CFPB talks with CUs, holds hearing on arbitration
Dec. 12, 2013 – CFPB held a roundtable discussion with leaders from the credit union community Wednesday in Dallas, where the bureau will also hold a field hearing today on arbitration in consumer financial services.
The field hearing, slated for 11 a.m. Central time (noon Eastern), is expected to deal with findings of a CFPB study on the use of mandatory arbitration clauses. The hearing will feature comments from CFPB Director Richard Cordray, consumer groups, industry representatives and the public.
The bureau has been conducting a study on the use of pre-dispute arbitration in consumer financial services. It is required by the Dodd-Frank Act to study mandatory arbitration agreements related to consumer financial products and services. The act also authorizes CFPB to prohibit or limit such agreements based on study findings.
NAFCU last year urged the CFPB to take a “reasonably targeted approach” in addressing arbitration agreements, both to prevent overburdening credit unions and eliminate unintended consequences. NAFCU encouraged the bureau to only focus on arbitration issues that clearly require attention. It said that focusing on lightly regulated or unregulated entities would be the most useful approach.