ETA Call To Action – Let Congress Know Arbitration Works

The Consumer Financial Protection Bureau (CFPB) finalized a rule on July 10, 2017 that would restrict the use of arbitration agreements in contracts for consumer financial products and services. The CFPB estimates the rule will generate over 6,000 class action lawsuits, costing businesses between $2 and $5 billion every 5 years.

CFPB’s anti-arbitration rule will also have significant negative effects on consumers. As illustrated in CFPB’s own study, arbitration is a simpler, a more flexible, a faster and a more confidential process than turning to the courts to settle issues. Class-action lawsuits result in millions of dollars in legal fees but provide little or no benefit to consumers. According to the CFPB’s own numbers, an average class action lawsuit member received just $6.29, while the lawyers leading the case received millions.

By contrast, arbitration results in much higher awards for consumers. The CFPB’s data establishes that consumers won 47 cents on the dollar in arbitration cases where they received a recovery. Moreover, while trials must be scheduled into busy court calendars, arbitration hearings can be scheduled more easily and during non-business hours. For more information from ETA’s policy experts about how the CFPB’s arbitration rule will hurt consumers and businesses alike, click here.

ETA supports the use of arbitration as it provides higher rewards to consumers faster and without the need to hire expensive lawyers.  We have urged Congress to immediately repeal the final rule with the Congressional Review Act (CRA), the only means of Congressional oversight and important check on the unilateral power of the CFPB.

ETA has been active on behalf of its 500+ members by meeting with lawmakers, communicating to the press the value of arbitration and by joining a joint trade coalition letter to Congress that opposes this rule.

The House has passed a bill that will repeal this anti-consumer rule and the Senate is scheduling its companion bill, but we need your help to ensure its swift passage.

Below are three key Senators who need to hear from you. Please contact them and encourage them to support the bill to roll-back the CFPB’s anti-arbitration rule. You can tweet at them by clicking each link below. If you live in one of these Senator’s states, please consider calling or emailing them to politely express your support for the CRA. You can find more information on how to contact your Senator here.

Also, be sure to follow @ElecTranAssoc for important advocacy updates and for more ways to help prevent this rule and its harmful effects.

Senator Susan Collins (R-ME) – 202.224.2523
Click to Tweet: .@SenatorCollins Arbitration delivers speedy resolutions + bigger settlements to consumers. Please vote yes on the CRA #arbitrationisbetter 

Senator Lisa Murkowski (R-AK) – 202.224.6665
Click to Tweet: .@lisamurkowski Arbitration delivers speedy resolutions + bigger settlements to consumers. Please vote yes on the CRA #arbitrationisbetter

Senator John Kennedy (R-LA) – 202.224.4623
Click to Tweet: @SenJohnKennedy ETA encourages Congress to rein in CFPB and prevent its anti-consumer arbitration rule’s harmful effects #uncheckedagency