Wisconsin Consumers Getting Relief through the Consumer Financial Protection Bureau’s Public Consumer Complaints Database
Madison, WI –Debt collectors trying to collect debt from the wrong person were the top source of complaints to the Consumer Financial Protection Bureau (CFPB), according to a report released today by the WISPIRG Foundation. The report also found that Wisconsin consumers are 40th most likely to file complaints to the CFPB about debt collection, and that debt collection is a top source of complaints.
“The CFPB is helping consumers get relief from shoddy debt collector practices,” said Bruce Speight, WISPIRG Foundation Director. “Many consumers who don’t owe debts are being harassed by lazy debt collectors who don’t verify consumer identities.”
The report, “Debt Collectors, Debt Complaints: The CFPB’s Consumer Complaint Database Gets Real Results for Consumers”, is the final in a series of reports by the WISPIRG Foundation that analyze the complaints in the CFPB’s public Consumer Complaints Database. The CFPB began accepting complaints in July 2011 and now accepts complaints about most financial products and services. Although the CFPB only opened its doors to complaints about debt collection last July, complaints about debt collection have already outpaced those for common products such as credit cards and bank accounts, accounting for the second largest portion of complaints after mortgages between July and January.
Some key findings:
- The CFPB has helped enable more than 2,700 consumers – 22 percent of complainants – to receive relief as a result of their debt collection complaints. The majority of these are non-monetary relief, such as halting harassing phone calls.
- The most common problems were debt collectors trying to collect debt from the wrong person (25 percent) or repeated phone calls (13 percent). State and federal laws protect consumers from harassing phone calls from debt collectors.
- The most complained-about debt collection company in Wisconsin is Portfolio Recovery Associates, Inc. Encore Capital Group received the most complaints nationwide.
Wisconsin ranks 40th in complaints per 100,000 residents.
- About 16 percent of responses received from debt collectors to complaints filed with the CFPB were deemed unsatisfactory by consumers and were subjected to further dispute.
- Companies varied widely in how frequently they offered relief to complainants. Allied Interstate LLC granted relief to over 97 percent of complainants, while several companies never provided relief.
The report comes as the CFPB finishes collecting comments about debt collection in preparation for rulemaking in the industry. The report recommended that the CFPB make the following improvements to debt collection rules, including the following:
- Require debt collectors to stringently verify that they are collecting accurately-owed debts from the correct consumers, before they start;
- Clarify that the debt collection laws give consumers the right to sue to stop unfair practices and to collect multiple penalties for multiple violations;
- Protect service-members by strictly limiting contact with their commanders to verifications of employment and address;
- Protect all consumers by mandating additional disclosures concerning the effect of paying debts on their credit reports, such as a disclosure that “Paying this debt will not remove it from your credit report.”
The report also recommends that the CFPB move to make the database more user-friendly, analyze the data they receive regularly, and use the information and analysis to implement strong consumer protections.
“The CFPB has only been taking debt collection complaints for a short time but is already swamped with them,” concluded Speight. “Consumers need a strong CFPB that reins in reckless debt collectors who ignore the rules.”
This is the final in a series of five reports by the WISPIRG Foundation that analyze the complaints in the CFPB’s public Consumer Complaints Database. Previous reports have analyzed bank account, private student loan, credit reporting, and credit card complaints.
Visit the CFPB’s public Consumer Complaints Database: www.consumerfinance.gov/complaintdatabase/
WISPIRG Foundation works to protect consumers and promote good government. We investigate problems, craft solutions, educate the public, and offer meaningful opportunities for civic participation. www.wispirgfoundation.org.