Consumer Complaints — Public or Private?

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The following article was distributed to members of the Tennessee Land Title Association.

Consumer! I am still trying to get over using this term. From the title companies I do business with, I am more familiar with the terms customer, or client, which tends to express a more personal relationship. For now, we will agree to go with “consumer.”  In working with your consumers, you must realize their complaints are important and need to be handled delicately; otherwise, a public consumer complaint could be coming your way.

The Consumer Financial Protection Bureau (CFPB) has proposed a new policy that would allow consumers the ability to voice their complaints publicly. Consumers would have the option when submitting a complaint to the CFPB to make their narrative public on the CFPB’s Consumer Complaint Database. It cannot be denied that the CFPB’s focus is on enhancing the consumer experience above all, expecting that companies will implement a strong process to address and resolve consumer complaints.

Do you have a consumer complaint process that meets the CFPB’s expectation? Well, ALTA provides some direction with its seventh “Pillar” as part of its Best Practices Framework, which covers adopting and maintaining procedures for resolving consumer complaints. Adopting and maintaining a consumer complaint resolution process does not particularly have to be expensive, complex or overly time consuming, but does need to be systematic. The three most important areas to emphasize in your policy and procedures for Pillar #7 are:

  1. Training employees on identifying complaints and the process of documentation, which includes the development of a standard Consumer Complaint Form.
  2. Designating a single point of contact to be responsible for logging/tracking and documenting resolution of complaints–this includes development of a Consumer Complaint Log.
  3. Monitoring by management to ensure compliance.

Another reason to adopt ALTA’s Best Practices for Pillar #7 is to gain a competitive advantage by communicating your compliance with the Best Practices Framework to your lending customers. ALTA’s Board of Governors has approved a motion for its members to perform a self-assessment of their adoption of ALTA’s Best Practices no later than September 2014. ALTA’s Best Practices Task Force has released the second “Assessment Readiness Guide” for Pillar #7, in addition to a guide for Pillar #1. These guides are available for members at http://www.alta.org/bestpractices/documents.cfm. The Task Force will roll out guides for the remaining Pillars in the coming weeks.

The Assessment Readiness Guide helps you determine your preparedness to undergo an assessment in accordance with ALTA’s Best Practices Assessment Procedures. Part 1 of the Pillar #7 guide requires you to document business and demographic information, including third-party services documentation. Part 2 is a questionnaire that asks whether your complaint process corresponds to the Best Practices. In addition, there is suggested testing to perform that will help ensure your company is in compliance with ALTA’s Best Practices. Part 3 includes an appendix that addresses the need for documenting your Policies and Procedures, Consumer Complaint Form, and Consumer Complaint Log.

Once the full self-assessment is completed, ALTA is encouraging members to use a Compliance Guide–expected for release in September 2014–to communicate their compliance programs with their lenders.

Having well-developed written policies and procedures about consumer complaint resolution should alleviate some of the worry if or when the CFPB allows public complaint display. The risk of customers posting complaints with the CFPB will be mitigated if your company effectively and timely addresses complaints. With your company’s reputation on the line, it is time to adopt robust consumer complaint resolution policies and procedures to adhere to ALTA’s Best Practices.

If you have questions about ALTA Best Practices services or would like to request a speaker on this topic, contact Debra Gentry at (800) 270-9629.

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