Dec. 12 CFPB field hearing addresses arbitration
Dec. 3, 2013 – The CFPB will hold a field hearing in Dallas Dec. 12 on arbitration, during which the bureau is expected to release the findings of its study on the use of mandatory arbitration clauses, featuring comments from agency Director Richard Cordray, consumer groups, industry representatives and the public.
The field hearing is the first to focus on arbitration clauses, which have been targeted by consumer groups in the past. The bureau is currently conducting a study on the use of pre-dispute arbitration. The Dodd-Frank Act requires the bureau to study mandatory arbitration agreements related to consumer financial products and services and authorizes the bureau 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.