Congress has passed – and the Trump administration has signaled that the president will sign – a bill to roll back the Consumer Financial Protection Bureau’s sweeping arbitration rule, which the White House has called “uninformed and ineffective policy.” As we explained in our previous blog post, the rule would have banned many financial service companies from using mandatory arbitration clauses in contracts with consumers, opening the door to class action lawsuits against banks, mortgage lenders and servicers, credit card companies, and others who extend credit.
The rule’s opponents criticized it as being more favorable to class action plaintiffs’ attorneys than consumers. Or as the White House put it:
“Under the rule, consumers would have fewer options for quickly and efficiently resolving financial disputes. Further, the rule would harm our community banks and credit unions by opening the door to frivolous lawsuits by special interest trial lawyers.” Continue Reading