CFPB Arbitration Rule is Prime Example of Agency Gone Rogue

July 11, 2017

Yesterday, the Consumer Financial Protection Bureau (CFPB) finalized its brazen arbitration rule that effectively prohibits class action waivers in consumer financial services contracts.

ILR President Lisa A. Rickard and David Hirschmann, president and CEO of the U.S. Chamber Center for Capital Markets Competitiveness, said in a statement that “the CFPB’s rulemaking is based on a highly controversial and flawed study that ignored the practical benefits of arbitration, as compared to the court system, for addressing the types of injuries that consumers most often suffer.” The statement was cited widely in outlets including the Wall Street Journal, The Hill, Morning Consult, MarketWatch, and BuzzFeed.

Additionally, ILR’s Senior Vice President of Legal Reform Policy, Matt Webb, spoke with NPR to explain that the CFPB’s actions are “an example of an agency largely going rogue, doing the bidding of the plaintiffs’ trial bar and doing something that’s going to be harmful to consumers as well as the business community.”