The Consumer Financial Protection Bureau (CFPB) announced several major updates to its consumer complaint portal. These updates build on prior changes to the CFPB portal and aim to address what the CFPB described as a “plague [of] issues that severely limit” the effectiveness and utility of the portal.
The changes
The CFPB announced seven changes to the system:
- Clarifying closure definition for consistency
As companies’ definitions for when a complaint is “closed with non-monetary relief” may vary, the CFPB issued a new Company Portal Manual offering guidance on the different response closure categories and answers to frequently asked questions to standardize data.
- Adding identity protections
The CFPB instituted two-factor authentication for users who create online accounts. It also added clarifying text and relationship categories to emphasize that third parties must disclose their involvement in the complaint process. Though not yet implemented, the CFPB plans to add address validation so companies can “act on high-quality information.”
- Reflecting statutory obligations
Based on its understanding that certain credit repair clinics and other individuals may be attempting to circumvent the Fair Credit Reporting Act (FCRA) framework to dispute incorrect or incomplete information, the CFPB added a notice informing consumers that they must first exhaust their dispute rights directly with consumer reporting agencies before filing a complaint. Though not yet finalized, the CFPB may also add an administrative response for credit reporting agencies to use when a consumer has not exhausted those rights before filing.
- Focusing on substantive complaints
The CFPB noted that companies have applied inconsistent standards for determining when a complaint warrants only an administrative response. The CFPB is working with the nationwide credit reporting agencies to develop guidance on when an administrative-only response is necessary and is considering expanding the available categories.
- Promoting consumer education
The CFPB is developing educational resources to inform consumers about the risks and costs of credit repair offerings and help them identify related scams.
- Developing new technology
The CFPB is developing new technology to share complaint data with companies more efficiently and use software, including address validation tools, to confirm that respondents are responding to the correct consumer.
- Redefining the ‘backlog’
The CFPB released a new definition for complaint backlogs. Previously, any complaint awaiting action – whether just received or dormant for weeks – was included in the CFPB’s “backlog.” Under the revised definition, complaints awaiting action for more than 30 calendar days after submission will be considered part of the backlog, while those pending for fewer than 30 days will be treated as routine works in progress.
What’s next?
Companies should continue to closely monitor their regulatory complaint intake systems and follow “Finsights” for additional updates to portal procedures, guidance and other modifications to the CFPB’s system.