Federal regulators continued to trade words yesterday over a new rule favoring class-action lawsuits for financial products, the Washington Examiner reported. Consumer Financial Protection Bureau director Richard Cordray defended the finalized the rule limiting mandatory arbitration that was proposed last week. In response to acting comptroller Keith Noreika's call to halt the rule to allow him to examine whether it could hurt banks, Cordray said in a letter sent yesterday that there isn't "any plausible basis" for Noreika's concerns. The impact of the rule would be less than $1 billion annually, Cordray said. "So on what conceivable basis can there be any legitimate argument that this rule poses a safety and soundness issue?" he asked. Calling Noreika's claim "plainly frivolous," Cordray added that he questioned the appropriateness of the review. Noreika responded yesterday that he appreciated Cordray sharing the data underlying the analysis of the rule's impact on banks and said that he and his staff would conduct their own review of the bureau's analysis of how the rule could affect banks.
