Financial Groups Remain Critical of Federal Complaint Database
In comments to the Consumer Financial Protection Bureau, groups representing banks and credit unions maintain that the current consumer complaint database remains a poor approach to handling consumer feedback—and they have some ideas to fix it.
The Consumer Financial Protection Bureau (CFPB) wanted feedback on its complaint database—and it got an earful.
In response to a plan by the CFPB to “normalize” the data provided to the public through the database, groups such as the Mortgage Bankers Association (MBA), the National Association of Federal Credit Unions (NAFCU), and the Consumer Bankers Association (CBA) continued to raise fundamental concerns but also offered feedback regarding how to improve it.
“While we strongly object to the public display of unsubstantiated complaint narratives in the database, MBA believes taking the several steps we recommend, including seeking further comment, could improve the database,” wrote Steve O’Connor, MBA’s senior vice president of public policy and industry relations, in a letter to the bureau earlier this week.
MBA claims that four-fifths of issues raised don’t require action beyond an explanation—and posting such complaints could mislead consumers.
The groups say the complaints in the database are often out of context and do not offer the full picture. Unlike a consumer-feedback service like Yelp, which includes both good and bad comments on a company’s service, the database publishes only negative comments. A more complete story would be more beneficial to consumers, the groups say.
“While industry has long advocated for normalization, we continue to be concerned consumers are being misinformed by unverified data; stress the importance of cautiously assessing how to properly normalize data; and urge the bureau to adopt informed disclosures to promote transparency in the marketplace,” the CBA wrote in the letter.
NAFCU Regulatory Affairs Counsel Kavitha Subramanian offered a similar opinion, as well as raising concerns about privacy.
“Through the current system, there remain serious concerns that personal information may be inadvertently released, jeopardizing an individual’s secure financial information,” Subramanian wrote, according to HousingWire.com.