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Commentary By James R. Copland

MI Responds: CFPB Arbitration Rule Repealed

Economics, Economics, Governance Finance, Regulatory Policy, Civil Justice

The Senate may have been unable to move some of the GOP leadership’s preferred agenda, but it deserves kudos for acting under the Congressional Review Act to undo an anti-arbitration rule crafted by Obama administration holdovers.

Make no mistake: the anti-arbitration rule was designed exclusively to benefit plaintiffs’ lawyers, and it would have ensured that consumers injured by financial companies would have no redress unless lumped into massive class-action lawsuits that paid them pennies on the dollar. The Senate’s action rolls back the Obama-era overreach — to the benefit of all except the litigation lobby.

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James R. Copland is a senior fellow and director of legal policy at the Manhattan Institute.