CFPB Servicemember Report
In June, the CFPB released its Office of Servicemember Affairs Annual Report, which looked at complaints submitted by servicemembers, veterans and their families in 2021.
The CFPB first began accepting servicemember-related complaints in July 2011 and, since that time, it has received over 250,000. The Report points out that there were over 42,700 complaints from servicemembers filed in 2021, which was a 5% increase over 2020 and a 19% increase over 2019. In other words, it appears servicemember complaints are trending upward. The most common types of complaints (around 60%) had to do with credit reporting and debt collection, and those were largely driven by medical billing problems and the failures of the nationwide consumer reporting agencies (Experian, TransUnion, and Equifax) to respond appropriately to disputes or investigation requests.
Financial institutions obviously have no control over medical billing practices or whether credit reporting agencies respond to disputes appropriately. However, this report is a great reminder that furnishers still have a responsibility to make sure the information they report is accurate. Of those servicemember complaints related to credit reporting, inaccurate reporting was responsible for 51% of the complaints in 2021. Problems with the investigation or correction of an issue accounted for 33% of the servicemember complaints related to credit reporting. Financial institutions should have a general awareness of how reporting errors and/or failures to correct them can cause harm.
While these issues are not unique to servicemembers, they can lead to greater negative consequences for servicemembers when compared to others. This is often due to a servicemember’s unique lifestyle. For example, credit reporting errors can affect security clearances and the ability to get housing and access to transportation. This can be especially problematic since servicemembers relocate often.
It’s also important to point out that while servicemember complaints related to credit reporting and debt collection were the most common, there were other areas of dissatisfaction too. For example, mortgage, credit card, deposit accounts, and vehicle/personal loans accounted for just over 30% of the servicemember complaints received in 2021.
Published
2022/07/13
Amy Kudlacek
Amy brings many years of banking and compliance experience to Banker’s Compliance Consulting. She has worked for both large and small financial institutions and spent time working in every area of a bank. She started out as a teller in college and eventually became a branch manager. Her love, however, was always compliance. Amy began her career with Banker’s Compliance Consulting in 2000. Her knowledge and experiences have allowed her to develop a well-rounded and practical approach to regulatory compliance. Amy is CRCM certified, has a Bachelors Degree in Business Administration and is a graduate of the ABA Compliance School. Amy & her husband have two children at home and stay busy following their activities. They spend a lot of time in the bleachers!