Sen. John Neely Kennedy (R-La.) is one of a handful of lawmakers who could squash the finance industry’s dream of tweaking a key Consumer Financial Protection Bureau regulation on arbitration agreements. So far, he’s not saying whether he will or won’t, Bloomberg News reported. The CFPB's new rule would make it easier for customers to sue financial institutions, and banks have spent millions to keep arbitration as the required venue for dispute resolution instead. The CFPB rule restricts financial firms from forcing consumers to resolve their disputes through closed-door arbitration instead of addressing grievances in open court. Consumer advocates argue that without it, banks can’t be held accountable for cheating customers. Banks hate the rule because it opens them up to costly class-action lawsuits. Republican lawmakers say that the CFPB used a flawed method to create the rule. In their attempts to reverse the rule, Republicans are relying on the Congressional Review Act, which lets lawmakers undo regulations with a simple majority within 60 legislative days of their publication. The House of Representatives has already passed a measure reversing the rule. Senators, led by Banking Committee Chairman Mike Crapo of Idaho, have introduced their own version. Republicans can only afford to lose two votes from their own party if it is to pass the Senate.
