10 Steps to Close the Loop on Consumer Complaints

Rozanne Andersen

Announced last week and beginning mid-July, the CFPB will start to accept and resolve consumer complaints against the ARM industry. How should you respond?

Gone are the days when the Federal Trade Commission simply tallied consumer complaints. On May 23, 2013, the Consumer Financial Protection Bureau (CFPB) announced the expansion of its consumer complaint database and complaint resolution programs. Collection agencies, asset buyers, and collection law firms, regardless of size, will be required to respond to CFPB-generated complaints in both a timely and meaningful manner.

Establishing a closed-loop consumer complaint resolution program is now, more than ever, a must-have for true compliance. Here are 10 essential steps to setting one up that works:

Define “Complaint” – Truth be told, there’s no uniform way of defining what makes a complaint a complaint. So take immediate steps to define the term for your organization. Broad, inclusive definitions will likely lead to higher complaint volumes, but provide a clearer picture of how effectively staff is interacting with customers. Narrow, exclusive definitions will reduce the number of complaints you track within your organization, but may risk encouraging consumers to find alternative ways to log them.

Review complaint sources – Complaints can find their way to your operation through many channels: the CFPB, the BBB, state attorneys general, state regulators, consumer attorneys, and directly from consumers, just to name a few. Identify the sources for complaints filed against your organization, identify trends, and take corrective action.

Lose the spreadsheet – Tracking consumer complaints on a spreadsheet is like maintaining account inventory on 3×5 note cards. Sophisticated technology exists to input complaints, tie them to the accounts, log the date received, schedule the date by which a response is required, record the resolution provided, and track the remedial action taken following resolution.

Become a Complaint Magnet – Don’t wait for consumers to find alternative means to file complaints with the CFPB or third parties: You should be their first source for help. Otherwise, you run the risk of drawing unnecessary regulatory attention to your operation. Set up a complaint desk, an ombudsman program, or a portal for consumers to file complaints on your web site. Publish an 800 number for them to call. In all cases, train your collectors to recognize a disgruntled customer who should be elevated to a trained consumer services manager within your organization. Consumers raise objections to your collectors all day long, every day. Only those discerning enough can identify the difference between an objection to payment, and a complaint about your organization’s practices, communications, policies, or procedures.

Reduce your expectations to writing – Your collectors can’t read minds and neither can consumers. Reduce the process by which your organization handles, processes, resolves, remediates, and takes corrective action regarding consumer complaints to a written policy. Widely distribute that policy within your operation and conduct regular training sessions about your expectations and your complaint handling processes. Document the date and time of the training and the names of the attendees.

Don’t forget your Board of Directors – Nothing is more alarming to a Board of Directors than to find their company is subject to fines, penalties, or enforcement action brought by federal or state officials. Take steps to keep your Board of Directors informed of the preventive action you are taking to manage consumer complaints and keep them apprised of your progress.

Follow resolution with remedial action – Resolving a complaint to the consumer’s satisfaction is only half the battle: the other is taking internal action to correct a process, or otherwise prevent the issue from surfacing again. Using technology designed specifically to handle complaints, you can respond to the complaining party, record the resolution, and process any payments to them automatically. Beyond the efficiency benefits, using those solutions can also help establish accountability for why the complaint occurred, modify policies, communicate those updates to your staff, and trigger disciplinary action or monetary penalties as appropriate.

Take analysis to the next level – Spreadsheets can make calculations, but fall short of driving analysis regarding consumer complaints, complaint sources, remedial action taken, and that action’s associated costs. Support those responsible for the culture of compliance to which your operation adheres by giving them the information they need to make good decisions.

Be proactive: download the CFPB’s complaints – Technology exists to help your operation interact seamlessly with the CFPB’s complaint database. Don’t wait for them to contact you: consumer complaints filed with the CFPB can be delivered to you immediately with the right tools.

Identify your CFPB contact – It’s essential that the CFPB is able to direct complaints received to the proper contact at your company. Identify the person within your organization who will receive and be held accountable for complaints received from them.

Consumer complaint resolution isn’t new to the debt collection industry, but responding to a federal regulator regarding a consumer-generated complaint certainly is. So if there ever was one, now is a great time for all members of the ARM industry to review their organization’s consumer complaint tracking, resolution and remediation procedures.

Respond to new federal oversight with a closed loop consumer complaint resolution system from Ontario Systems. Process, track, respond to, and resolve consumer complaints regardless of source with new technology developed by Chief Compliance Officer, Rozanne Andersen, in collaboration with clients, regardless of the needs or size of your organization. For a personalized demo, and a full discussion of compliance requirements in this new legal environment, get in touch with Chris Cochran today! Chris.cochran@ontariosystems.com

The information contained in this publication is provided solely for educational purposes and does not constitute and should not be relied upon as legal advice. You are responsible for your own compliance with the law and you need to understand that the tools and product offerings described herein do not guarantee compliance. Accordingly, you need to consult with your own independent legal counsel regarding the topics addressed herein and how best you can comply with the law.