The CFPB would be prohibited from issuing final regulations governing mandatory arbitration agreements until it meets unspecified conditions, according to a proposed FY2017 spending measure.
The House Financial Services Appropriations Subcommittee will mark up its bill Wednesday to fund the CFPB, the Treasury Department and the White House, among other federal offices and agencies.
The draft bill stated that final arbitration rules cannot be issued until the CFPB meets certain requirements in the Appropriations Committee report on the bill. That report is unlikely to be available until the full Appropriations Committee marks up the bill.
Even then, the House bill is simply the first step in the appropriations process.
Earlier this month, the CFPB released proposed rules governing mandatory arbitration clauses found in many contracts.
The agency said such clauses in contracts prevent consumers – including credit union members – from joining together in a suit to accuse financial institutions of wrongdoing.
The proposal does not prohibit arbitration clauses, but it specifies the language that may be used in clauses and emphasizes the fact that consumers can file suit.
Critics of the CFPB have alleged that a study the agency was required to conduct before issuing the rules was poorly conducted and did not meet the statutory requirements of the Dodd-Frank Act.
In addition to delaying the rules, the appropriations measure calls for the CFPB to be governed by a board rather than the director of the agency. That has been proposed in the past, but has never been enacted into law.
Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.
Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking credit union news and analysis, on-site and via our newsletters and custom alerts
- Weekly Shared Accounts podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the commercial real estate and financial advisory markets on our other ALM sites, GlobeSt.com and ThinkAdvisor.com
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
