Credit card hotline is latest issue in consumer bureau fight
The latest fight over the Consumer Financial Protection Bureau involves a credit card hotline. The hotline would essentially take calls from concerned consumers, and the agency would compile complaints about credit card companies. However, banks and card issuers want restrictions placed on the information.
Banks and card companies want to avoid crowd-sourced penalties
The latest issue of contention regarding the beleaguered Consumer Financial Protection Bureau is a credit card hotline that would be used to gather complaints about credit card issuers from customers, according to Daily Finance. Customers can call in to report abuse, and that information would be disseminated by the Bureau to the appropriate state regulatory bodies. Basically, the complaint system would be crowdsourcing; the information would come straight from the people. However, the complaints would also go straight to government officials who could potentially fine card issuers without vetting the complaints. Card issuers and banks, according to Bloomberg, are looking to keep the database private, so only the card issuer, the customer who complained and the appropriate regulatory agency can view information about the individual complaint.
Banks want flow of information stemmed
The idea behind making the information private is that it restricts the flow of raw data, which can be unfairly biased against banks. Currently, the complaint line is set to go live on July 21, when the Consumer Financial Protection Bureau is supposed to begin operations. In its current format, anyone could access the complaint data and see everything said about every credit card issuer that it tracks. Though it may seem that banks and card issuers want to keep this information from the public to keep everyone from seeing the dishonest practices they engage in, there is a fair point to consider; some people are apt to complain about fees regardless if whether those fees were fairly levied. A way to get information straight from the public is certainly admirable, but without restraint it can easily be used inappropriately.
Future of consumer bureau clouded
The CFPB will have authority to regulate, to some extent, virtually all manners of consumer finance like credit cards, mortgages, payday loans, debit cards and so on. However, the existence of the organization has caused a fight in Congress to break out. Three different bills were recently introduced to limit the bureau, according to Reuters, two of which concern who is in charge. One bill would keep the CFPB from taking over regulatory activity from other agencies until it has a dedicated director and another would replace the current structure from having a single director to having a five member panel. Congressional Republicans have made it clear they are not in favor of Elizabeth Warren, the adviser to the White House who is assisting in getting the bureau ready for operation. It does not seem likely that it will begin operations in July as scheduled.