Consumer complaints to the CFPB are skyrocketing as the coronavirus outbreak continues

Consumer complaints to the CFPB are skyrocketing as the coronavirus outbreak continues

July 18, 2020 Off By administrator

Americans filed a record-breaking number of complaints to the Consumer Financial Protection Bureau in March as the coronavirus pandemic started flooding hospitals and sending unemployment rates soaring.

Every month since, consumer complaint numbers have been breaking record highs set the previous month, according to a Friday report from the consumer advocacy group U.S. PIRG and the Frontier Group, a left-leaning think tank.

The CFPB received 29,494 complaints in March about various sorts of alleged consumer mistreatment — that number climbed to 37,926 by June.

In one complaint last month, a homeowner talked about entering a mortgage forbearance agreement with their loan servicer because of the outbreak. “Now, they are requesting a balloon payment, which I am unable to make. I’ve been in my home for 16 years,” the person wrote in their complaint.

In another complaint last month, the consumer described dealings with an auto lender that was insisting on payment. “This is a horrible company that says they love and honor veterans, however only the ones who have no financial issues. They harass and don’t care about those of us on hard times, and many will soon know,” the borrower wrote.

The Trump administration “doesn’t want to admit how bad the economy is, just like they don’t want to admit how bad the pandemic is,” said one of the report’s authors, Ed Mierzwinski, senior director, federal consumer program at U.S. PIRG.

Rising complaint totals contradict the administration’s public assertions about the economy, Mierzwinski said. “The database is like a canary in the coal mine. The fact is, there should be more being done at the bureau.”

The consumer watchdog agency has been taking the opposite approach, Mierzwinski said. For example, he pointed to the CPFB’s final rule, issued earlier this month, that revoked a payday lender’s requirement to verify a person could pay back a loan.

The new report comes less than a month after the U.S. Supreme Court decided the agency, created during the Obama administration, could continue to operate. The president can remove the director at will, the high court said.

Consumers can complain to the CFPB about alleged errors on credit reports, debt collection practices, student loans or problems with their bank and credit card company. Alleged credit reporting problems have been the largest complaint category since the database launched in 2012.

The trend has strengthened during the pandemic, the U.S. PIRG report noted. Between March and June, consumers sent in 85,185 complaints about credit reporting, credit repair services and other types of personal consumer reports. That’s an 86% increase from the 45,722 complaints filed on credit reporting in the same four-month period last year.

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