Senate Republicans narrowly passed a resolution to kill a recently adopted Consumer Financial Protection Bureau (CFPB) rule prohibiting financial firms from requiring customers to resolve any disputes with the firms through individual arbitrations.
Big banks and credit card companies routinely include so-called forced arbitration provisions in their account agreements, which prohibit class action.
H.J. Res. 111 was passed by Senate Republicans late October 24, 2017 after Vice President Mike Pence cast the deciding vote to break a 50-50 tie. No democrats voted for the legislation. Sen. Lindsey Graham (R-S.C.) and Sen. John Kennedy (R-La.) also joined the 48 Senate Democrats who voted against the resolution.
The vote paves the way for the rule to be undone with President Donald Trump’s signature. The House passed the same Congressional Review Act resolution, along party lines, in July.
Democrats and consumer groups have for months opposed efforts to undo the rule, citing the use of arbitration clauses by Equifax Inc. and Wells Fargo & Co., both of which have experienced recent scandals. Republicans have suggested that the CFPB’s rule was an unwarranted boon to trial lawyers.