A new report released yesterday from the U.S. Treasury Department said that the Consumer Financial Protection Bureau’s (CFPB) rule banning banks and credit card companies’ ability to prevent customers from banding together to sue them relies on insufficient research and is misguided, Reuters reported. The CFPB rule abolishing “mandatory arbitration clauses” was released on July 10, and was immediately threatened by Republicans in Congress and President Donald Trump’s administration. In its report, the Treasury said that the CFPB failed to meet its statutory requirements in analyzing the need for the ban and in drafting the rule. “The bureau failed to meaningfully evaluate whether prohibiting mandatory arbitration clauses in consumer financial contracts would serve either consumer protection or the public interest,” the Treasury said in its report.
