New analysis: CFPB consumer complaints skyrocket during pandemic

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WASHINGTON — As the House considers the next coronavirus funding bill, the Heroes Act, an analysis by U.S. PIRG of recent complaints to the U.S. Consumer Financial Protection Bureau (CFPB) shows an alarming need for Congressional action to protect consumers from the pandemic’s repercussions. In April, more than 33,000 complaints were filed with CFPB, setting a new monthly record since the database went live in 2011.

“Consumers have every right to be angry with lenders, debt collectors and credit bureaus. So many Americans don’t have the money to pay their bills as a result of the crisis, and it’s not their fault,” said U.S. PIRG Senior Director for Federal Consumer Programs Ed Mierzwinski. “A simple step Congress can take immediately to ease those pain points is to stop debt collection and negative credit reporting.”

Key findings in U.S. PIRG’s analysis include:

  • Credit reporting complaints have always historically topped the list, but these types of complaints increased by more than 20,000 in April, double the monthly amount from 2018.

  • Of the complaints that include written explanations (optional narratives) and mention the pandemic, mortgages and credit cards were the most complained about.

The Heroes Act (H.R. 6800), which is expected to be voted on by the House Friday, includes bans on all debt collection and negative credit reporting during the public health emergency. U.S. PIRG is calling on both the House and the Senate to agree to those bans.

In addition to supporting these provisions (Sections 110401 and 110402) of H.R. 6800, U.S. PIRG is calling on the CFPB to enforce consumer laws, instead of repeatedly telling banks and other firms it will give them flexibility to ignore the rules. Meanwhile, despite merely offering consumers money-saving tips and advice, the agency is continuing down a path to repeal payday lending protections and issue a report recommending changes to consumer laws being prepared by a Task “Farce” of lawyers and academics, all of whom have worked on behalf of the financial industry.

“We support the bans on both debt collection and negative credit reporting during the emergency that are in the Heroes Act,” said Mike Litt, U.S. PIRG Consumer Campaign director. “A review of consumer complaints shows that without Congressional action, financial companies won’t treat consumers whose finances have been harmed by the pandemic fairly.”