80 FR 37237 - Request for Information Regarding the Consumer Complaint Database: Data Normalization

BUREAU OF CONSUMER FINANCIAL PROTECTION

Federal Register Volume 80, Issue 125 (June 30, 2015)

The Consumer Financial Protection Bureau (``Bureau'') established under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (``Dodd-Frank Act''), maintains the Consumer Complaint Database (``Database'') as a part of its efforts to provide consumers with timely and understandable information to help enable them to make responsible financial decisions and to enhance market efficiency and transparency. The purpose of this request for information is to solicit and collect input from the public on how data are presented in the Database. The Bureau is requesting feedback on best practices for ``normalizing'' the raw complaint data it makes available via the Database so they are easier for the public to use and understand. To normalize data is to transform ``raw'' data so that they may be compared in meaningful ways. This transformation increases the interoperability of ``raw'' data--that is, the extent to which different users can share and make use of the data because they have a common understanding of its meaning. Commenters offered various suggestions on how to approach normalization during the public comment period leading up to the establishment of the Database; the comments' variety highlighted differing and sometimes conflicting perspectives and concerns. In an effort to continue dialogue on easier ways to compare complaint handling performance, the Bureau requests specific suggestions from market participants, consumers, and other stakeholders on data normalization and its proper implementation within the Database.

[Federal Register Volume 80, Number 125 (Tuesday, June 30, 2015)]
[Notices]
[Pages 37237-37239]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-16096]


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BUREAU OF CONSUMER FINANCIAL PROTECTION

[Docket No.: CFPB-2015-0030]


Request for Information Regarding the Consumer Complaint 
Database: Data Normalization

AGENCY: Consumer Financial Protection Bureau.

ACTION: Notice and request for information.

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SUMMARY: The Consumer Financial Protection Bureau (``Bureau'') 
established under the Dodd-Frank Wall Street Reform and Consumer 
Protection Act of 2010 (``Dodd-Frank Act''), maintains the Consumer 
Complaint Database (``Database'') as a part of its efforts to provide 
consumers with timely and understandable information to help enable 
them to make responsible financial decisions and to enhance market 
efficiency and transparency.
    The purpose of this request for information is to solicit and 
collect input from the public on how data are presented in the 
Database.
    The Bureau is requesting feedback on best practices for 
``normalizing'' the raw complaint data it makes available via the 
Database so they are easier for the public to use and understand. To 
normalize data is to transform ``raw'' data so that they may be 
compared in meaningful ways. This transformation increases the 
interoperability of ``raw'' data--that is, the extent to which 
different users can share and make use of the data because they have a 
common understanding of its meaning. Commenters offered various 
suggestions on how to approach normalization during the public comment 
period leading up to the establishment of the Database; the comments' 
variety highlighted differing and sometimes conflicting perspectives 
and concerns. In an effort to continue dialogue on easier ways to 
compare complaint handling performance, the Bureau requests specific 
suggestions from market participants, consumers, and other stakeholders 
on data normalization and its proper implementation within the 
Database.

DATES: Written comments are encouraged and must be received on or 
before August 31, 2015 to be assured of consideration.

ADDRESSES: You may submit responsive information and other comments, 
identified by Docket No. CFPB-2015-0030, by any of the following 
methods:
     Electronic: http://www.regulations.gov. Follow the 
instructions for submitting comments.
     Mail: Monica Jackson, Office of the Executive Secretary, 
Consumer Financial Protection Bureau, 1700 G Street NW., Washington, DC 
20006.
     Hand Delivery/Courier: Monica Jackson, Office of the 
Executive Secretary, Consumer Financial Protection Bureau, 1275 First 
Street NE., Washington, DC 20002.
    Instructions: The Bureau encourages the early submission of 
comments. All submissions must include the document title and docket 
number. Because paper mail in the Washington, DC area and at the Bureau 
is subject to delay, commenters are encouraged to submit comments 
electronically. Please note the number associated with any question to 
which you are responding at the top of each response (you are not 
required to answer all questions to receive consideration of your 
comments). In general, all comments received will be posted without 
change to http://www.regulations.gov. In addition, comments will be 
available for public inspection and copying at 1275 First Street NE., 
Washington, DC 20002, on official business days between the hours of 10 
a.m. and 5 p.m. Eastern Time. You can make an appointment to inspect 
the documents by telephoning 202-435-7275.
    All submissions, including attachments and other supporting 
materials, will become part of the public record and subject to public 
disclosure. Sensitive personal information, such as account numbers or 
Social Security numbers, should not be included. Submissions will not 
be edited to remove any identifying or contact information.

