WASHINGTON–The Independent Community Bankers of America (ICBA) is expressing its displeasure over the new CFPB rule banning forced arbitration agreements.
“ICBA is very concerned that the CFPB’s Arbitration Agreements final rule removes arbitration as a meaningful option for community banks to resolve consumer disputes,” said ICBA President and CEO Camden R. Fine. “Arbitration has been a useful and cost-effective tool for both customers and those community banks that use arbitration agreements to settle customer disputes. It isn’t economically feasible under the new rule for community banks to continue to pay the costs associated with arbitration for customers if banks are forced to carry the high legal costs associated with class-action lawsuits. Community banks invest heavily in resolving customer complaints amicably—it is at the core of their business model; however, when claims are unable to be resolved, arbitration is a cost-effective and much more efficient option for the customer and bank over judicial litigation.
“ICBA is also concerned that the collection and possible dissemination of arbitral data—even if it is anonymized—could lead to the re-identification of consumers and the release of sensitive personal and financial information.”