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OK, it finally passed.
Now, here’s the uppercase question: What next?
A federal rule declared last week by the Consumer Financial Protection Bureau has understandably enthused — even enthralled — scores of millions of consumers across the country and principals with advocacy groups promoting the public’s rights against big financial institutions.
Yet its fate seems anything but assured, notes a recent USA Today article, notwithstanding its current status enabling consumers to “now freely band together to fight back [against] what they consider to be illegal or fraudulent products” pushed by banks, credit card issuers, payday lenders and other financial entities.
What has long been at issue are the so-called “forced arbitration” clauses that have been a historical mainstay in the fine print of many consumer/financial company contracts. Those provisions deny courtroom access to aggrieved customers, steering them instead to private arbitration panels that often seem to favor the defendant companies in contract breach matters.
The new rule from the CFPB now enables plaintiff litigants to join forces in collective class action lawsuits, which spells an outcome that yields “a huge victory for consumers,” says one advocate.
Again, though, any acclaimed victory would seem to be premature, given the existence of many powerful critics of reform and various avenues that are open to them to fight back against any permanent cementing of the rule as law.
As noted in the above-cited media account, many Republican legislators are “industry-friendly” lawmakers who will now do all they can to undermine the rule going forward.
Reportedly, though, their support is not widely echoed in the public sphere, with one recent poll indicating that more than nine of every 10 Americans endorse court access as opposed to an arbitration-only venue for dispute resolution.