a perspective on cfpb exams and customer experience
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A Perspective on CFPB Exams and Customer Experience. “Begin with the end in mind” ~Stephen Covey “Great service comes from the heart” ~Barbara Glanz. Agenda. CFPB Goals/Outcomes Exam Modules Emphasis on Fair Lending - PowerPoint PPT PresentationTRANSCRIPT
A Perspective on CFPB Exams and Customer
Experience
“Begin with the end in mind” ~Stephen Covey
“Great service comes from the heart”
~Barbara Glanz
Agenda
• CFPB Goals/Outcomes• Exam Modules• Emphasis on Fair Lending• Process• Complaints• Lessons Learned
CFPB Goals/Outcomes• The CFPB’s goals are to:
Prevent financial harm to consumers while promoting good practices that benefit them
Empower consumers to live better financial lives Inform the public, policy makers and the CFPB’s own policy-making with data
driven analysis of consumer finance markets and consumer behavior Advance the CFPB’s performance by maximizing resources and enhancing
input
• The CFPB’s desired outcomes (in support of its goal of preventing financial harm to consumers and promoting beneficial practices) Adoption of regulations Supervise institutions to foster compliance with federal consumer financial
laws Enforce such laws Hold violators “accountable”
• Instead of establishing industry-wide standards through the rulemaking process, the CFPB plans to use it supervisory and enforcement authority to impose such standards
Exam Modules • Fair Lending• Advertising Marketing• Qualification and Originations• Servicing• Collections• Complaints
Emphasis on Fair Lending• Extraordinarily heavy emphasis on Fair Lending
Advertising and Marketing module looks at Equal Credit Opportunity and Regulation B
Qualification and Originations module looks at all credit scoring and automated underwriting for fair lending compliance
Close scrutiny of:Lenders and service providersUnderwriting and documentation practicesRepayment options and payment postingFeesDisclosuresReportingAdequacy of statements
• Heavy disparate impact testing• Track cases separately
Process• Extensive questionnaires• Introductory “Set the Stage” meeting• Central point of contact• Careful review of answers (Legal/Compliance)• Central repository for data
Security Indexing Controls
• Auditors Frequently change Prefer to work remotely, if possible Own their piece, perspective, pace and process Limited sharing Expect customized reporting (variations of the same
request)• Timeframes
Complaints• The Complaints Module reviews the process for receiving,
tracking and responding to customer complaints.• The definition of a complaint varies but in general appears
to include regular servicing requests.• Policies and procedures are interchangeable.• Line of business and corporate standards are expected to
be identical.• Examiners have expectations that 100% of all calls are
recorded and kept indefinitely. This includes Executive Office calls back to customers.
• Standards for oral and written complaints are expected to be indistinguishable.
• Heavy focus on reporting and significant feedback is offered for the reporting content and distribution.
• Review how does a “normal” customer get to an executive or escalate.
Lessons Learned1. The CFPB exam is:
A whole new ball game A significant time and resource investment All about the customer- and personal perceptions of
customer impacts Data, data, data Much more complex and different than any exam or audit New to them (and banks are complex entities) Enforcement oriented with limits to rebuttals
2. Documentation is key3. Logistics are important4. Scope is not always “as advertised”
Lessons Learned…5. “Surprises” are commonplace – may have to “agree
to disagree”6. The exam will last longer than they anticipate and
perhaps you ever dreamed