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Last year, I wrote about the difference between supervision and enforcement by the CFPB here, and I’ve already written once this year about the reemergence of the CFPB here. I want to focus for a few minutes on how to respond to a “typical” CFPB complaint.

A typical, that is, non-life-threatening complaint, may come to you if you have registered your company within the CFPB Portal. Once your company name is matched to a consumer’s complaint, you will be notified by the CFPB of the complaint and offered an opportunity to respond.  

There are eight pro-forma responses identified and described by the CFPB below:

1. In progress: “Your interim responsive explanation to consumer and the CFPB, indicating that the complaint could not be closed within 15 calendar days and that your final responsive explanation to consumer will be provided through this portal at a later date.”
2. Closed with explanation: “Your final responsive explanation to the consumer, indicating that you provided an explanation tailored to the individual consumer’s complaint.”
3. Closed with monetary relief: “Your final responsive explanation to the consumer, indicating that the steps you have taken or will take include objective, measurable, and verifiable monetary relief to the consumer.”
4. Closed with non-monetary relief: “Your final responsive explanation to the consumer, indicating that the steps you have taken or will take include other objective or verifiable relief to the consumer.”
5. Alerted CFPB: “Cannot take action for reasons such as suspected fraud, pending legal matter, business identity theft or because the complaint was submitted by unauthorized third party.”  (This is an administrative response and the response is not published nor seen by the consumer.)
6. Duplicate CFPB complaint reported: “Cannot take action because the complaint is one submitted by or on behalf of the same consumer that does not describe or include any new issue, instance, or information; you must provide the original complaint number with your response.”  (This is an administrative response.)
7. Incorrect company: “Cannot take action because the complaint is not related to your company.”  (This is an administrative response.)
8. Sent to regulator: “Cannot take action because complaint is about a product or issue that needs to be routed to another regulator.”  (This is an administrative response.)

Once the consumer finance company has made the decision to join the CFPB Portal, there really is no going back. If, as and when you receive a complaint, you should evaluate it, and respond through the Portal within 15 days.  

Responding through the Portal does not require that you respond directly to the consumer. However, if the complaint is related to a Fair and Accurate Credit Transactions Act (FACTA) duty, you may want to consider treating such a complaint as a “direct dispute” under that law and responding appropriately to the consumer. See here for my June 3, 2020 article addressing FACTA and direct dispute complaints. Assuming that the information that you reported to your Credit Reporting Agency is accurate, you can and probably should note that fact in your response to the consumer.

Practice pointer:  In this direct dispute scenario, “closed with explanation” is your response. Just be prepared to share the direct dispute letter response with the CFPB if the Bureau comes back looking for more detail.