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From Banking and Finance Law Daily, October 27, 2015

Credit cards are the focus of CFPB’s latest complaint snapshot

By John M. Pachkowski, J.D.

The Consumer Financial Protection Bureau has released its latest monthly snapshot of consumer complaints. The monthly snapshot includes complaint data on company performance, complaint volume, state and local information, and product trends. Also, the snapshot spotlights a particular product and geographic location.

For its fourth snapshot, the CFPB has highlighted credit cards and complaint trends coming from the Chicago metro area.

National trends. As of Oct. 1, 2015, the bureau has handled 726,000 complaints nationally. For the month of September 2015, the most-complained-about financial product or service was debt collection, representing about 29 percent of 23,354 complaints submitted during that month. The second-most-complained-about consumer product was credit reporting.

In a year-to-year comparison, complaints about debt settlement, credit repair, and check cashing, considered to be “other financial services complaints,” showed the greatest percentage increase. Complaints about these products rose 97 percent from the same time period last year.

Focusing on state trends, the snapshot noted that Idaho has the greatest complaint volume increases from the same time last year by a wide margin, while the next largest complaint volume increase was from Nebraska.

Finally, the most complaints were lodged against Equifax, Experian, and Bank of America.

Credit cards. Of the approximately 79,500 credit card-related complaints filed by consumers with the CFPB as of Oct. 1, 2015, the most frequent complaints centered on:

  • confusion over how late fees are assessed;

  • problems resolving inaccuracies on billing statements; and

  • accounts closed without consumer consent.

Citibank, Capital One, GE Capital Retail, and JPMorgan Chase accounted for nearly 60 percent of credit card complaints submitted to the bureau between May and July 2015. Of these companies, Citibank received 708 complaints during this time period. The CFPB uses a three-month rolling average of complaints sent to companies for response. This company-level complaint data lags other complaint data by two months to reflect the 60 days companies have to respond to complaints, confirming a commercial relationship with the consumer.

Geographic spotlight. Of the 726,000 total complaints received by the bureau, 21,000 of them have come from the Chicago metro area, which is comprised of nearly 10 million people residing in Illinois, Indiana, and Wisconsin.

The spotlight on the Chicago metro area found that:

  • mortgages are the most-complained-about product; and

  • Chicago complaint volume and type mirror national trends.

In addition, credit reporting companies TransUnion, Equifax, and Experian were the first, second, and, fourth most-complained-about companies by Chicago-area consumers over a 12-month period. The third-most-complained-about company by Chicago-area consumers was JPMorgan Chase.

Protect people. Commenting on the snapshot, CFPB Director Richard Cordray said, “Credit cards are an important financial tool for over half of the adults in this country. It is important for consumers to be able to control how their payments are applied and to have clear information about their rights as cardholders. The Bureau will continue to work to protect people as they are using credit cards.”

Companies: Bank of America; Capital One; Citibank; Equifax; Experian; GE Capital Retail; JPMorgan Chase; TransUnion

MainStory: TopStory CFPB ConsumerCredit CreditDebitGiftCards DoddFrankAct FairCreditReporting Mortgages

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