House Votes to Rollback Arbitration Rule
In a party line vote, the U.S. House voted 231-190 yesterday to overturn an arbitration rule that would make it easier for consumers to join class-action lawsuits, a rule set forth recently by the Consumer Financial Protection Bureau.
The CFPB’s rule, finalized earlier this month, bans financial service providers from using pre-dispute resolution agreements to block class action lawsuits. It also requires companies to submit to the CFPB certain records about claims, counterclaims and awards issued in arbitration.
The repeal vote marked Republican efforts to rein in the CFPB, an independent watchdog agency set up after the 2008 economic crash the GOP says has been granted too much unchecked authority.
According to the Washington Times, “proponents of axing the rule said the CFPB overstepped in issuing a rule that could drown businesses in excessive litigation, and said arbitration — where disputes are settled outside of court — can ultimately be more beneficial for consumers.” The Senate must now vote to send this rollback to the president’s desk. Read the full article here.