The federal watchdog agency intended to help consumers find more protections from potentially harmful financial practices has largely been helpful in better informing borrowers of their various obligations, but an official whose job it is to provide oversight for the organization itself says more can be done.
If the Consumer Financial Protection Bureau had one overarching problem in its first year of full regulatory power, it was that in many cases its constituents may not have been given enough of an understanding about the various processes it has in place to protect them, according to the first annual report from Wendy Kamenshine, the agency’s ombudsman. Her office began operations some 10 months ago, and in that time received 775 inquiries from consumers, business people, lawyers, the media, lawmakers and government employees. In all, 80 percent of these submissions came from individual borrowers.
[Free Resource: Check your credit score and report card for free with Credit.com]
Of those inquiries, about 40 percent were related to the ways in which the agency deals with consumers’ complaints, the report said. Most were generally related to a lack of understanding they had about the process through which their filings went, and, therefore, the ombudsman’s office recommended that the CFPB can do more to clarify these situations so that borrowers have a more complete understanding of how their complaints are handled. For instance, some consumers said they did not understand the timeframes with which they were dealing once they submitted a complaint, such as how long it would take to review, or issue a judgment, and also that they did not know what to expect from each step.
One of the ways in which the ombudsman recommended greater clarity to the complaint process is by making sure to share more information with the public through various channels, the report said. Further, it needs to do a better job in giving transparency to when exactly the agency can and cannot help consumers with the complaints they might have about bank and nonbank financial institutions.
[Credit.com Tips & Advice: Get email updates from our experts]
The CFPB has wielded full regulatory power over many lenders and other organizations involved in the financial system for more than a year, but is still expanding its purview to make sure that consumers are protected in as many parts of the various financial aspects of their lives as possible.
Image: Consumer Financial Protection Bureau, via Flickr