CFPB Monthly Complaint Snapshot Spotlights Debt Settlement, Check Cashing, and Other Financial…
November 30, 2016 / Source: CFPB
WASHINGTON, D.C. – Today the Consumer Financial Protection Bureau (CFPB) released a monthly 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 report also highlights trends seen in complaints coming from Oklahoma. As of Nov. 1, 2016 the Bureau has handled approximately 1,035,200 complaints across all products.
“The products and services highlighted in today’s report are often utilized by people working 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 examine complaints submitted about these products to target bad actors in the marketplace.”
The Monthly Complaint Report can be found at: http://www.consumerfinance.gov/data-research/research-reports/monthly-complaint-report-vol-17/
Category Spotlight: Other Financial Services
When consumers submit a complaint that falls outside one of the Bureau’s major complaint categories, their complaint is listed under the category “other financial service”. The types of complaints that make up this category include debt settlement, check cashing, credit repair, and money orders. As of Nov. 1, 2016, the Bureau had handled approximately 4,500 complaints about these types of financial services. Some of the findings in the snapshot include:
Majority of complaints were related to fraud or scam: Of the approximately 4,500 “other financial service” complaints the Bureau has handled, more than half—51 percent—have involved a fraud or scam as the consumer’s primary issue. These complaints generally had to do with consumers dealing with debt settlement companies.
Debt settlement was the most complained about “other financial service”: Problems with debt settlement services made up half—50 percent—of “other financial service” complaints submitted to the Bureau. Consumers complained that payments they made to debt settlement companies were never forwarded to their creditors and as a result they faced lawsuits for unpaid accounts.
Consumers complain of trouble redeeming money orders: Consumers complained of difficulty redeeming money orders, with the orders being returned to them as invalid or fraudulent. When the consumers attempted to resolve the issue with the money order company, they complained of delays that resulted in them not being reimbursed for the value of the money order.
National Complaint Overview
As of Nov. 1, 2016 the CFPB has handled approximately 1,035,200 complaints nationally across all products. Some of the findings from the statistics being published in this month’s snapshot report include:
Complaint volume: For October 2016, debt collection was the most-complained-about financial product or service. Of the approximately 27,000 complaints handled in October, there were 7,749 complaints about debt collection. The second most-complained-about consumer product was credit reporting, which accounted for 5,369 complaints. The third most-complained-about financial product or service was mortgages, accounting for 4,357 complaints.
Product trends: In a year-to-year comparison examining the three-month time period of August to October, student loan complaints showed the greatest increase—108 percent—of any product or service. The Bureau received 1,272 student loan complaints between August and October 2016, while it received 612 complaints during the same time period in 2015.
State information: Alaska, New Mexico, and Missouri experienced the greatest year-to-year complaint volume increases from August to October 2016 period versus the same time period 12 months before; with Alaska up 53 percent, New Mexico up 33 percent and Missouri up 31 percent.
Most-complained-about companies: The top three companies that received the most complaints from June through August 2016 were credit reporting companies Equifax, Experian, and TransUnion.