Senate votes to kill new rule allowing class-action lawsuits against banks after Pence casts d

[Zippyjuan]

Pence cast deciding vote after the Senate vote was tied.

The rule would not have banned arbitration but allowed class action lawsuits as another option for consumers to persue.

http://www.latimes.com/business/la-f...024-story.html

he Senate voted Tuesday night to kill a controversial rule that would have allowed Americans to file class-action suits against banks instead of being forced in many cases into private arbitration.

The move by the Senate followed a similar action by the House in July to rescind the rule. President Trump is expected to sign the repeal legislation, providing a major victory for the financial industry.

Vice President Mike Pence cast the deciding vote after the Senate tied 50-50. All but two Republicans — John Kennedy of Louisiana and Lindsey Graham of South Carolina — voted to repeal the rule. No Democrats or independents supported the move.

The White House said Trump “applauds” Congress for voting to repeal the rule, which would have given consumers “fewer options for quickly and efficiently resolving financial disputes.”

The rule was unveiled in July by the Consumer Financial Protection Bureau and praised by Democrats and consumer advocates as giving average people more power to fight industry abuses, such as Wells Fargo & Co.’s creation of millions of unauthorized accounts.

But banking lobbyists argued that the rule would unleash a flood of class-action lawsuits, and that the cost of fighting those suits would be passed on to consumers. Republicans quickly moved to repeal the regulation.

“The entire purpose of this rule is to promote class-action litigation and stop arbitration resolution when there is a dispute,” said Sen. Mike Crapo (R-Idaho).

The U.S. Chamber of Commerce praised the repeal vote, saying the rule “would have benefited the class-action trial bar at the expense of American consumers and businesses alike.”

Set to take effect in March, the rule would not have banned clauses in checking account, credit card and other banking agreements that say disputes between companies and customers must be dealt with privately or in small claims court.

Instead, there would have been a ban on provisions that block consumers from banding together to bring class-action cases. The CFPB argued that such cases help hold banks accountable.

The determinations of an arbitrator are binding and consumer advocates say most decisions favor the company. The private proceedings also allow banks to deal with individual problems quietly rather than address widespread abuses.

Bureau Director Richard Cordray called the Senate vote “a giant setback for every consumer in this country” and urged Trump to veto the repeal legislation.

“It robs consumers of their most effective legal tool against corporate wrongdoing,” Cordray said. “As a result, companies like Wells Fargo and Equifax remain free to break the law without fear of legal blowback from their customers.”

[specsaregood]

The rule would not have banned arbitration but allowed class action lawsuits as another option for consumers to persue.

Not quite, it would have made barred banks from having clauses in contracts with customers that prohibited class action lawsuits. The difference is important. It reads to me that class action lawsuits are still allowed as long as the customer has not already agreed NOT to participate in one.

[Zippyjuan]

Not quite, it would have made barred banks from having clauses in contracts with customers that prohibited class action lawsuits. The difference is important. It reads to me that class action lawsuits are still allowed as long as the customer has not already agreed NOT to participate in one.

Except most all of your bank agreements (and other agreements with non-banking companies) specify that any disputes will be solved by arbitration- and the company gets to pick the mediator. Look for even more such clauses in the future. Credit Unions generally don't use them though.

http://www.sunjournal.com/big-banks-...ation-clauses/

The fine print of many consumer contracts takes away our access to the courts. Instead, these contracts provide that you must bring disputes before a private arbitrator approved and often paid by the company, and you can’t team up with others to take on a financial behemoth that has injured thousands or millions.

After Equifax revealed the massive data breach impacting more than 145 million Americans — including 536,436 in Maine (40 percent of the state) — Equifax offered free credit monitoring. But buried in the fine print was a forced arbitration clause banning people from filing a lawsuit or joining a class action “relating in any way to Your relationship with Equifax.” Wells Fargo created 3.5 million fake accounts (217 in Maine) and then used arbitration clauses in real accounts to kick cases out of court and allow the fraud to continue.

Lobbyists also falsely claim that people recover $5,389 on average in arbitration. But the $5,389 number is based on only 16 people per year who win in arbitration; most lose. Including winners and losers, the average consumer who goes to arbitration has to pay $7,725. And while only 16 people per year win cash in arbitration, 32 million Americans are eligible for relief in class actions.