[[Page 37238]]


FOR FURTHER INFORMATION CONTACT: For submission process questions 
please contact Monica Jackson, Office of Executive Secretary, at 202-
435-7275. For inquires related to the substance of this request, please 
contact Christopher Johnson, Acting Assistant Director of the Office of 
Consumer Response at 202-435-7455 or [email protected].

    Authority: 12 U.S.C. 5511(c).


SUPPLEMENTARY INFORMATION: The Bureau hears directly from the American 
public about their experiences with the nation's consumer financial 
marketplace. An important aspect of the Bureau's mission is the 
handling of individual consumer complaints about financial products and 
services. Indeed, ``collecting, investigating, and responding to 
consumer complaints,'' is one of six statutory ``primary functions'' of 
the Bureau as prescribed in the Dodd-Frank Wall Street Reform and 
Consumer Protection Act of 2010 (``Dodd-Frank Act'').\1\
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    \1\ 12 U.S.C. 5511(c)(2). The Dodd-Frank Act additionally 
instructs the Bureau to create a ``Specific Functional Unit'' whose 
function is ``Collecting and Tracking Complaints.'' 12 U.S.C. 
5493(b)(3).
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    The Bureau considers consumer complaints and gathers information as 
it monitors markets for risks to consumers and, subject to certain 
legal constraints, may publish information of which it is made 
aware.\2\ In June 2012, the Bureau began making individual-level 
complaint data available on its Web site.\3\ Since then, the Database 
has been expanded multiple times to include additional financial 
products and data fields.\4\ Most recently, the Bureau published a 
final policy statement on disclosure of consumer complaint narrative 
data.\5\ The Bureau is committed to the continued improvement of the 
Database in terms of both the fields of data made publicly available as 
well as the usefulness of, and appropriate formats for, that data. 
Consistent with these goals, the Bureau is seeking best practices for 
normalizing relevant data in the Database.
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    \2\ 12 U.S.C. 5511(c) and 5512(c).
    \3\ Disclosure of Certain Credit Card Complaint Data (Final 
policy statement), 77 FR 37558 (June 22, 2012).
    \4\ See, e.g., Disclosure of Consumer Complaint Data (Final 
policy statement), 78 FR 21218 (Apr. 10, 2013).
    \5\ Disclosure of Consumer Complaint Narrative Data (Final 
policy statement), 80 FR 15572 (Mar. 24, 2015). The final policy 
statement on consumer complaint narratives is separate and distinct 
from this request for information.
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    Data Normalization. Throughout the Database's launch and expansion, 
the Bureau has solicited feedback on ways to make raw complaint data 
more meaningful by supplementing that data with a context more useful 
for consumers and other market participants. For example, providing the 
total number of complaints against an issuer of credit cards may offer 
limited opportunities to analyze that company against other credit card 
issuers. However, additional information on the size of the issuer's 
credit card business as compared to others provides another aspect from 
which consumers may make better informed decisions. This process of 
giving context to data is commonly referred to as ``normalization'' in 
statistical applications. (``Normalization'' as discussed here should 
not be confused with the term ``database normalization,'' which refers 
to the technical process of designing an efficient way to store data in 
a computerized database.)
    In its initial proposed policy statement to launch the Database 
with credit card complaint data, the Bureau expressed the benefits of 
normalization for both consumers and other stakeholders.\6\ Several 
commenters responding to the proposal echoed the need for normalized 
values in the credit card complaint data. One commenter noted the need 
to distinguish between consumers complaining about open, as opposed to 
closed, accounts in weighing credit card complaints against an issuer's 
overall credit card business. Other commenters suggested that 
