A proposal by the Consumer Financial Protection Bureau to restrict arbitration clauses on credit card, bank account, and other contracts already is meeting resistance from the financial services industry, which could challenge any final rules.

“I think it’s very vulnerable to a legal challenge,” said Alan Kaplinsky, a partner at Ballard Spahr.

The CRPB was given authority under the Dodd-Frank Act to review mandatory arbitration clauses which often include waivers prohibiting class-action lawsuits by consumers to resolve problems on their credit cards, checking accounts, payday loans, or credit reports, and to take action to restrict those clauses if it is determined that they harm consumers.

Related Practices

Consumer Financial Services
Consumer Financial Protection Bureau
Bank Regulation and Supervision