Corporate America is lately trying to convince skeptical regulators that consumers should keep complaints out of court and instead use arbitration. While judges are already on board with this, The Consumer Financial Protection Bureau and the Securities and Exchange Commission are just now considering imposition of limits or a ban on “mandatory arbitration clauses” from financial contracts with consumers.

Ballard Spahr’s Alan Kaplinsky, Practice Leader of the firm’s Consumer Financial Services Group, said that if regulators roll back mandatory arbitration, then potentially new litigation risks and costs will be imposed on checking account, credit card, and payday loan providers. “These clauses are utterly ubiquitous in financial services,” said Mr. Kaplinsky.

Recent actions demonstrate the regulatory rollback. This year, for example, the SEC forced The Carlyle Group to remove from its IPO prospectus a clause requiring new shareholders to submit disputes to arbitration. State attorneys general mostly oppose mandatory arbitration as being antithetical to the best interests of consumers.