Jacquelyn Martin / AP file
Knowledge is power, especially when it comes to making a financial decision such as applying for a loan or choosing a credit card.
That’s why the Consumer Financial Protection Bureau (CFPB) opened its database of complaints – 90,000 and counting – about problems with credit cards, mortgages, banks and private student loans.
In an interview with TODAY.com, CFPB director Richard Cordray encouraged consumers to file a complaint when they have a problem.
“It is very important to our work to be able to see the patterns of these complaints,” Cordray said. “It’s like a real finger on the pulse for us of what’s going on for consumers in the financial marketplace.”
Cordray told me he believes this information is also important for the business community.
“Good companies are carefully assessing complaint information and learning from that and improving both their products and their customer service,” he said.
Consumer advocates are pleased the CFPB is going public with its complaints.
“It allows consumers to be selective in seeking out financial providers and financial products,” said Pam Banks with Consumers Union, the advocacy arm of Consumer Reports. “If you were thinking about opening a bank account, you might want to check the database to see which banks have the most complaints and what type of complaints. That will arm you with the information you need to make a better and informed decision.”
(Red Tape Chronicles: Consumer watchdog unveils list of top lending gripes)
Here is more of my conversation with CFPB Director Richard Cordray.
Q: You give companies a chance to review the complaints and respond to them before you post them, but I know there’s been push-back. How do you respond to businesses that believe this is unfiltered information and that it’s not fair to let people post this sort of stuff?
Cordray: First, we’re working closely with industry and I think we’ve responded to a lot of their concerns. Second, I do think people need to toughen up a bit on this. This is the Internet age. There’s all kinds of information out there and good companies are monitoring all of that already.
This is also a matter of philosophy. At the Consumer Financial Protection Bureau we pride ourselves on being a 21st century agency. We have a bias toward being an open-data agency.
We don’t want to suppress information like this. It’s just information. You put it out there and everyone can have their own take on it. Everybody can make their arguments back and forth and people can kind of battle it out. What’s most persuasive will win out. That’s the court of public opinion and that’s where this should be fought out.
Q: A lot of government agencies ask people to file complaints because they want to build a database, but they don’t try to help the individuals who report the problem. What can someone expect if they file a complaint with the CFPB?
Cordray: We do try to address the complaints individually. We also benefit tremendously from the information in the aggregate.
We have a system set up to specifically work with companies to get these complaints resolved. Sometimes they merit resolution, sometimes they don’t. That’s always a judgment that has to be made case by case. But we do work with the company in the first instance.
We go back to the consumer and give them a chance to dispute the resolution and appropriate cases are then elevated to our investigations unit where different approaches can be taken depending on the facts and circumstances of the individual complaint.
We’re an agency that is working to get individual resolution where appropriate and in thousands of cases already we have managed to do that.
Sometimes it’s money relief, where they get money back or payments adjusted.
Sometimes it’s non-monetary relief that’s very important to people, like the woman I spoke to in Iowa recently. She was being constantly bombarded with harassing phone calls after her husband died and she took over the mortgage. We were able to get the calls to stop.
Sometimes it’s fixing things on their credit report.
Some of these problems loom very large for people and getting it resolved, knowing that somebody is trying to help them and really listen to them really means a lot to them.
The Consumer Financial Protection Bureau will start taking complaints about debt collection later this year. Director Cordray would like to see the agency handle complaints about even more types of financial products and services, such as payday loans.
Click here to file a complaint about: auto loan, bank account, consumer loan, credit card, credit reporting, money transfer, mortgage or student loan.