Consumer financial gripes posted on fed site
The Consumer Financial Protection Bureau on Thursday went live with an updated online database that includes more than 7,700 narratives from homeowners, loan recipients and others who provided first-hand narratives detailing their frustrations.
"US Bank/US Bank Home Mortgage has been unwilling to work with me to modify the terms of my home loan," an Illinois consumer wrote in one of the newly posted narratives. "I have consistently submitted all paperwork requested, all to no avail. They constantly lose the documents I send; send correspondence from all over the United States (oftentimes, not to me); no one can give me a status, stating instead that I am in underwriting."
The database, which does not disclose consumers' identities, indicates the complaint cited in the narrative ultimately was closed with an explanation to the consumer. U.S. Bancorp declined to provide a public response to be posted with the narrative, the database shows.
The consumer narratives, the first submitted and posted under a controversial plan finalized in March, will help the consumer agency analyze and respond to financial trends that affect many Americans, said CFPB Director Richard Cordray.
"Every complaint tells us what people are facing in the financial marketplace," he said. "Publishing these consumer stories today is a historic milestone that we believe will lead to better outcomes for everyone."
But Richard Hunt, president of the retail banking industry trade group Consumer Bankers Association, said he was "profoundly disappointed" with the online narrative posting.
"In my opinion, the vast majority of banks will choose not to respond publicly, but will continue the long held tradition of speaking with their customers in confidence," said Hunt, who called the CFPB action "simply a public shaming of banks."
The 3-year-old database currently contains more then 400,000 complaints submitted by consumers who are identified only by their U.S. Postal Service Zip codes. As of June 1, the CFPB said it had handled more than 627,000 complaints, with mortgages and debt collection the most frequent issues.
Consumers who opt to share their accounts send the CFPB detailed narratives describing the difficulties they faced and how their complaints were handled.
The consumer agency doesn't verify all facts in the complaints — a policy that's drawn financial industry criticism. Instead, the CFPB said it takes steps to confirm that consumers actually had customer relationships with the firms involved.
Companies receive the narratives from the consumer agency, and get an opportunity to select from a list of structured response options for public posting with the consumer complaints. The CFPB said it publishes the narratives after a company sends its public response, or after the firm has had the complaint for 60 calendar days, whichever comes first.
Banking industry representatives contend that posting the narratives online opens the way for undocumented claims that could unfairly tar a company's reputation.
"Publishing unverified complaints — not to mention narratives — on a government-sponsored website does nothing to help consumers make more informed financial decisions," Hunt wrote in an essay when the CFBP finalized the plan.
He suggested the CFPB should have followed the example of the U.S Department of Transportation, the Federal Trade Commission and other government agencies that "have means to verify or contextualize the complaints on their (electronic) portals."
He also said the CFPB database includes complaints only for the U.S. financial institutions it oversees — those with more than $10 billion in assets.
"The portal, therefore, ignores potential issues at 99% of depository institutions," wrote Hunt. "As a governmental agency, shouldn't the bureau provide the best data available, rather than just any data?"