Consumer bureau to track complaints about bank credit cards
The Consumer Financial Protection Bureau's goal is to create a searchable database to provide consumers, businesses and advocacy groups an important financial product. It will be limited at first to credit-card complaints received since June 1 for banks with more than $10 billion in assets.
Los Angeles Times
WASHINGTON — The Consumer Financial Protection Bureau is launching a database that tracks which large banks have had the most complaints about their credit cards and how they were resolved — information some industry trade groups don't want made public.
The goal of the searchable database is to provide more information to consumers, businesses and advocacy groups about an important financial product, said Richard Cordray, the agency's director. It will be limited at first to credit-card complaints received since June 1 for banks with more than $10 billion in assets.
The beta version of the Consumer Complaint Database was made available Tuesday at the agency's website, www.consumerfinance.gov. The goal is to expand it by year's end to include more of the thousands of credit-card complaints for large banks the agency has received since it opened in July, Cordray said.
Eventually the agency wants the database to include complaints about mortgages and other financial products.
"Each and every time we hear from American consumers about their troublesome transactions with financial products, it gives us important insight. The information helps us, and it should be available to help others, too," Cordray said, calling the agency's database a major milestone for consumers. "By making our data publicly available, initially in the area of credit cards, we hope to improve the transparency and efficiency of this essential consumer market."
But some financial-industry trade groups have opposed making the database information public. The American Bankers Association said it would be a public "outing" of a bank's relationship with its customers based on "incomplete, unrepresentative and unverified" data.
"Disclosure of these complaints in a public database is going to be seen as government imprimatur of unverified complaints, the accuracy of which nobody can stand up and stand behind," said Richard Riese, senior vice president at the group's Center for Regulatory Compliance.
He also said it was unfair that the database won't cover smaller banks. The consumer bureau directly supervises only large banks for compliance with consumer protection laws.
Ed Mierzwinski, consumer program director for the U.S. Public Interest Research Group, said the database will help customers level the playing field with powerful companies.
"Nobody wants to be first on this list, so that means companies will improve their complaint handling, improve their responsiveness," he said.
The consumer bureau began accepting complaints about credit cards last July, and since then has started taking complaints about mortgages, private student-loan companies, and other bank products and services. From July 21 to June 1, the agency received 45,630 complaints, including 19,250 about mortgages and 16,840 about credit cards.
Most of the complaints are sent to the company, and financial firms have responded to 89 percent of the complaints they have received, the agency said. The most common complaints about credit cards have been about billing disputes. Credit-card companies have responded to 94 percent of the complaints sent to them. Consumers have disputed 16 percent of the company responses.