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ACA Releases New White Paper Countering the Consumer Financial Protection Bureau PDF Print E-mail
Thursday, 05 May 2016
Washington, DC – ACA International has released a new white paper, ACA International’s Response to the CFPB’s Report “Servicemembers 2015: A Year in Review,” which examines the flaws in how the Consumer Financial Protection Bureau collects, analyzes, and publishes consumer complaint data, especially data collected from servicemembers.

On March 22, 2016, the CFPB released the report Servicemembers 2015: A Year in Review, in which it used raw complaint data to argue that, compared to the general population who files complaints, servicemembers’ complaints are nearly twice as likely to be about debt collection. However, ACA’s new white paper finds that the CFPB’s report relies on broad definitions for “complaint” and “servicemember” in its data collection. Furthermore, the CFPB doesn’t provide the public with meaningful context or methodological explanation, resulting in a flawed report that makes misleading claims about the debt collection industry as a whole.

“ACA agrees with the CFPB that illegal debt collection tactics used by bad actors must be stopped, but using unverified data and anecdotes to generalize an entire industry harms legitimate debt collection companies that want to work with servicemembers in a compliant, consumer-friendly way to resolve their financial issues,” said ACA International CEO Pat Morris.

In the white paper, ACA argues that the CFPB should adopt a narrower definition of “complaint” – one that uses allegations of actual misconduct solely - in order to gain a more accurate and reliable understanding of industry behavior.

“The definition of a complaint is so broad that mere dissatisfaction, as opposed to actual misconduct, is categorized as a complaint. As the CFPB represents itself as a resource for consumers, it is expected that consumers will respond not only with complaints, but also by seeking assistance for the resolution of financial issues,” ACA International Director of Research Josh Adams, PhD, wrote in the white paper.

Also, according to the white paper, the CFPB’s original report doesn’t differentiate between complaints received from active military personnel, veterans or their family members – instead including them all under the “servicemember” umbrella. Thus, despite the perception generated by coverage of the CFPB’s report that the underlying data consists of complaints solely by active duty servicemembers, in reality there are an unknown number of servicemember complaints being filed by people who are no longer, or who have never been, in active military service. Adams writes that “further clarification of these figures would allow for a more refined analysis of the CFPB data.”

ACA International’s Response to the CFPB’s Report “Servicemembers 2015: A Year in Review” is the fourth white paper released as part of a larger initiative to collect more original data about the credit and collection industry that quantifies the ways in which debt collectors help consumers and the overall economy.

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