Sen. Elizabeth Warren (D-Mass.) wants to know where the nation’s biggest banks stand on the Consumer Financial Protection Bureau’s new rule banning companies from stripping consumers of their right to join class action lawsuits.
Warren sent a letter Thursday to the CEOs of the 16 largest financial firms, including Bank of America and Wells Fargo & Co., asking whether they oppose the rule limiting use of language, known as arbitration clauses, in consumer contracts that force consumers to settle disputes privately with an independent third party.
House Republicans passed a resolution late last month to repeal the controversial rule under the Congressional Review Act. Business and bank lobbying groups reportedly claim the rule limits consumer choices and makes it harder to collect from bad actors.
“A number of lobbying groups representing big banks and financial firms have condemned the rule, asserting that it will harm consumers. The U.S. Chamber of Commerce, 10 the American Bankers Association, 11 and the Financial Services Roundtable12 have criticized the rule and lobbied Congress to overturn it,” Warren wrote.continue reading »