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Remarks by Richard Cordray on the Consumer Complaint Database

Remarks by Richard Cordray
Director of the Consumer Financial Protection Bureau

Press Briefing on Consumer Complaint Database

June 19, 2012

Thank you all for joining us. As you know, the Consumer Financial Protection Bureau was created because Congress recognized that consumers deserve to have someone to stand on their side, protect them against fraud, and ensure that they are treated fairly in the financial marketplace.

One of our key tools to accomplish that task is our ability to receive and process consumer complaints, which allows us to hear directly from consumers about their concerns and frustrations. Our direct relationship with the American consumer will always bring us back to our essential mission.

The Dodd-Frank Act requires us to establish a Consumer Response unit; the law also says we may make information available in the public interest. We believe the disclosure of this data not only serves the public interest, but promotes the advancement of the free enterprise system.

We know that many of you have waited patiently for access to this consumer complaint information. So we are happy to announce two things: first, that we have finalized our credit card complaint data disclosure policy; and second, that we are launching a beta version of our credit card complaint database. We are starting with credit cards because, as you may recall, it was the first financial product that we addressed with our new consumer complaint system.

The Consumer Complaint Database is a major milestone for consumers and all those who are interested in knowing more about their day-to-day experiences. We believe this is the first time that the general public has been able to see such individual-level consumer complaint data for financial products and services. We intend to make this data widely available to consumers, advocacy groups, businesses, policy makers, and journalists. Anyone with access to the web will be able to review and analyze the information, and draw their own conclusions.

Within the Consumer Bureau itself, the information we have been gathering is very valuable, as it helps to inform our supervisory exams, enforcement actions, and rulemaking. Indeed, Congress authorized us to develop our priorities out of this data, which reinforces its potential value to the broader public.

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. 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.

The Consumer Complaint Database will contain credit card complaints received by the Consumer Bureau on and after June 1. Additional retroactive data will be added when we remove the “beta” tag by the end of this year.

Importantly, the database will be timely, understandable, and easily searched. You will be able to dig for information in various ways, including by company name or consumer zip code or subject matter.

And just to be abundantly clear, we are not disclosing personal information like consumer names, credit card numbers, or addresses. We absolutely respect consumer privacy and confidentiality.

You may be aware that as soon as we started taking credit card complaints on July 21, 2011, people started asking for them. Partly in response to this demand, last fall we asked the public to tell us what they thought about making our credit card complaint data publicly available. The beta version of the Consumer Complaint Database we are announcing is a direct result of that process.

This Consumer Complaint Database is a beta version because we anticipate refinements and additions. We are considering expanding it to include additional data fields and visualization tools. As we think about whether and how to expand the information we make public, we want you to help us test it. We want your feedback.

We know there is great interest in all the consumer complaints we receive. So, in addition to the informal feedback we are seeking, we are also publishing a formal request, through the Federal Register, for people to share their views about expanding this database to the other financial products and services that we deal with in our work.

And, finally, to provide greater context on all of the consumer complaints and inquiries that we get every day at the Consumer Bureau, we are releasing the latest snapshot report of the complaints that we received in our first ten months of operations. As many of you know, we have been publishing regular reports containing aggregate complaint data, including mortgages, bank products, and private student loans – the product categories that followed credit cards in our process of accepting complaints in stages. Now we are releasing a similar report.

The snapshot includes some examples of people who we have helped and who have agreed to make their stories public, like Ronald from Georgia, a 77-year-old former Army soldier and retired businessman. Ronald believed he had paid off his mortgage, but could not prove it. Ronald, who bought his home in 1979 for $38,000, was blind and had trouble finding the paperwork to show he owned his home free and clear. So he diligently continued to hand over $100 each month to the lender. After the Consumer Bureau got involved in his case at the end of 2011, the bank determined that Ronald had in fact paid off his mortgage in 2007. The bank refunded Ronald’s money with interest and sent him a check for $30,000.

Another consumer who contacted us was Greg from Michigan. When Greg moved his elderly mother into an assisted living facility, he added his name to his mother’s checking account. Seven months later, he became the mistaken target of a collection agency for unpaid fees related to an error made by his mother’s bank. Greg tried repeatedly to clear up the misunderstanding directly with the bank but to no avail. Compounding the anxiety and frustration he suffered, his credit score was unfairly damaged. Then Greg heard about us and decided to file a complaint. After we brought his story to the bank’s attention, the bank promptly apologized for their error, called off the collection agency, and fixed Greg’s credit score.

Now, these are just two examples of the thousands of people that our Consumer Response team has helped. It has not even been a year and we have already handled more than 40,000 such complaints, coming at an accelerating pace. For every consumer who reaches out to us to tell us about their troubles, we know that many others have the same troubles but suffer them in silence. Nobody needs to be told there are deep problems in the consumer financial product marketplace – it is why we were created in the first place. But these complaints tell us personal stories of real pain – and they reinvigorate us to keep moving forward with the hard work we do every day.

So, again, I encourage you to check out the beta version of our Consumer Complaint Database. Do your own digging. Find your own information. And help us make the marketplace a better and safer place, not only for consumers but for responsible businesses as well. Thank you.