Sen. Brown introduces bill to allow consumers to file class-action suits against financial companies

Financial Regulation News
Tuesday, March 5, 2019

U.S. Sen. Sherrod Brown (D-OH) introduced legislation last week that would end the practice of forced arbitration and allow consumers to file class action suits against financial companies.

The Arbitration Fairness for Consumers Act would also ensure that financial crimes cannot be hidden from the public in a private and opaque process.

“Forced arbitration is about big companies silencing victims and giving more power to corporations that already have too much power over the lives of working Americans,” said Brown, ranking member of the U.S. Senate Committee on Banking, Housing, and Urban Affairs. “Ending the use of forced arbitration in student loans, credit card agreements, and employment contracts gives working Americans a fighting chance against powerful special interests.”

This bill would overturn legislation which passed Congress in 2017 to eliminate the ability of consumers to file class-action suits against banks and credit card companies. Instead, it instituted the use of arbitration clauses, which require people to bring claims individually against the company, outside the court system, before a private individual (an arbitrator).

The Arbitration Fairness for Consumers Act has been endorsed by the American Association for Justice, Americans for Financial Reform, the Communications Workers of America, UndiosUS, Public Citizen, Consumer Reports, U.S. Public Interest Research Group, the National Consumer Law Center, the National Association of Consumer Advocates, the Center for Responsible Lending, Consumer Action, the Center for Justice and Democracy, and Consumers for Auto Reliability and Safety.

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