Executive Director, CoPIRG
Executive Director, CoPIRG
Colorado ranked 9th for most complaints per capita by older Americans according to an analysis of the Consumer Financial Protection Bureau’s (CFPB) consumer complaint database. Mortgages were the leading source of 72,000 national complaints to the CFPB and the leading source of the over 1,300 complaints from older Coloradans. Complaints about credit reports, debt collection, and credit cards rounded out the top four according to the analysis from the CoPIRG Foundation and the Frontier Group.
The two groups highlighted that legislation passed by the House and awaiting Senate action would cripple the Consumer Bureau and place older consumers at greater risk of harm from financial scammers.
“Over a thousand older Coloradans have flagged predatory behaviors and products in the financial marketplace to our country’s consumer watchdog – the Consumer Financial Protection Bureau,” said Danny Katz, Director of the Colorado consumer group CoPIRG Foundation. “Not only do these complaints provide ways for Coloradans who were ripped-off or wrongly harassed to get relief, but it is helping the Consumer Bureau stand up for consumers, especially older consumers, against any predatory financial company in our country. The last thing Congress should do is weaken the Consumer Bureau or undermine its effort to protect consumers.”
“Older consumers can make tempting targets for predatory behavior in the financial marketplace” said Mona Moffatt from the Colorado Senior Lobby. “Scammers may look to take advantage of their savings, home equity, or guaranteed income. Older consumers facing a savings shortfall may be harmed by low-balance or overdraft fees at banks, or be tempted to take on credit or use products such as reverse mortgages, whose risks may not be fully understood. It’s critical the Consumer Bureau be allowed to do its job, especially to keep focusing on helping older Americans.”
Among the key findings of the CoPIRG Foundation and Frontier Group report “Older Consumers in the Financial Marketplace: An Analysis of Complaints, and Results, From the CFPB” are the following:
- Colorado ranked 9th for most complaints per capita by older Americans despite only ranking 24th for total population over the age of 65. The top ten for per capita consumer complaints by Americans over the age of 62 were (in order) – Washington D.C, Nevada, Delaware, Maryland, Georgia, Florida, California, New Jersey, Colorado and Arizona.
- Mortgages account for 31 percent of complaints by older consumers nationally and 37 percent of older Coloradans. Other leading complaint categories for older Coloradans were credit reporting (18 percent), debt collection (12 percent) and credit cards (17 percent).
- Nationally, 80 percent of mortgage complaints concerned existing mortgages, but 5 percent of complaints were about reverse mortgages, loans solely available to older consumers that allow them to use their home equity as security. The risks of such products are not always fully understood by consumers.
The Consumer Bureau has taken numerous enforcement actions against companies ranking high in complaints in the study:
- Mortgage complaint enforcement actions have been filed against at least 3 mortgage companies ranked in the top ten of the report’s finding, including Ocwen Loan Servicing, Nationstar Mortgage, and a company (Green Tree) that later merged with Ditech, which ranked sixth.
- The Consumer Bureau has taken actions against all 3 of the major consumer reporting agencies (credit bureaus) ranked by complaint volume (Equifax, Experian and TransUnion).
- The Consumer Bureau has taken actions against the top 2 debt collection companies ranked by complaint volume, Encore Capital Group and Portfolio Recovery Associates.
- The CFPB provides valuable resources through its Office for Older Americans, which works full time to help older consumers avoid bad deals, and find restitution when they are wronged.
One bill in Congress that would impact the CFPB’s mission to protect consumers is HR 10. Labeled the “Wrong Choice Act” by consumer advocates, it rolls back the powers, funding and independence of the CFPB and it also weakens its pioneering Office for Older Americans. The bill also eliminates many other financial system reforms of the 2010 Dodd-Frank Act enacted after the second-worst financial crisis in the nation’s history.
“The Consumer Bureau has already taken numerous major enforcement actions against financial firms targeting older consumers,” said Katz. “Gutting the CFPB makes it easier for financial scammers to move against older consumers, threatening their homes and retirement savings.”
CoPIRG Foundation staff encourage Coloradans to file a complaint with the Consumer Financial Protection Bureau if they have a problem with a financial product or service here.