CFPB benefits trial lawyers, hurts consumers

Press Release

This morning, Congressman Robert Pittenger (NC-09) and all 33 Republican colleagues on the House Financial Services Committee introduced a resolution of disapproval to nullify a controversial new rule benefitting trial lawyers at the expense of consumers.

H.R. Res. 111, which Congressman Pittenger introduced in partnership with Congressman Keith Rothfus (PA-12), uses the Congressional Review Act to repeal the Consumer Financial Protection Bureau's new "anti-arbitration" rule.

"According to CFPB's own study, consumers recover 167 times more through arbitration than class action. On average, consumers receive $32 in class action, while the attorney receives nearly $1 million," said Congressman Pittenger. "Perhaps we should rename CFPB the "Trial Lawyers Protection Bureau,' because this rule certainly doesn't benefit the average American."

According to the Consumer Financial Protection Bureau:

Arbitration is 12 times faster than litigation.
The cost to file a complaint under arbitration is roughly half the cost of filing a complaint in federal court.
On average, consumers recover $5,389 via arbitration, but only $32.35 via class action.

Despite their own findings, the Consumer Financial Protection Bureau recently published a new rule requiring most financial companies to allow class action lawsuits, opening another door for unscrupulous attorneys to prey on hardworking Americans.

Source