Senate Repeals Rule Letting Americans File Class-Action Suits Against Financial Firms
by Stephen Lendman (stephenlendman.org – Home – Stephen Lendman)
All 48 undemocratic Dems opposed the measure. Two Republicans surprisingly voted with them – neocons Lindsey Graham and John Kennedy.
Neocon Mike Pence broke a 50-50 Senate tie, a giveaway to Wall Street crooks, price-gouging credit card companies, and other financial predators.
When swindled by these firms en masse, consumers will only be able to sue for redress individually once the measure becomes the law of the land, a virtual certainty. House members overturned the rule in July.
Banks, credit card companies, student loan issuers, auto and payday loan companies, along with other financial firms have fine print arbitration clauses in their financial contracts, preventing aggrieved consumers from filing class-action lawsuits, forcing them to arbitrate privately, heavily stacking the odds against them.
A Consumer Financial Protection Bureau (CFPB) rule, scheduled to take effect in 2019, would have restored the right to sue in court.
Wednesday’s vote came under Congressional Review Act provisions, letting a House and Senate majority overturn an executive branch regulation within 60 legislative days of its adoption.
Class-action suits are as much about changing rogue industry practices as compensating aggrieved victims.
CFPB director Richard Cordray called Wednesday’s Senate vote “a giant setback for every consumer in this country. As a result, companies like Wells Fargo and Equifax remain free to break the law without fear of legal blowback from their customers.”
Congressional hardliners consider lawsuits “frivolous” when directed against their industry favorites – swindlers bilking unsuspecting consumers of enormous amounts of money.
Once Trump signs the new measure, it’ll be much harder for them to get redress. In December 2015, the Supreme Court upheld the right of companies to settle disputes by arbitration rather than class-action suits.
At the time, National Association of Consumer Advocates legislative director Christine Hines said “(w)ith forced arbitration, big business writes all the rules. It shields companies from being held accountable for bad practices.”
In 2011, the High Court ruled federal law overrides state law. The 1925 Federal Arbitration Law has final say on this issue.
Consumer advocates explain arbitration is unfair, one-sidedly favoring business, mandating unacceptable take-it-or-leave it offers for consumers.
Public Citizen earlier said arbitrations ruled in favor of banks and credit card companies 94% of the time in disputes with California consumers – over a four-year period studied.
Companies freely sue other firms when disputes arise, settling things in court. They want consumers denied rights afforded them – the way dirty system works in America.
Mike Pence put an exclamation point on it yesterday by breaking a 50-50 Senate vote, Trump to add his own when the rule repeal reaches his desk.
My newest book as editor and contributor is titled “Flashpoint in Ukraine: How the US Drive for Hegemony Risks WW III.”