Alarms Raised as GOP Moves to Let Wall Street 'Rip Off Consumers With Impunity'

September 26, 2020 0 By HearthstoneYarns

Hours before the Senate is set to vote Tuesday on whether to repeal the Consumer Financial Protection Bureau’s (CFPB) broadly popular arbitration rule—which bars companies from using “rip off clauses” to prevent consumers from filing or joining class action lawsuits—Public Citizen and other advocacy groups warned that any move to scrap the CFPB’s measure would permit “predatory banks, payday lenders, credit card companies, and other financial institutions to cheat and defraud their customers.”

“Big banks, the financial industry and their allies in Congress are trying to overturn the arbitration rule because it will deprive them of a means to rip off consumers with impunity.”
Click Here: geelong cats guernsey 2019—Amanda Werner, Public Citizen”The vote on this rule is a litmus test of whose side you’re on: Main Street consumers or big banks,” Amanda Werner, arbitration campaign manager for Public Citizen and Americans for Financial Reform, said in a statement on Tuesday. “Big banks, the financial industry and their allies in Congress are trying to overturn the arbitration rule because it will deprive them of a means to rip off consumers with impunity.”

While it is not clear which way the Senate will vote—Majority Leader Mitch McConnell (R-Ky.) needs 50 senators to support the move, and five Republicans have yet to indicate that they are a “yes”—the Trump White House has not shied away from indicating that it is firmly on the side of Wall Street.

The Treasury Department, headed by ex-Goldman Sachs banker Steve Mnuchin, took what has been described as an “unusual” step on Monday by publicly releasing a report (pdf) slamming the CFPB’s rule, arguing that it is a “giveaway to class-action attorneys.”

But in a piece for The Intercept on Tuesday, David Dayen notes that Treasury’s report relies “heavily on a discredited industry theory.” 

“Claims that CFPB used misleading data and failed to recognize that consumers fare better in arbitration (which isn’t true) come directly from a Koch-funded Mercatus Center study, which the Treasury report cites,” Dayen notes.

The Treasury Department also attempts to argue that the CFPB’s rule opens the door to “frivolous” lawsuits and so-called “blackmail settlements.” But Dayen notes that the “blackmail theory” is a meritless “rhetorical weapon” used by corporations that want “blanket protection from lawsuits of any kind.”

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