By SUZANNE DERSHOWITZ
Last week, the Consumer Financial Protection Bureau (CFPB) launched a brand new credit card complaint database, providing the public with important, new information on which banks have generated criticism from consumers. Making these complaints available online will aid the American people in making responsible decisions about their finances and enhance the transparency of the credit card market. The database is a breakthrough for government openness and accountability, and POGO has been advocating for it since the early days of the CFPB, which was created by the Dodd-Frank financial reform of 2010.
Many of us won’t spend our hard-earned money at a restaurant before checking its reviews on Yelp or book a hotel before scouring TripAdvisor, so why would we choose a credit card before reading consumers’ reviews of the bank and the terms? Well, until now, that was not easy to do. In offering online access to credit card complaints it receives, the Bureau is empowering consumers to bank with those companies that act in the best interest of their customers. For the first time, it won’t just be the individual complainant, the bank, and the regulator who know which companies engage in fraudulent collection practices, leave consumers vulnerable to identity theft, or impose excessive late fees. Disclosing this data will help consumers draw their own conclusions about developing trends and avoid “bad actors.”
When meeting with Elizabeth Warren back in April, 2011 to share open government ideas for starting up the new agency, POGO Director of Public Policy Angela Canterbury brought up POGO’s interest in creating a transparent online complaint database. In our Suggestions for How to Make the CFPB a Prototype for a More Open, Effective, and Accountable Government, POGO suggested that the Bureau examine the Consumer Product Safety Commission’s (CPSC’s) complaint database as a starting place.
We applaud the Bureau for launching the database, even in the face of some opposition from industry. When the Bureau solicited public comments on the proposed policy statement, they received seventeen sets of comments in response. According to the final policy statement the CFPB released Tuesday, industry commenters generally opposed the database, saying that it would only confuse consumers and unfairly damage the reputation of credit card issuers. The Bureau decided not to bow down to industry, but to serve the public interest and go ahead with the database.