Informing All Financial Customers: Consumer Protection Agency Expands Complaint Database
by Gavin Baker, 3/28/2013
The Consumer Financial Protection Bureau (CFPB) announced today that it will expand its online public database of customer complaints to include additional financial services that the bureau regulates. Previously, the database had included only complaints about credit cards. Under the new policy, the CFPB will disclose complaints it has received from consumers about mortgages, bank accounts and services, private student loans, and other consumer loans.
Expanding the database will better enable customers to research their financial options and avoid bad actors. The new policy continues the CFPB's rigorous and innovative approach to transparency, which should be a model for other federal agencies.
About the Database
The complaint database allows consumers to view data about other customers' experiences in order to avoid abusive practices and poor customer service. This information empowers Americans to make more informed choices about financial services. In addition, greater transparency creates an incentive for companies to improve their business practices.
We have repeatedly supported the consumer complaint database and encouraged the agency to expand it to include additional types of complaints:
- In May 2011, we joined a letter encouraging the CFPB to disclose consumer complaints.
- In January 2012, after the bureau proposed disclosing complaints about credit cards, we noted that the bureau also collects complaints about mortgages and other financial services and added, "we encourage the CFPB to disclose complaints about these other products as well" as credit cards.
- In July 2012, we joined a comment which encouraged the CFPB "to swiftly expand access to the database for all types of financial service complaints."
Aspects of the Policy
The CFPB’s new policy includes other helpful changes to the information it will post with each complaint. The bureau will disclose more detailed information about the type of product involved in a complaint. For instance, rather than simply referring to a mortgage account as a "mortgage," it will specify the type of mortgage, such as "reverse mortgage." In addition, the CFPB will add to the database the date it received a response from a company about a complaint, which will let customers assess companies' timeliness in resolving issues.
Protecting Customers through Information
People need more and better information about how financial institutions treat their customers. As Congress recognized in the Dodd-Frank Wall Street Reform and Consumer Protection Act – which created the CFPB – without effective safeguards, the risks to both individuals s and the financial system are huge. Abusive practices by lenders can unfairly saddle consumers with debt and imperil families’ economic security for years. If such practices become widespread, the entire system risks collapse, as we saw vividly just a few years ago. We applaud the CFPB's efforts to make its complaint database even more useful to everyday citizens, by sharing information that will help people protect themselves against predatory lending practices of all kinds.