NARCA Submits Response to CFPB Consumer Narrative Proposal

The National Association of Retail Collection Attorneys (NARCA) has provided a response to the Consumer Financial Protection Bureau (CFPB) proposal to make consumer narratives public. The response joins with numerous other organizations in making with a series of recommendations for improving the proposal. The full response can be found here.

The CFPB published a proposed policy statement describing its plans to disclose data from consumer complaints about financial products and services in 2013. The federal agency then began the process of gathering public comment on the proposal.

“We commend the CFPB for its efforts to provide a transparent and level playing field for both consumers and creditors,” said Joann Needleman, president of NARCA and a member of the CFPB Consumer Advisory Board. “We are in agreement with the agency that providing consumers with both sides of the story will help educate consumers on responsible financial management.”

Highlights of NARCA’s recommendations include:

• The CFPB should go beyond just verifying a relationship between the consumer and a creditor, instead making efforts to confirm the accuracy of a consumer complaint before publishing it. In the last few months the courts have cited the standards for accuracy called for in the Fair Debt Collection Practices Act (FDCPA). NARCA believes those same high standards of accuracy should apply to the CFPB and the database.

• Allow companies to post narratives regardless of whether a narrative has first been posted by a consumer. The current proposal only allows companies to post a narrative if it is in response to a consumer narrative. If a consumer opts to provide only a complaint but no narrative, a company is prevented from responding, meaning consumers reviewing the complaint will only be getting one side of the story.

• Consumers should be allowed to amend their narrative at any time in the process. The current proposal provides that consumers may withdraw their consent to have their narratives posted at any time. Consumers’ opinions may change as they get a creditor response to their complaint or inquiry. Allowing a consumer to amend their original inquiry or comment would further the stated CFPB goal of providing the full story.

• The database should allow consumers the ability to post complimentary narratives. The current proposal provides no mechanism for consumers to post narrative compliments about their interaction with a creditor. The CFPB should add this functionality to its database since positive comments are just as helpful in consumer decision-making as negative comments.

“We believe these recommendations will support the CFPB’s goal of protecting consumers by helping to educate them on financial best practices and we look forward to continuing our productive relationship with the CFPB,” said Needleman.

NARCA is a not-for-profit trade association comprised of more than 600 law firms and in-house counsel engaged in the practice of debt collection law. Attorneys employed by NARCA member law firms are committed to the fair and ethical treatment of all participants in the debt collection process. They are required to practice law in a manner consistent with their responsibilities as officers of the court and must adhere to applicable state and federal laws, rules of civil procedure, state bar association licensing and certification requirements and their respective rules of professional conduct.