CFPB complaints skyrocket as credit reporting issues again top the list Posted by AVCU on 8:25 AM

 More than a half million consumers flooded the Consumer Financial Protection Bureau with complaints last year — and while some of the complaints were pandemic-related, the vast majority cited inaccurate information on credit reports.

Complaints to the CFPB jumped 54% to 542,300 in 2020, according to an annual report to Congress that the bureau released Wednesday.

During the pandemic, the bureau has issued bulletins analyzing thousands of complaints it has received mentioning coronavirus and related terms. “The pandemic has been among the most disruptive long-term events we will see in our lifetimes,” CFPB Acting Director Dave Uejio said in a press release. “Not surprisingly, the shockwaves it sent across the planet were felt deeply in the consumer financial marketplace.”

Yet those complaints amounted to 5.9% of the total. Credit and consumer reporting have consistently topped the CFPB’s list of complaints for years and accounted for nearly 60% of all complaints last year, up from 44% in 2019.

A significant portion of the complaints in 2020 involved attempts to address identity theft-related issues, according to the CFPB. It said it plans to issue a separate report later this year about the handling of complaints by the three big credit bureaus: Equifax, Experian and TransUnion. The companies did not immediately respond to requests for comment.

While the credit bureaus typically provide detailed responses to complaints, the CFPB said they “stopped providing complete and accurate responses” to many complaints. Instead, the bureaus noted that a dispute was filed but “otherwise failed to address the issues consumers raise in their complaints.”

The CEO of the Consumer Data Industry Association — a trade group whose members include Equifax, Experian and TransUnion — blamed "predatory" credit-repair companies for inflating the number of complaints against credit bureaus.

"They essentially spam the [CFPB's] complaint portal, making it difficult to help consumers with legitimate problems," Francis Creighton said in an email to American Banker.

The industry with the second-highest complaints was debt collection at 15% of all complaints last year.

Last month, Uejio called out financial firms generally for dragging their feet in responding to complaints. He also said the bureau plans to analyze disparities in how companies address complaints from minorities compared with those of white consumers.

"The CFPB expects companies to respond to these concerns and that consumers receive responses from companies that address the issues consumers raise in their complaints," Uejio said in the release Wednesday.

The biggest concern for banks and financial services providers is that the CFPB will use complaint data to target companies for supervisory and enforcement actions. The CFPB typically sends consumer complaints directly to companies, which generally are required to respond within 15 days.