CFPB Director Cordray explains why the arbitration rule will benefit consumers.
CFPB Issues Rule to Ban Companies From Using Arbitration Clauses to Deny Groups of People Their Day in Court
Financial Companies Can No Longer Block Consumers From Joining Together to Sue Over Wrongdoing
Today, we are announcing a final rule that prevents financial companies from using mandatory arbitration clauses to deny groups of consumers their day in court.
Thank you to Albuquerque for the warm welcome you have given us. This is our 34th field hearing since the Consumer Financial Protection Bureau first opened its doors and started traveling the country to listen to the everyday concerns of American consumers. Each one of these field hearings has been valuable for us. They give us insight and substance to inform our work, and they humanize the challenges posed in the financial marketplace.
Consumer Financial Protection Bureau Proposes Prohibiting Mandatory Arbitration Clauses that Deny Groups of Consumers their Day in Court
Bureau Seeks Comment on Proposal to Ban a Contract Gotcha that Prevents Groups of Consumers from Suing Consumer Financial Companies
Thank you to the American Constitution Society for inviting me to speak today as part of the Access to Justice Series. I have a deep appreciation for the work you are doing to bring together attorneys, both young and old, who share a common commitment to understanding how the law can be put in service […]
I want to welcome you all to this meeting of the Consumer Advisory Board. I am sorry that my attendance at the FDIC’s Board meeting caused me to miss this morning’s session; I heard it was a lively discussion. I especially want to extend a warm welcome to the newest members of the CAB, who […]
Thank you all for joining us in Denver today. We are here to talk about something important that is often buried deeply in the fine print of many contracts for consumer financial products and services, such as credit cards and bank accounts. It is called an arbitration clause, or more precisely, a mandatory pre-dispute arbitration […]
CFPB Considers Proposal to Ban Arbitration Clauses that Allow Companies to Avoid Accountability to Their Customers
Proposal Would End the Free Pass Companies Use Against Group Lawsuits WASHINGTON, D.C. — Today the Consumer Financial Protection Bureau (CFPB) announced it is considering proposing rules that would ban consumer financial companies from using “free pass” arbitration clauses to block consumers from suing in groups to obtain relief. Buried in many contracts for consumer […]
WASHINGTON, D.C. — Today, the Consumer Financial Protection Bureau released a study indicating that arbitration agreements restrict consumers’ relief for disputes with financial service providers by limiting class actions. The report found that, in the consumer finance markets studied, very few consumers individually seek relief through arbitration or the federal courts, while millions of consumers […]
Today we are releasing the results of our study and we are providing our arbitration report to Congress as the law requires us to do. As far as we are aware, this is the most comprehensive empirical study of consumer financial arbitration ever conducted. It is not possible in the space of a few minutes to do justice to the depth and richness of the Consumer Bureau’s report. But I want to discuss a few key findings that shed light on some of the major questions that have been much debated by various stakeholders.
Thank you for joining us here today in Dallas. Every month or so we try to hold an event outside of Washington, D.C., with the purpose of learning first-hand about how consumer financial products and services are affecting people around the country. Today, we are here to talk about arbitration, which is a way to resolve disputes outside of the court system. Rather than take the issue before a judge and, perhaps a jury, the two parties turn to a third party, known as an arbitrator, to decide the dispute.
Today, the Consumer Financial Protection Bureau released preliminary research on the use of arbitration clauses in connection with consumer financial products and services. The research indicates that arbitration clauses are commonly used by large banks in credit card and checking account agreements and that roughly 9 out of 10 clauses allow banks to prevent consumers from participating in class actions. The research also shows that while tens of millions of consumers are subject to arbitration clauses in the markets the CFPB studied, on average, consumers filed 300 disputes in these markets each year between 2010 and 2012 with the leading arbitration association.
Today the Consumer Financial Protection Bureau (CFPB) launched a public inquiry into how consumers and financial services companies are affected by arbitration and arbitration clauses.