WASHINGTON (10/23/15)--Consumer Financial Protection Bureau (CFPB) Director Richard Cordray provided more information on the bureau’s look at arbitration clauses during remarks to the Consumer Advisory Board Thursday.
A CUNA member participated in a field hearing on arbitration clauses hosted earlier this month by the CFPB
“The central idea of the proposals we are considering is to restore to consumers the rights that most do not even know had been taken away from them,” Cordray said Thursday. “Companies should not be able to place themselves above the law and evade public accountability by inserting the magic word 'arbitration' in a document and dictating the favorable consequences.”
Because credit unions are member-owned cooperatives, they are more likely to resolve disputes with members without arbitration or litigation. However, for the small number of credit unions that do use arbitration clauses, there can be member benefits to this dispute resolution process.
John Ruby, senior vice president/chief lending officer at Bellco CU of Greenwood Village, Colo., participated in a field hearing that the CFPB held on arbitration earlier this month.
“We are accountable to our members, and therefore it is critical we provide an overall experience that causes our members to choose us for their financial services products,” he said during his testimony. “That experience includes price, value, convenience and how we conduct business.”
At the hearing, the CFPB released proposals for consideration by a Small Business Review Panel, which will convene next Oct. 28. CUNA Chief Advocacy Officer Ryan Donovan said CUNA is currently reviewing the CFPB proposals on arbitration to determine any potential adverse implications for credit unions and CUNA plans to weigh in on the proposals under consideration for the panel.