On November 1st President Trump signed into law H.J. Res. 111, the resolution passed by the House and Senate to repeal the Consumer Financial Protection Bureau (CFPB)’s arbitration rule. This Congressional action also ensures that the CFPB cannot reissue the arbitration rule with similar prohibitions and requirements for companies using arbitration agreements, or issue a new similar rule without Congressional action. This is a victory for credit unions on the class action lawsuit front, as the CFPB rule encouraged class action lawsuits which would impose major costs on credit unions and consumers; a Treasury report released on October 23rd cited this CFPB rule would generate more than 3,000 class action lawsuits imposing more than $500 million in additional legal defense fees. This repeal comes at a good window of time before credit unions felt the full effect of the arbitration rule, as the CFPB rule became effective just this September, with a mandatory compliance date for March 2018.
In related class-action lawsuit news, on October 31st 61 bipartisan members of Congress (including eight from Georgia) wrote to the Department of Justice requesting action on its long-delayed rules related to website accessibility under the American with Disabilities Act. Credit unions (along with other industries) across the country have been hit with demand letters from a California law firm regarding purported website compliance violations. Our thanks to the Georgia legislators who signed onto this letter on behalf of credit unions: Reps. Rick Allen, Sanford Bishop, Buddy Carter, Doug Collins, Drew Ferguson, Jody Hice, Barry Loudermilk, and Rob Woodall. In addition, CUNA and CUNA Mutual Group sat down with Department of Justice officials on October 31st asking that they act to curtail the threat of frivolous and predatory legal action against credit unions. Stay tuned!
