NCUA Report - March 2012

Office of Consumer Protection Report
TRENDS IN MEMBER COMPLAINTS AND CONSUMER INQUIRIES

In creating the Office of Consumer Protection (OCP), the NCUA Board sought, among other important goals, to centralize the member complaint process. This goal was achieved in 2010 as OCP started and eventually assumed that responsibility from the five regional offices. In so doing, OCP is able to provide consistent service to credit union members in resolving disputes with their federal credit union. Since assuming this nationwide responsibility, OCP has responded to more than 2,100 member complaints involving more than 680 federal credit unions.

In addition to addressing member complaints, OCP responds to questions from credit unions, their members, and consumers involving:

; Consumer protection laws,

; Consumer compliance regulations, and

; Share insurance matters.

As of Jan. 31, 2012, OCP has responded to 12,026 outside inquiries.

For the vast majority of complaints filed, federal credit unions have been in compliance with federal protection laws or regulations. Of the member complaints reviewed by OCP in 2011, less than 1 percent involved a consumer compliance violation. Of the violations identified, approximately one-half involved technical violations of procedures for investigating unauthorized electronic fund transfers outlined in Regulation E (12 CFR Part 205).

When OCP identifies regulatory errors, federal credit unions
do not hesitate to correct the area of non-compliance and to
provide remedies to their members. For example, one federal
credit union refunded more than $52,000 to a member after
a technical error resulted in repeated unauthorized
withdrawals from the member’s account. In another example,
a federal credit union reimbursed a member in excess of
$4,000 due to inaccurate disclosures in violation of the Truth
in Lending Act, Regulation Z.

Member complaints last year often involved home mortgages. Members’ concerns included rejected mortgage modification requests, disapproved short sales, and pending foreclosure actions. These concerns track the overall performance of the economy and the slump in the home mortgage market.

NCUA does not have the authority or is not in the position to provide the relief that members have sought regarding home mortgages. However, NCUA supports and encourages credit unions’ efforts to work with their members in finding common solutions. In fact, just last month, the NCUA Board put out for comment a proposed loan modification rule, applicable to federal credit unions, that will help keep members in their homes as well as provide relief to credit unions.

OCP is on the front lines of responding to member and consumer inquires and complaints. From this unique vantage point, we see firsthand how credit unions continue to meet federal requirements in the face of challenging economic times, fluctuating markets, and unfortunate consumer hardships. We also see how credit unions continue to exemplify the “people helping people” philosophy.