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Bank of America customers win more disputes

In mortgage cases, merit found in higher percentage than with other major banks

Bank of America has found merit in its customers’ mortgage-related complaints at a higher rate than its peers, data released Thursday by a federal regulator shows. The Charlotte bank has awarded some form of relief in 22 percent of such cases filed through the Consumer Financial Protection Bureau, an Observer review found.

More than 15,000 mortgage-related complaints have been lodged against Bank of America since December 2011, nearly double the volume leveled against Wells Fargo, which received the next-most mortgage complaints. In both cases, mortgage problems make up the vast majority of the nearly 33,000 complaints customers have filed against the two banks.

Another 22 percent of Bank of America customers complaining about mortgages disputed the bank’s resolution of their problem.

Wells Fargo granted relief to customers complaining about mortgage issues 9 percent of the time. Another 24 percent of customers disputed the resolution.

JPMorgan Chase gave relief 16 percent of the time, and Citigroup did in 18 percent of cases.

In the majority of the cases, each bank closed complaint files by explaining to the customer what happened and not granting relief.

Neither Bank of America nor Wells Fargo immediately responded to requests for comment.

The Consumer Financial Protection Bureau also tracks complaints about credit cards, private student loans, bank accounts and other loans. The agency, created as part of the Dodd-Frank financial reform law, had previously published a database of the credit card complaints.

The regulatory agency released a complete database of its complaints -- with more than 90,000 entries -- for the first time Thursday.

They break down the complaints by type, response and by ZIP code, but do not release any personal information or give an account of the complaint. The CFPB also does not verify all of the facts in the case.

The complaint databases have been a contentious issue in the banking industry. Banks have recoiled against having complaints published without regard to their merits. They also note that numbers can be misinterpreted because larger banks will necessarily receive a large number of complaints.

The American Bankers Association publicly opposed the plans when the credit card complaints were first published.

"While our industry stands ready to work with the CFPB to resolve customer concerns, the bureau’s plan to release unverified data is disappointing and could mislead consumers," the association said in a June statement. "Publishing allegations is often different than publishing facts."

But in a speech in Iowa on Thursday, CFPB director Richard Corday said the data painted a new picture of the banking landscape, and would allow consumers, financial companies and the bureau itself to make better decisions.

“By sharing these complaints with the public, we are creating greater transparency in consumer financial products and services, which ultimately will lead to a better marketplace for consumers,” he said, according to prepared remarks.

“For financial companies, this data can help them identify their pain points so they can detect and understand problems.”

The complaint data comes at a time when banks are under scrutiny for how they work with delinquent homeowners on their mortgages. A $25 billion settlement last year between state attorneys general, federal agencies and Bank of America, Wells Fargo and three other servicers aimed to force the banks to improve their loan modification and other servicing practices.

Nearly 5,000 of Bank of America’s complaints dealt with loan modifications or foreclosures.

An Observer report earlier this week found that troubles have persisted, even in areas the settlement was designed to fix.

Mortgage monitor Joseph Smith’s office is now relying on Consumer Financial Protection Bureau to identify areas that need to be investigated. Smith, the former N.C. commissioner of banks, is due to report on how banks have complied with servicing standards later this spring.

Dunn: 704-358-5235 Twitter: @andrew_dunn
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