CFPB Monthly Complaint Snapshot Examines Debt Settlement, Check Cashing, and Other Financial Service Complaints

Report Includes Look at Consumer Complaints from New York State and the New York City Metro Area

WASHINGTON, D.C. – Today, the Consumer Financial Protection Bureau (CFPB) released its latest monthly consumer complaint snapshot, highlighting consumer complaints about financial services such as debt settlement, check cashing, money orders, and credit repair. The report shows that consumer complaints about these types of financial services generally revolve around issues of fraud or problems with reliable customer service. This month’s snapshot also highlights trends seen in complaints coming from New York State and the New York metro area. As of Jan. 1, 2016, the Bureau has handled over 790,000 complaints across all products.

“Many of the financial services examined in today’s report are used by people struggling to make ends meet who can least afford to have issues with their financial products,” said CFPB Director Richard Cordray. “The Bureau will continue to use complaints submitted about these products to target bad actors in the financial marketplace.”

The Monthly Complaint Report can be found at: http://files.consumerfinance.gov/f/201601_cfpb_monthly-complaint-report-vol-7.pdf

Product Spotlight: Other Financial Service

The CFPB offers “other financial service” as an option for consumers submitting a complaint that falls outside of one of the Bureau’s other major complaint categories. Some of the complaints that fall into this category are debt settlement, check cashing, credit repair, and money orders. As of Jan. 1, 2016, the Bureau had handled approximately 2,700 other financial service complaints. Some of the findings in the snapshot include:

  • Excessive fees for debt settlement and credit repair services: Of all complaints marked as other financial service, 60 percent of them were about problems consumers had when dealing with debt settlement and credit repair companies. These complaints often had to do with consumers being charged upfront fees when using these services. Charging upfront fees for these services is generally prohibited by existing law.
  • Problems redeeming money orders: Consumers who submitted complaints about money order issues frequently complained about the error resolution process they had to deal with, and the length of time it took to resolve errors related to their money order with customer service representatives.
  • Fraud when consumers use money orders and travelers checks: Consumers who submit complaints involving money orders and travelers checks often believe they have been the victims of fraud. These complaints generally involve common scams involving advance payment when promised goods are not delivered and services not rendered.

National Complaint Overview

As of Jan. 1, 2016, the CFPB has handled 790,000 complaints nationally. Some of the highlights from the statistics in this month’s snapshot report include:

  • Complaint volume: For December 2015, the three most-complained-about financial products were credit reporting, debt collection, and mortgages, together representing slightly over two-thirds—68 percent—of complaints submitted. Overall, the CFPB saw a 1 percent decrease in complaint volume between November and December 2015.
  • Product trends: In a year-to-year comparison examining the time periods of October to December, complaints about prepaid products rose 233 percent. Between Sep. 1 and Nov. 31, the CFPB received 459 complaints about prepaid products, mostly from one company.
  • State information: Of the five most populous states, Illinois displayed the sharpest rise—23 percent—in complaint volume during the same three month time period—October to December—between 2014 and 2015.
  • Most-complained-about companies: The three companies the CFPB received the most complaints about between August and October of 2015 were Equifax, TransUnion, and Experian. Company-level information should be considered in the context of company size and activity in the relevant market.

Geographic Spotlight: New York

This month, the CFPB highlighted New York State and the New York metro area for the report’s geographic spotlight. As of Jan. 1, 2016, consumers in the New York metro area—which comprises parts of New Jersey, Pennsylvania, and Connecticut as well as New York City—have submitted 57,700 of the 790,000 complaints the CFPB has handled. Consumers from New York State as a whole have submitted 50,400 complaints. Findings from the New York complaints include:

  • Mortgages are the most-complained-about product: Mortgages have been the most-complained-about product in New York State and the New York metro area. Of the 57,700 complaints submitted by consumers in the New York metro area, 27 percent have been related to mortgages. For New York State as a whole, 25 percent of the 50,400 complaints were mortgage related.
  • New York complaint volume mostly mirrors national trends: Although consumers in New York State (21 percent)and the New York metro area complain about debt collection at a lower rate than consumers nationally (26 percent), complaint volume about other financial products is similar to that on the national level.
  • Most-complained-about companies: JPMorgan Chase, Experian, and Equifax were the three most-complained-about companies from consumers in the New York metro area.

The Dodd-Frank Wall Street Reform and Consumer Protection Act, which created the CFPB, established consumer complaint handling as an integral part of the CFPB’s work. The CFPB began accepting complaints as soon as it opened its doors in July 2011. It currently accepts complaints on many consumer financial products, including credit cards, mortgages, bank accounts and services, private student loans, vehicle and other consumer loans, credit reporting, money transfers, debt collection, and payday loans.

The Bureau expects companies to respond to complaints and to describe the steps they have taken or plan to take to resolve the complaint within 15 days of receipt. The CFPB expects companies to close all but the most complicated complaints within 60 days.

In June 2012, the CFPB launched its Consumer Complaint Database, which is the nation’s largest public collection of consumer financial complaints. When consumers submit a complaint they have the option to share publicly their explanation of what happened. For more individual-level complaint data and to read consumers’ experiences, go to the Consumer Complaint Database at: www.consumerfinance.gov/complaintdatabase/

To submit a complaint, consumers can:

  • Go online at www.consumerfinance.gov/complaint/
  • Call the toll-free phone number at 1-855-411-CFPB (2372) or TTY/TDD phone number at 1-855-729-CFPB (2372)
  • Fax the CFPB at 1-855-237-2392
  • Mail a letter to: Consumer Financial Protection Bureau, P.O. Box 4503, Iowa City, Iowa 52244
  • Additionally, through “Ask CFPB,” consumers can get clear, unbiased answers to their questions at Ask CFPB.

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The Consumer Financial Protection Bureau is a 21st century agency that helps consumer finance markets work by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives. For more information, visit consumerfinance.gov.