normalized values could be achieved by providing an issuer's complaint 
rate according to their market share. Notably, the comments provided 
did not coalesce around a single appropriate normalization metric.
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    \6\ Disclosure of Certain Credit Card Complaint Data (Notice of 
proposed policy statement), 76 FR 76628, 76631 (Dec. 8, 2011).
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    In the same issue of the Federal Register containing the finalized 
credit card disclosure policy statement, the Bureau proposed expanding 
the Database beyond credit card complaint information.\7\ Commenters 
provided additional feedback on normalization in response to the 
proposal.\8\ For example, one trade association representing debt 
collectors suggested the Database include the number of accounts held 
by the company, annual number of contacts made by the company, and the 
annual number of complaints made against the company. Additional 
commenters suggested that the database include information on numbers 
of transactions or accounts, information on closed or unopened 
accounts, and portfolio size. One trade association recommended that 
the normalizing metric be provided by independently verified data.
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    \7\ Disclosure of Consumer Complaint Data (Notice of proposed 
policy statement), 77 FR 37616 (June 22, 2012).
    \8\ Disclosure of Consumer Complaint Data (Final policy 
statement), 78 FR 21218, 21222 (Apr. 10, 2013).
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    In the proposed policy statement regarding the expansion of the 
Database to include consumer narratives, the Bureau again received 
feedback on the issue of normalization. Several companies, trade 
associations, and consumer groups submitted comments that reiterated 
the request for normalization to provide context to the available data. 
Both large and small institutions expressed concern that failure to 
indicate the relative share of complaints would cause confusion for 
consumers, resulting in unfair reputational harm. Commenters requested 
that complaint data and narratives be normalized to reflect institution 
size as measured by volume of customers or total transactions.
    The Bureau now requests specific suggestions for metrics it might 
implement in the Database to assist in normalizing the complaint data. 
Specifically, the Bureau is interested in responses to the general 
questions below:
    1. Is data normalization worthwhile, if so, how should the Bureau 
normalize data?
    2. How should ``categories'' be defined for the purpose of 
normalizing consumer complaint data? Should we normalize by product, 
sub-product, issue, geography, or another category?
    3. How should a ``market'' be defined for the purpose of 
normalizing consumer complaint data? How can ``market share'' be 
adequately evaluated and framed? What metrics should be used to 
evaluate market share? What factors within those metrics are we trying 
to normalize for, e.g., industry size, company market share, and 
population?
    4. Would normalized data allow for meaningful company-to-company 
comparisons within a market?
    5. Do the answers to the questions above differ based on the 
various categories reflected in the Database?
    6. What metrics would be required to normalize the data, e.g., 
number of accounts per financial institution, population by ZIP code or 
other geographic area, etc.? Can these metrics be reliably obtained? 
Should the Bureau seek to independently verify any normalizing metric 
that it might use? How could it most reliably and effectively do so?
    The Bureau does not anticipate publishing a proposed policy 
statement

[[Page 37239]]

on the subject of this request. The Bureau is committed to the 
continued improvement of the Database to help consumers make informed 
decisions about the financial marketplace. Consistent with these goals, 
the Bureau is seeking best practices for normalizing relevant data in 
the Database.

    Dated: June 24, 2015.
Richard Cordray,
Director, Bureau of Consumer Financial Protection.
[FR Doc. 2015-16096 Filed 6-29-15; 8:45 am]
 BILLING CODE 4810-25-P