Consumer Groups Say Credit Complaints Have Soared Since Rules Were Loosened

Contending that complaints about consumer reporting agencies have soared, a coalition of consumer groups on Thursday called on the Consumer Financial Protection Bureau to rescind guidance giving the agencies an extended period of time to resolve complaints.

“A search of the CFPB complaint database reveals that there has been a dramatic increase in complaints from consumers regarding delays in the processing of their disputes,” the groups, including Americans for Financial Reform and the Consumer Federation of America, said in a letter to CFPB Director Kathy Kraninger.

The reporting agencies are required to resolve consumer complaints within 30 days. However, Kraninger said in April that due to the coronavirus crisis, she would waive that rule as long as the reporting agencies made “good faith efforts” to settle the disputes.

“The Bureau believes that this flexibility will help furnishers and consumer reporting agencies to manage the challenges the current crisis poses,” she said at the time. “It also will enable consumers, as well as lenders, insurers, employers and other consumer report users, to maintain confidence in the consumer reporting system.”

However, complaints about the reporting agencies have drastically increased.

Between April 1 and Sept. 23, consumers have lodged more than 13,000 complaints contending that their disputes have not been addressed within the deadline, if at all, the groups said. By comparison, there were only 2,000 of the same type of complaint filed in the same period last year. That represents a 550% increase, the groups said.

They added that it has been nearly six months since the CFPB issued the new guidance.

“There should no longer be a pressing need for relaxing statutorily mandated deadlines due to ‘“reductions in staff, difficulty intaking disputes, or lack of access to necessary information.,’” the coalition said. “These issues should have been addressed during the last six months.”

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