On July 16th, 2014, the Consumer Financial Protection Bureau, CFPB, announced a proposal to disclose the narrative of borrower complainants to the public. Currently, consumer complaints are available through the Bureaus database, but information is limited to categorical information about the complaint (i.e. complaint id, etc. ).[1] If enacted, consumers could elect whether their complaints include their description of the problem. While in a hearing in El Paso, Texas, Director Cordray explained why it is important to include narratives in a complaints public record.

THE COMPLAINT DATABASE

The complaints database is accessible through the CFPBs website, https://data.consumerfinance.gov/dataset/Consumer-Complaints/x94z-ydhh , and each record contains broad categorical information: Complaint ID, Product, Sub-Product, Issue, Sub-issue, State, ZIP code, Form of SUbmission, Date received, Date sent to company, Company, Company response, Timely response, and Consumer disputed. The Bureau receives complaints via the web, postal mail and phone, and from 2011 to date, of the 395,300 complaints received, 20% are mortgage related.[2]

THE PROPOSAL

If enacted, consumers would be required to opt in in order to have the narrative publicly disclosed, and target businesses would have 15 days to respond. Director Cordray explained the inclusion of consumers narrative is critical for the analysis and understanding of these:

narratives contain the heart and soul of a complaint and provide vital information about why the consumer believes he/she was harmed

narratives provide a better picture when data is analyzed. This will help industry and policy makers when addressing related problems

narratives empower consumers and help them make better decision, and also encourage businesses to provide better products and services

POTENTIAL PROBLEMS

The response period of time poses potential problems, because target businesses need more than 15 days to investigate the complaints. Business may need to touch base with the consumer more than once to obtain all relevant information.

Like Heather Shull of Western Union, she expresses concerns about about the unreasonably short window of time to respond, I think 15 days is not enough time for us to adequately respond to complaints. I suggest this period be extended. The proposal is open for commentary.[3]

You can access the proposal and submit comments through here: https://www.federalregister.gov/articles/2014/07/23/2014-17274/disclosure-of-consumer-complaint-narrative-data

P.S. Days after I wrote this post, it came to my attention that Ms. Monica Jackson, CFPB Office of the Executive Secretary, issued a letter to the CFPB itself, requesting to extend the comment period for this rule. She requested an extension of 90 days to allow industry groups and other market participants to submit comments on this proposal.[4]

1) http://www.cfpbmonitor.com/2014/07/18/cfpb-hearing-in-el-paso-on-proposal-to-disclose-consumer-complaint-narratives-sheds-light-on-cfpb-position-reveals-concerns-of-financial-institutions/

2) http://files.consumerfinance.gov/f/201407_cfpb_report_consumer-complaint-snapshot.pdf

3) http://www.consumerfinance.gov/newsroom/cfpb-proposal-would-give-consumers-the-opportunity-to-publicly-voice-complaints-about-financial-companies/

4) http://www.cfpbmonitor.com/files/2014/07/Narrative-proposal-comment-letter.pdf

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