[specsaregood]

Except most all of your bank agreements (and other agreements with non-banking companies) specify that any disputes will be solved by arbitration- and the company gets to pick the mediator. Look for even more such clauses in the future. Credit Unions generally don't use them though.

http://www.sunjournal.com/big-banks-...ation-clauses/

I don't see any except in what you posted compared to what I said. And you even listed an option for consumers that don't want to agree to such a clause. so whats the problem? Should the federal government be deciding what can go in private contracts?

[Zippyjuan]

I don't see any except in what you posted compared to what I said. And you even listed an option for consumers that don't want to agree to such a clause. so whats the problem? Should the federal government be deciding what can go in private contracts?

Should citizens be deprived of the right to sue if they perceive that they have been wronged?

[specsaregood]

Should citizens be deprived of the right to sue if they perceive that they have been wronged?

I would say that they have the right to GIVE UP their such a right voluntarily -- which is what this is about, they are being deprived of nothing. Also it wouldn't even do that as this only applied to class-action lawsuits, not private lawsuits.

Did you even read the bit you posted? Everything I said is right there in the OP.

[Zippyjuan]

I would say that they have the right to GIVE UP their such a right voluntarily -- which is what this is about, they are being deprived of nothing. Also it wouldn't even do that as this only applied to class-action lawsuits, not private lawsuits.

Did you even read the bit you posted? Everything I said is right there in the OP.

You assume they were aware of the clause when they signed up for their accounts. Did they knowingly make a decision? Was it voluntary? Do you read though all those long agreements when you sign up for something? The agreements are also changed after you sign up for an account or service.

[specsaregood]

You assume they were aware of the clause when they signed up for their accounts. Did they knowingly make a decision? Was it voluntary? Do you read though all those long agreements when you sign up for something?

Yes, I read them. So basically you want to excuse them for making agreements they don't bother to read? We'll have to agree to disagree then. If that is your position, then no contract ever should be enforced. Because, they can just use the, "well I didn't read it" excuse and get out of their end.

[devil21]

Yes, I read them. So basically you want to excuse them for making agreements they don't bother to read? We'll have to agree to disagree then. If that is your position, then no contract ever should be enforced. Because, they can just use the, "well I didn't read it" excuse and get out of their end.

I don't know if it's that simple. Similarly, liability waivers aren't easy to enforce even if it's part of a contract. Consumers should be able to pursue damages in court if the bank violates state or federal regulations. You better believe that same bank will use the courts to obtain judgments and enforce collections so seems to me that prohibiting the consumer from using those same courts to litigate their damages violates Equal Protection.

[timosman]

Waters: Trump Has Stripped Millions of Their Right to Join Together and Have Their Day in Court

https://democrats-financialservices....umentID=400904

Washington, DC, November 2, 2017

In response to President Trump’s signing of a Joint Resolution to repeal the Consumer Financial Protection Bureau’s rule to protect consumers by restricting forced arbitration clauses, Congresswoman Maxine Waters (D-CA), Ranking Member of the Committee on Financial Services, issued the following statement:

“By signing the repeal of the Consumer Financial Protection Bureau’s rule banning forced arbitration, President Trump stripped millions of Americans of their right to band together and take financial institutions to court for misconduct. Forced arbitration clauses force consumers who have been harmed by financial institutions into closed door arbitrations that they are very unlikely to win and prevent them from joining together with other harmed consumers to go to court. Studies show that consumers win only nine percent of the time in arbitration.

“By signing into law this Republican-passed legislation, the President has shown that he stands with the interests of bad actors on Wall Street, like Equifax and Wells Fargo, and not with the American consumers who have been cheated by them. With this shameful action, Donald Trump has once again betrayed hardworking Americans.”

In July, Ranking Member Waters released a Democratic staff report documenting the successes of the Consumer Financial Protection Bureau and the importance of the Consumer Bureau's rule on forced arbitration.

Ranking Member Waters led opposition to the Joint Resolution in the House.

[LibForestPaul]

Big Law vs Big Investment, Big Investment won, boo hoo.

[timosman]

Big Law vs Big Investment, Big Investment won, boo hoo.

Maxine would like you to believe she represents you and was trying to protect your right to pocket $5.33 when Big Law wins a case for a landmass of sheep against Big Investment and then pockets hundreds of million$. +rep