The CFPB has issued its August 2015 complaint report, the second in its new series of monthly complaint reports. When it announced the launch of the new reports last month, the CFPB stated that each report would spotlight a particular product and geographic location. The August 2015 spotlights credit reporting complaints and complaints from consumers in the Los Angeles, California metro area.
Findings regarding complaints generally include the following:
- As of August 1, 2015, the CFPB has handled approximately 677,200 complaints, including 26,700 complaints in July 2015. Credit reporting complaints showed the greatest month-over-month increase, with the number of such complaints submitted by consumers in July 2015 up 56 percent from the number submitted in June 2015. Mortgage complaints showed the greatest month-over-month decrease, with the number of complaints submitted by consumers in July 2015 down 4 percent from the number submitted in June 2015.
- For July 2015, debt collection was the most-complained-about financial product or service, representing about 31 percent of complaints submitted (approximately 8,224 of the 26,704 complaints handled in July). The second and third most-complained-about products were, respectively, credit reporting and mortgages.
- Consumer loan complaints, which include pawn, title, and installment loans, increased 61 percent from the same time last year, up from a monthly average of 718 complaints from May to July 2014 to a monthly average of 1,154 complaints from May to July 2015. This was the greatest percentage increase by product. Bank account or services complaints showed the greatest percentage decrease (4 percent) by product over the same time period, decreasing from a monthly average of 1,976 complaints to 1,895 complaints.
- Hawaii, Maine, Georgia, and North Carolina experienced the greatest average monthly complaint volume increases from the same time last year (May to July 2014 as compared with May to July 2015), with Hawaii up 37 percent, Maine up 36 percent, and both Georgia and North Carolina up 33 percent. South Dakota, New Mexico, and Alaska experienced the greatest complaint volume decrease from the same time last year, with South Dakota down 31 percent, New Mexico down 16 percent, and Arkansas down 11 percent.
Findings regarding credit reporting complaints include the following:
- The majority of credit reporting complaints (77 percent) submitted to the CFPB involved incorrect information on reports. Among the claims frequently involved in such complaints were claims that a debt appearing on the report had already been paid, or was no longer due because it was beyond the applicable statute of limitations for bringing a lawsuit, belonged to another person, or was not recognized by the complainant.
- Consumers consistently reported issues related to accessing their credit reports as a result of online identity authentication questions.
- Public records appearing on credit reports were a source of concern, with consumers frequently mentioning delays in updating public records, problems correcting inaccurate records and public records being incorrectly matched to credit reports.
- Hawaii, Iowa and Ohio experienced the greatest percentage increase in the monthly average number of credit reporting complaints submitted between May to July 2015 as compared with May to July 2014 while Utah, South Dakota and Wyoming experienced the greatest percentage decrease in the monthly average of such complaints over the same period.
Findings regarding complaints from consumers in Los Angeles include the following:
- As of August 1, 2015, of the 94,000 complaints submitted by California consumers, 33,700 were submitted by consumers in the Los Angeles metro area.
- Mortgages were the product most-complained-about product, with mortgage complaints submitted by Los Angeles consumers constituting 35 percent of total complaints as compared to 28 percent of total complaints nationally.
- Credit reporting complaints and debt collection complaints constituted a smaller percentage of the total complaints submitted by Los Angeles consumers than those submitted by consumers nationally.
The August 2015 report, like the July 2015 report, identifies the top “most-complained-about companies.” As we have previously commented, until the CFPB adequately addresses the need for normalization of the complaint data, its lists of top “most-complained-about companies” will only serve to mislead consumers. And even if the CFPB addresses the normalization issue, we remain concerned that the monthly reports can still mislead consumers by failing to disclose that the CFPB has not vetted any of the complaints, let alone excluded complaints that have no basis in fact.