consumer Response to companies for review and response, according to the report.
Also, an overwhelming majority of debt collection complaints were, and continue to be, solved amicably. According to report data, companies responded to approximately 94 percent of consumer complaints and 70 percent were closed with explanation for the consumer.
The most common complaints continue to be about attempts to collect a debt the consumer claims is not owed (41 percent), according to the report.
CFPB Plans Updates to Complaint Database and Portal
The CFPB’s database and portal serve as a primary interface for companies and the CFPB’s Office of Consumer Response if they have questions or concerns. The CFPB launched the public Consumer Complaint Database in 2012.
The CFPB has published more than 730,400 complaints sent to companies for a response, according to the report. Approximately 41,400, or 47 percent, of all debt collection complaints submitted to the CFPB in 2016 were sent to companies for review and response, according to the annual report. Remaining complaints were sent to other regulatory agencies (38 percent); found to be incomplete (10 percent); or are pending with the consumer or the CFPB (4 and 1 percent, respectively.)
“We do this not only to empower consumers and inform the public, but also so that companies can learn from the data and improve their own compliance and customer service operations,” CFPB Director Richard Cordray said in the Office of Consumer Response’s report. “In June 2015, the bureau started giving consumers the opportunity to share their descriptions of what happened, in their own words, so that others can read about, better understand, and learn from their experiences.”
The CFPB provided the option for companies to access the database and respond directly to complaints in 2014. In June 2015, the CFPB also added consumer complaint narratives to the public database, allowing consumers to share their experience in the financial marketplace in their own words.
The database includes more than 130,000 complaints where consumers chose to share their narratives with others, according to the report.
“Through the questions they ask us, the stories they tell us, and the complaints they submit, the voices of consumers remain foundational to the bureau’s work,” Cordray said in the report. “Many companies are adapting to this focus to become more directly responsive to consumer concerns, and thus to improve their customer service.”
Still, flaws in the CFPB’s Consumer Complaint Database and data methodology continue.
ACA International recently analyzed complaints submitted to the Consumer Financial Protection Bureau in a white paper, A Review of Debt Collection Complaints Submitted to the Consumer Financial Protection Bureau’s Complaint Database in 2016.
In the white paper, ACA argues that although the overall raw number of complaint submissions to the CFPB database appears high for the debt collection industry, once the data has been properly contextualized, the number of consumer complaints is remarkably low. Furthermore, while the complaints have limited utility as indicators of the compliance commitment of legitimate debt collectors, they can function as tools to spur continual improvement of existing debt collection practices.
ACA also asserts that the CFPB fails to contextualize the number of complaints lodged with the CFPB within the larger context of the debt collection industry. For example, ACA’s analysis shows the total number of debt collection complaints received by the CFPB represents an incredibly small number of consumers (0.004 percent) who had contact with the debt collection industry during 2016. Further, the complaints account for only .05 percent of all Americans estimated to have a debt in collection.
The findings suggest that while the overall raw number of complaint submissions appears high for the debt collection industry, once the data has been properly contextualized, the number of consumer complaints is remarkably low.
Overall, ACA International has continuously urged the CFPB to take steps to address its flawed consumer complaint handling process, including ensuring that the complaint information it shares in the consumer complaint database is based on meaningful, normalized data. In the white paper Methodological and Analytical Limitations of the CFPB Consumer Complaint Database, ACA showed that the flaws in the database – namely bias in the data collection process and incorrect characterization of complaints by industry – render the data near useless for policymaking or developing best practices.
In March, the Office of Consumer Response discussed changes to the complaint portal and database with the CFPB’s Consumer Advisory Board. Darian Dorsey, the CFPB’s deputy assistant director, Consumer Response, said during the meeting that about 75 percent of consumer complaints are submitted through the online complaint portal, ACA International previously reported. The CFPB also receives approximately 25,000 calls each month, which Dorsey said are primarily questions from consumers.
Dorsey said the CFPB’s Office of Consumer Response is continuing to focus on ensuring complaint information is accurate and that complaints are handled efficiently, meaning consumers receive a response within 15 days.
Changes to the database include consolidating multiple complaint forms into one to make it easier to make updates in the future; allowing a consumer to submit a complaint online without an email address; and providing consumers the option to inform the CFPB if they’ve already tried to resolve an issue directly with a company, Dorsey said.
The bureau announced that the launch date for the company portal upgrades will be the week of April 24, 2017.
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