Published: October 2022

Effort to get forced arbitration clauses out of consumer contracts continues

Consumer Action and more than a hundred other advocacy groups called on the CFPB to use the agency’s authority to limit forced arbitration clauses in consumer financial contracts.

Consumer Action and more than a hundred other advocacy groups signed on to a letter to the Consumer Financial Protection Bureau’s director, Rohit Chopra, urging him to exercise the agency’s authority to limit the use of forced arbitration clauses by banks and financial institutions to strip Americans of their right to see justice after being victimized by banking abuses or fraud. The groups contend that these fine-print terms buried in consumer financial contracts prevent harmed consumers from exercising their rights to seek accountability when scammed, cheated or defrauded by big banks. A 2015 CFPB report concluded that forced arbitration denies justice to consumers. However, the agency’s final rule limiting use of forced arbitration clauses, issued in 2017, was struck down by the Congressional Review Act when then-Vice President Pence made the tie-breaking vote against.

Lead Organization

Consumer Federation of America and National Association of Consumer Advocates

More Information

Click here to read the coalition letter.

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