The Consumer Financial Protection Bureau announced with some fanfare two weeks ago that it is going to publish consumer complaints on its website. So, let’s see…
A disgruntled consumer, who decides to get back at his lender, files an unverified, unsubstantiated and unproven complaint. The CFPB, without verification, substantiation or proof, then posts the complaint on its website – first stripping away information identifying the consumer, but not the lender. What can be wrong with that?
Well, for starters, if the lender is a bank then disparaging the same may be a crime under state law and federal law – or at least it used to be. Even if it is not illegal (i.e., disparagement as a crime) it is hardly fair to the lender not to be given an opportunity to investigate and if appropriate, protest the nature of the complaint, before the same is made public.
But say consumer advocates, surely disgruntled consumers would not file a frivolous or irrelevant complaint. Hmmm. Has anyone out there experienced an increase in the volume of frivolous and irrelevant letters alleging account errors?
As we said in a recent post, the CFPB seems to shoot first and ask questions later.
So, the CFPB promotes the situation where the lender’s reputation is damaged with no safeguards or method to appropriately respond.