WASHINGTON—The House of Representatives Tuesday passed a resolution (voting 231-190) of disapproval for the Consumer Financial Protection Bureau’s arbitration rule that would restrict the use of arbitration agreements.
The resolution would use the Congressional Review Act to repeal the rule and prevent the CFPB from issuing any similar rule relating to arbitration.
Released in final form earlier this month, the CFPB's arbitration rule prohibits the use of arbitration agreements for the purpose of limiting access to class-action litigation. It is set to take effect Sept. 18; compliance is mandatory for pre-dispute arbitration agreements entered into on or after March 19, 2018.
“CUNA, the leagues and credit unions fully support Congress and its efforts to repeal the CFPB’s arbitration rule and we will continue to actively engage with the Senate on this important issue,” said Jim Nussle, CUNA president/CEO. “Credit unions frequently work with members to provide refunds, work out payment plans, and find other solutions to resolve a dispute. In its final rule the CFPB declined to recognize the unique size and structure of credit unions in the rule or the harm that class action litigation can cause to credit unions and their members.”
CUNA sent a letter of support for the resolution to Congress in advance of Tuesday’s vote.
NAFCU commented on Tuesday's vote.
"NAFCU appreciates the House taking up this effort in a timely manner," said NAFCU Vice President of Legislative Affairs Brad Thaler. "While NAFCU strongly supports consumer protections, the arbitration rule as written would stand to benefit trial lawyers at the expense of consumers and credit unions."
As CUToday.info reported, the House resolution (HJ Res. 111) to repeal the CFPB rule was introduced last week by Rep. Keith Rothfus (R-PA) and House Financial Services Financial Institutions and Consumer Credit Subcommittee Chairman Blaine Luetkemeyer (R-MO). Senators, nearly all of them sitting on the Senate Banking Committee, have also filed a resolution (S.J. Res. 47) to repeal the rule.