A group of 15 Democratic state attorneys general have submitted a letter responding to the CFPB’s request for information seeking comment on potential changes to the CFPB’s practices for the public reporting of consumer complaint information.  (Last month, a group of 35 Democratic U.S. Senators sent a letter to Mick Mulvaney and Leandra English urging the CFPB to continue to publicly disclose consumer complaint information.)

In their letter, the AGs indicate that since December 2012, state agencies have had access not only to the public-facing database but also to a secure portal that allows them to view information the general public cannot (such as complaint narratives which were not publicly disclosed until June 2015.)

The AGs state that the complaint database “has been an invaluable resource for identifying trends and patterns.”  They indicate that they “have used information gleaned from the CFPB’s database in connection with investigations into debt collection companies, student loan servicers, for-profit universities, and other companies whose misconduct was initially brought to our attention through a critical mass of complaints filed with the CFPB.”

The AGs also assert that in addition to being an invaluable resource in their investigations, the database “has proven useful to consumers at large.”  According to the AGs, the database:

  • Empowers consumers to educate themselves about financial decisions, options in the marketplace, and how to avoid bad actors
  • Because of its visibility, incentivizes companies to treat their customers fairly
  • Reveals patterns of widespread misconduct that “the CFPB and its state counterparts can use…to analyze the issue and determine what steps, if any, to take”
  • Represents “a commitment by the CFPB to honor not only the letter but the spirit of its statutory mandate to bring more transparency to consumer financial transactions by, inter alia, ensuring that corporate misconduct will not be shielded from view

The AGs close their lender by commenting that while they are submitting their letter with the expectation that the CFPB “will carefully weigh the comments it receives,” there have been press reports suggesting that the CFPB has already decided to end public disclosure of complaint data and that, if such reports are accurate, they suggest the RFI “is meant to paper over a decision already made.”  (The AGs specifically reference reports indicating that at an April 2018 American Bankers Association conference, CFPB Acting Director Mulvaney strongly criticized the CFPB’s policy of publicly disclosing consumer complaint information and suggested that the policy is likely to be discontinued.)