Consumer Financial Protection Bureau Seeks Input on Mandatory Arbitration Agreements
The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 gives the
Consumer Financial Protection Bureau (CFPB)the power to issue regulations prohibiting or limiting the use of mandatory arbitration agreements (including class action bans) in connection with consumer financial products or services -- including bankaccounts and services, consumer loans, credit cards, debt collection services, mortgages, and vehicle loans -- if it finds that restricting them "is in the public interest and for the protection of consumers." The CFPB is conducting a study about the effects of mandatory arbitration provisions and has just issued a formal Request for Information. The deadline for submission of information to the CFPB is June 23, 2012.
Moreover, the National Association of Consumer Advocates (NACA) is surveying consumer advocates about the practice of forced arbitration. As the Consumer Financial Protection Bureau gears up to do its study on arbitration, NACA hopes to offer data that demonstrates how arbitration impacts consumers and their ability to seek relief or justice from a particular harm.
Advocates who have experience representing clients subject to mandatory arbitration agreements in connection with financial products or services are encouraged to respond to both CFPB’s request and the NACA survey.