Complaints are inherently negative, and we find that institutions often think dealing with them is a waste of time. It’s important to point out; however, that complaint management is an integral part of your Compliance Management System (CMS). Sometimes the only way you know if something isn’t working as intended is if someone complains. If you don’t know it’s broke, you can’t fix it. And in the compliance world, not fixing it could lead to a lot bigger problems. A great example of this is UDAAP. UDAAP violations are often very subjective and depend on the eye of the beholder. Your examiners review complaints filed about you to help them know where to focus an exam. You should be doing the same. A recent edition of the Federal Reserve’s Consumer Compliance Outlook states, Failing to capture and review complaint logs for consumer harm can be a lost opportunity to identify and address potential UDAP risk before it escalates into a violation or enforcement action.
Jerod explains more in the video.
2024/12/04
