Senate Leaders Undecided on Vote to Kill CFPB’s Arbitration Rule

By Rob Tricchinelli

The Senate has yet to schedule a vote on repealing a federal rule that prevents financial firms from steering customer disputes into arbitration, according to several Republican senators.

Senate leaders are still weighing whether to vote on reversing the Consumer Financial Protection Bureau’s (CFPB) arbitration rule, Sen. John Thune (R-S.D.), a member of Senate leadership, told Bloomberg News Sept. 26, citing issues with the whip count.

Sen. Lindsey Graham (R-S.C.) has said he opposes overturning the rule and Sen. John Kennedy (R-La.) told Bloomberg BNA Sept. 26 he’s still undecided. Republicans have a slim 52-seat majority in the chamber and can afford few defections, with Senate Democrats strongly in favor of keeping the rule.

The CFPB’s rule bars the use of mandatory arbitration to block class-action lawsuits. The clauses are common in contracts for credit cards, checking accounts, payday loans, and other consumer financial products. It was completed in July.

Kennedy said Republican leadership had been whipping the vote this week, but Majority Leader Mitch McConnell (Ky.) made no announcements at his weekly news conference. Using the Congressional Review Act, lawmakers could undo the rule with only simple majorities in both chambers.

Sen. Mike Crapo (R-Idaho), who chairs the Senate Banking Committee, told reporters Sept. 26 that he wasn’t aware of any scheduled vote on the CRA resolution that would undo the rule, and that he had to talk to McConnell about it.

The Senate’s ability to use a simple majority expires after 60 legislative days beyond the rule’s adoption.

To contact the reporter on this story: Rob Tricchinelli in Washington at rtricchinelli@bna.com

To contact the editor responsible for this story: Michael Ferullo at MFerullo@bna.com

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.