Acting Comptroller of the Currency Keith Noreika today expressed concern over the Consumer Financial Protection Bureau’s controversial final arbitration rule, noting that it may negatively affect banks’ ability to serve their customers.
“The final rule prevents banks from using an effective risk mitigation tool and will eliminate one option consumers have to resolve their concerns without the cost and delay of litigation,” Noreika said. “Ultimately, the rule may have unintended consequences for banking customers in the form of decreased availability of products and services, increased related costs, fewer options to remedy consumer concerns and delayed resolution of consumer issues.”
Noreika added that the OCC has requested additional data from the CFPB as it conducts a thorough review of the arbitration rule, and expressed support for efforts in Congress to overturn the rule through the Congressional Review Act process. The House last week voted to overturn the rule, and a similar measure has been introduced in the Senate by Banking Committee Chairman Mike Crapo (R-Idaho).
The American Bankers Association has been vocal in its opposition to the arbitration rule, noting that arbitration is a faster, cheaper and more effective way to resolve consumer disputes. In a recent op-ed in The Hill, ABA President and CEO Rob Nichols pointed out that the arbitration rule — which would largely eliminate the use of mandatory arbitration contracts in financial services — amounts to “a regulatory windfall to trial lawyers at consumers’ expense.”