7/10/2017

BANKING/CONSUMER PROTECTION: “An Obama-appointed regulator on Monday [7-10-17] barred financial-services companies from requiring customers to use arbitration to resolve disputes, setting off a showdown with the Trump administration and congressional Republicans.
Consumer Financial Protection Bureau Director Richard Cordray completed a rule proposed in May 2016 over the opposition of Trump administration officials and Republicans lawmakers. The move prompted a rebuke from acting Comptroller of the Currency Keith Noreika, the only Trump administration official so far in place at a federal banking regulator, and a threat by a top House Republican to hold Mr. Cordray in contempt of Congress.
Some Republicans are considering the use of a legislative tool known as the Congressional Review Act to quickly undo the arbitration rule. Republicans have used the tool to revoke more than a dozen Obama-era regulations.
The CFPB’s rule prevents companies from including in consumer contracts any arbitration clause that blocks class-action lawsuits, though it doesn’t ban arbitration entirely. Such clauses are commonly used for a range of financial products, including credit cards, certain auto loans, payday loans and private student loans. Financial companies will have about eight months to comply with the rule.”

-Rachel Witkowski, Andrew Ackerman, and Brent Kendall, “Consumer Agency’s Arbitration Move Sets Off GOP Showdown,” The Wall Street Journal online, July 10, 2017 06:24pm