The rule from the CFPB blocks ‘a fine-print trick that banks and predatory lenders use to evade accountability and conceal illegal behavior’
A new rule by a federal watchdog—hailed as having “paramount importance” for protecting consumers from Wall Street predators and curbing corporate abuses—is under direct attack by Republicans just days after being issued.
The rule from the successful and broadly-supported Consumer Financial Protection Bureau (CFPB) bans companies from using mandatory arbitration clauses, which makes consumers give up their right to file or join class-action lawsuits. In other words, it blocks “rip-off clauses” that are “a fine-print trick that banks and predatory lenders use to evade accountability and conceal illegal behavior,” as advocacy group Public Citizen put it, noting that they are also used by many corporations. Continue reading