Last week, the Consumer Financial Protection Bureau (“CFPB”) issued its final study on arbitration, which is the culmination of efforts over the last several years to examine consumer arbitration clauses. The Dodd-Frank Act mandated that the CFPB conduct a study on the use of pre-dispute arbitration clauses in consumer financial markets. The CFPB analyzed six different consumer finance markets and the differences between arbitration awards and judicial awards of damages.
Many of the findings are unsurprising, such as the large number of consumers covered by arbitration clauses and the ability to invoke arbitration in defense of class actions. However, the CFPB offered a number of other findings, including that arbitration clauses allegedly do not lead to lower prices for consumers.
A copy of the report can be found at this link, and despite its 728-page length, it is worth reviewing. Arbitration remains a focal point of the CFPB, particularly as courts in more jurisdictions, such as West Virginia, have enforced arbitration agreements more readily than in the past.
If your institution has any questions about the study or the enforceability of its arbitration clauses in our jurisdictions, please do not hesitate to contact Spilman.