The U.S. Senate has voted to repeal a rule banning banks and credit card companies from forcing defrauded consumers into non-trial private arbitration. As reported on Yahoo! Finance, “The Consumer Financial Protection Bureau, which was built out of the financial crisis, created the rule after five years of studying forced arbitration clauses, the fine print inserted by companies to insulate them from lawsuits, instead sending them to arbitration.”
The CFPB’s director, Richard Cordray, was blunt in response. “Tonight’s vote is a giant setback for every consumer in this country. Companies like Wells Fargo and Equifax [are now] free to break the law without fear of legal blowback from their customers.” As the New York Times put it, “Industry lobbying paid off when the Senate overturned a Consumer Financial Protection Bureau rule on Tuesday night.” Senator Elizabeth Warren, Democrat of Massachusetts, called the vote “a giant wet kiss to Wall Street.”
“The Wells Fargo Immunity Act”
“The bill was entirely and exclusively supported by the [finance] industry,” said F. Paul Bland, an attorney at Public Justice, a consumer group. “Every group that represents consumers was strongly against the bill.”
Bland listed special interest groups that opposed the bill: armed service member groups, senior citizen groups, civil rights groups. “Lots of polling said both Republicans and Democrats oppose the bill by heavy margins,” said Bland. “This was the Wells Fargo immunity act. It’s essentially a bailout for those companies.”
Read the full article on Yahoo! Finance.