Federal Reserve Webinar on Complaint Management

On August 29, 2018, the Federal Reserve hosted a webinar regarding focused on the topic of complaint management titled “Complaints as a Supervisory and Risk Management Tool.”  In this webinar, the Federal Reserve provided an overview of their complaint investigation process and provided an overview of what they look for when investigating complaints.  While this webinar didn’t provide significantly new information, there were a few takeaways from this training, including some guidance on how to manage complaints on social media.

First, the Federal Reserve listed a number of exceptions to the definition of a “complaint” as follows:

  • Orally submitted complaints

  • Complaints with insufficient information or documentation

  • Litigated complaints and

  • Complaints related to Safety and Soundness issues

The presenters provided a number of policy/procedure considerations and advised listeners to be cautious of 1) complaint definitions that are too narrow, 2) overly decentralized complaint intake and management, and 3) policies/practices that facilitate underreporting or discouraging complaints

The presenters also warned bankers to consider their responsiveness and be cautious of 1) issues improperly escalated or referred multiple times, 2) complaints closed without thoroughly understanding customer concerns, and 3) customer promptness expectations based on complaint channel

In addition, the Federal Reserve recommended adopting a strategy used from “Lean Six Sigma” tools, known as the “5 Whys.”  The presenters explained that the idea of the “5 Whys” is to keep asking “why” until the root cause of the complaint (or issue) is uncovered.  This helps bankers to better uncover potential compliance issues when a complaint, on the surface, may not seem to have compliance implications.  One example gave by the presenters talked about using red or green colors on a website and how a complaint about being able to read the website could have come from a colorblind person.

The presentation provided a number of program integration considerations and warned bankers to be caution of the following:

  • Stopping before you understand root causes

  • Applying complaint categories that do not adequately consider actual or potential violations of law and consumer harm

  • Minimizing customer service issues

  • Ignoring “near misses”

While the main presentation didn’t address social media complaints, the brief question and answer session explained that they had received a large number of questions during the presentation on how to handle complaints received through social media channels, like Facebook.  The presenters explained that the Federal Reserve Board had not provided any official guidance on this, but that the presenters had a few best practices they personally have observed for monitoring social media complaints:

  1. To regularly monitor Facebook and/or the Bank’s social media presence.  Consider automatic alerts.

  2. Acknowledge complaints quickly, but don’t answer them publicly.  For example, consider replying with something like “Thank you, please PM us so we can follow-up”  This approach takes the discussion off of the public platform.

  3. Document and react to Social Media complaints using the same process you would for complaints received through other channels.

The presenters explained that they expected to have a future Consumer Compliance Outlook article on this topic.

The audio and slides from the webinar are available here

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