Consumer Bureau Looks to End Public View of Complaints Database

When he contacted Midland, a representative suggested that he simply pay off the balance owed, Mr. Perry said. So he filed a complaint with the consumer bureau.

Thirteen days later, Midland sent Mr. Perry a letter: “Midland Credit apologizes for the inconvenience caused to you.” The collection firm agreed to close the disputed account, end collection efforts on it and instruct the credit bureaus to delete the record from their files.

“I don’t spend a lot of time feeling grateful to the federal government, but I was really grateful to the C.F.P.B. at that moment,” Mr. Perry said. “We need more accountability and transparency from our financial institutions, not less.”

Financial institutions, however, say the database can be misleading because the agency publishes a record of all the complaints that it receives, without vetting them. The companies also argue that they already have channels for resolving customer disputes.

“Publishing unverified complaints — or, worse, using those complaints to paint a picture of guilt in the public domain — is irresponsible,” said Richard Hunt, the chief executive of the Consumer Bankers Association.

Mr. Mulvaney’s disdain for the complaints database has already lessened its use. The New Economy Project, a community organization, has shifted its focus to reporting disputes to other regulators, including New York’s attorney general and the state’s Department of Financial Services.

“When Mulvaney stepped in, we saw the writing the wall and stopped advising our clients to file C.F.P.B. complaints, which anyone paying attention to what’s going on at the agency can see would be an exercise in futility,” said Sarah Ludwig, the New Economy Project’s founder and co-director.

A bureau spokesman declined to comment further about the agency’s plans for the complaints database. Last week, the agency put out a public call for feedback on its complaint process — a standard precursor to making changes.

Article source: https://www.nytimes.com/2018/04/25/business/cfpb-complaints-database-mulvaney.html?partner=rss&emc=rss