CFPB Releases Consumer Report After Reviewing 25,000 Public Comments

ARM industry credited with swiftly responding to 95 percent of complaints sent for review and response.

4/11/2019 11:00 AM

CFPB Releases Consumer Report After Reviewing 25,000 Public Comments

Following requests for information (RFIs) on complaint reporting practices and complaint inquiry handling processes, the Consumer Financial Protection Bureau released an informative report showing that by the end of 2018, only 1 % of debt collection complaints were pending with the consumer and 2 % were pending with the bureau.

The bureau received over 25,000 public comments on the RFIs related to reporting practices and handling processes, including comments from ACA International. ACA has long held the view that the bureau’s reporting and handling processes mischaracterize complaints against the accounts receivable management industry, particularly in reference to its failure to contextualize the number of complaints as compared to the number of contacts the debt collection industry makes to consumers over a given year.

While the media is quick to report a high level of complaints against the industry, ACA consistently reminds the media and other stakeholders that debt collection companies responded to approximately 95% of debt collection complaints sent to them for review and response last year.

According to the CFPB’s Consumer Response Annual Report, ARM companies closed 78% of complaints with an explanation, 12 % with non-monetary relief, and 1 % with monetary relief. Companies used an administrative response for 1% of complaints. At the end of 2018, 3% of complaints were pending review by the company. Companies did not provide a timely response for 5% of complaints, the report said.

“From January 1 through December 31, 2018, the bureau received approximately 329,800 complaints. Financial markets are complex, rapidly changing environments, which are best viewed over time,” CFPB Director Kathy Kraninger writes in her introduction to the report. “This annual report not only details the trends consumer response has seen through the lens of consumer complaints during the past year, but also compares them to trends observed in the prior year. Additionally, this report provides information about the bureau’s complaint handling process to provide context for the complaint analyses.”

Kraninger said in the report that the bureau continues to consider input from the public on the complaint reporting processes.

Other key findings from the report include:

  • The bureau received approximately 81,500 debt collection complaints in 2018 (25% of the total on all financial products or services) and a 3% decline from 2017. The bureau sent approximately 51,700 (or 63 %) of these complaints to companies for review and response, referred 27% to other regulatory agencies, and found 8% to be incomplete. At the end of 2018, 1% of debt collection complaints were pending with the consumer and 2% were pending with the bureau.
  • Of the total 329,800 complaints in 2018, the bureau sent approximately 264,100 (or 80 %) of these complaints to companies for review and response, referred 14% of complaints received to other regulatory agencies, and found 4 % to be incomplete. At the end of 2018, 0.4% of complaints were pending with the consumer and 1 % were pending with bureau.
  • Among other complaint types, credit or consumer reporting represent 38% of complaints, or 126,300, an increase of 27% since 2017; mortgages represent 9% of complaints, or 30,100, a decline of 19% from 2017; and student loans represent 3% of complaints, a decline of 48% from 2017.

“The insights we gain from our review will inform how our complaint program will evolve and how we will serve and interact with the program’s various stakeholders, including consumers, companies, and other regulators,” Kraninger said.

Read the complete report from the Office of Consumer Response.

Related Content from ACA International:

ACA Files Official Comments on BCFP’s Flawed Complaint Reporting Process  

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