Credit companies have been failing to investigate existing problems in MA.
The number of consumer complaints to financial companies, including banks, credit bureaus, debt collectors, rose dramatically in 2020.
A new report from the Massachusetts Public Interest Research Group (MASSPIRG) Education Fund found the number one problem consumers in Massachusetts face is credit companies’ failure to investigate existing problems, such as errors on credit reports.
Deirdre Cummings, consumer program director for MASSPIRG, pointed to the Trump administration’s weakening of consumer protections. For example, in April of last year, they relaxed a rule that previously required credit bureaus to respond to complaints within 30 days.
“Which was a green light for these financial products to really misbehave, and to not treat consumers properly, at a time when consumers needed the most help and the most protection,” Cummings asserted.
Errors which impact someone’s credit score and financial future disproportionately affect Black, Brown and Indigenous consumers.
The report, released for National Consumer Protection Week, recommends the Senate confirm Rohit Chopra, President Joe Biden’s nominee to direct the Consumer Financial Protection Bureau as soon as possible.
The report also calls on Congress and the bureau to take steps to mitigate the financial hardships caused by the pandemic, as well as strengthen rules against predatory payday lending and harassment by debt collectors; rules rolled back under the Trump administration.
Cummings argued overall, the agency needs to strengthen its enforcement of regulations.
“We have these big three credit bureaus gathering information about consumers, and a lot of that information is incorrect,” Cummings contended. “And then that information is harming consumers with higher costs, denial of credit, denial of housing, denial of jobs.”
Cummings added if consumers were the customers that paid the credit bureaus, they would have to improve their services and take pains to address complaints.
But she pointed out the customers are the banks, lenders and landlords, and she thinks a restructuring of the system is in order.