It Sounds Crazy, But You Might Be Able to Sue Your Bank Again Soon
One thing that is too boring for anyone to pay attention to and also will potentially destroy your life is the rise of “forced arbitration” rules that make it extremely hard to sue corporations. But the tide may be turning.
A while back, huge corporations figured out that nobody reads the contracts that you have to sign anyhow, so they might as well stick in clauses that say, in essence, “if you fuck me over I will not sue you in the courts, which could be bad for you—instead I agree to take our dispute to a private arbitrator, who is much more prone to favor corporations over consumers.” Why did you sign that contract??? Well, there is no one to blame for your newfound inability to sue except for you, the millions of unwary consumers.
It has been clear for some time that the wild rise of forced arbitration problems is a systemic problem. Now, the Consumer Financial Protection Bureau has unveiled proposals that would place restrictions on arbitration clauses and once again allow consumers to sue banks, credit card companies, and others who offer financial ripoffs/ products. Here is the extent of the problem, via the Wall Street Journal:
A 2015 agency study showed such clauses were used by 53% of credit-card issuers, 86% of the largest private student loan lenders, and 44% of banks taking insured deposits. The clauses also were included in 92% of prepaid card agreements and 99% of payday loan contracts in some states...
The CFPB’s March 2015 study showed that more than three-quarters of consumers surveyed in the credit-card market didn’t know whether there was an arbitration clause in their contracts.
If you would like to ensure that consumer protections like this never become reality, please vote Republican in this fall’s elections.