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NAFCU, trades call arbitration ‘fair, effective, and less expensive’ ahead of Senate hearing
NAFCU along with other industry trades Monday wrote to the Senate Banking, Housing, and Urban Affairs Committee, ahead of its hearing to discuss arbitration in financial services products, to reiterate the benefits of arbitration for consumers.
“Arbitration is a fair, effective, and less expensive means of resolving disputes compared to going to court and should be preserved for all consumers, including those utilizing financial services products,” wrote the trades.
The authors of the letter noted that arbitration results in consumers recovering more money, resolving claims more quickly than litigation, and generally finding it easier to navigate than court procedures.
In 2017, the CFPB finalized an arbitration rule that would have prohibited the use of arbitration agreements to limit access to class action litigation. That rule was ultimately overturned by Congress using its Congressional Review Act authority, a move NAFCU supported. Of note, the association was the only credit union trade group in attendance when former President Donald Trump signed the congressional joint resolution to overturn the rule in November 2017.
NAFCU has heavily advocated against legislative efforts to restore the CFPB’s rule urging lawmakers to oppose legislation that would limit consumers, small businesses, and employees' ability to remedy disputes.
Read the full letter. NAFCU continues to fight to retain the arbitration process to help credit unions use arbitration over complex and costly means to resolve disputes.