While taxes and Russia were dominating the headlines, President Trump quietly signed a bill into law that severely weakens America's consumers—all 325 million of us. This law lets financial companies block consumers from going to court when those companies illegally take money away from them. Instead, consumers are forced into arbitration, a process rigged against them with little chance for compensation. Big banks, credit card companies, and payday lenders received a “get-out-of-jail-free” card.
Since the 1990s, more and more companies have inserted forced arbitration clauses into the fine print of contracts. The Dodd-Frank Wall Street Reform and Consumer Protection Act, enacted in 2010, authorized the independent Consumer Financial Protection Bureau (CFPB) to investigate forced arbitration and to take action in the public interest. Based on its multi-year study, the CFPB issued a rule in July of this year to curtail forced arbitration clauses. The CFPB approach was quite modest. The rule ensures consumers can join together in a group lawsuit, but still permits companies to require consumers acting as an individual to take disputes to arbitration.
Read Full Article »