The Consumer Financial Protection Bureau yesterday released guidance reminding financial institutions that they are not allowed to charge consumers for “basic information” about their accounts. Some banks, for example, are charging consumers for information that is used to manage their finances or fix problems with their bank accounts.
A copy of the advisory opinion is available by clicking here.
While the advisory opinion is specifically aimed at banks and credit unions with more than $10 billion in assets, it doesn’t take much of a leap of faith to see how smaller institutions could fall into disfavor with the CFPB for engaging in similar behaviors. Larger institutions, for now, appear to be the only ones moving away from what the CFPB calls a “traditional” banking relationship with consumers and are making this type of individualized service available only to high net-worth individuals. For the rest of its customers, banks are relying on “highly standardized processes rather than high-quality human interactions or digital channels that actually facilitate self-help,” according to the CFPB.
Section 1034(c) of the Wall Street Reform and Consumer Protection Act requires large financial institutions to comply with consumer requests for information concerning their accounts in a timely manner.
Some of the fees highlighted by the CFPB as potentially being problematic were:
- Responding to consumer inquiries regarding their deposit account balances
- Responding to consumer inquiries seeking the amount necessary to pay a loan balance
- Responding to a request for a specific type of supporting document, such as a check image or an original account agreement;
- Spending time on consumer inquiries seeking information and supporting documents regarding an account.
“While small relationship banks pride themselves on customer service, many large banks erect obstacle courses and impose junk fees to answer basic questions,” said CFPB Director Rohit Chopra, in a statement
