July 8, 2016
For Immediate Release:
Funding Bill Packed with Riders to Obstruct the Consumer Financial Protection Bureau
Statement of Christine Hines, Legislative Director, National Association of Consumer Advocates
The U.S. House of Representatives last night voted and passed H.R. 5485 – Financial Services and General Government Appropriations Act, 2017
Washington, DC – The U.S. House of Representatives' passage of the Financial Services and General Government Appropriations Act (239-185) last night shows that some in Congress will condition critical funding of our federal government on the addition of unrelated, ideological riders. In particular, there are harmful policies in the spending bill aimed at tearing down the Consumer Financial Protection Bureau, including a rider to block ongoing rulemaking on forced arbitration clauses in consumer financial contracts.
This spring, the CFPB issued a proposed rule that would curb one of the most inequitable corporate practices in the financial sector: fine print that eliminates consumers’ right to a day in court. Forced arbitration clauses in financial contracts steer individuals into a private proceeding, instead of open court, to resolve disputes with financial firms. It is a rigged system that favors corporations over consumers.
The CFPB’s wide-ranging, data-driven study proves that forced arbitration restricts consumers’ choices and facilitates reckless and illegal business conduct in the financial marketplace.
In addition to thwarting the CFPB’s arbitration rule, the spending bill seeks to hamper the CFPB’s good work in numerous other ways, including riders that would turn it into a five-member commission; change its funding source from the Federal Reserve to the demonstrably political appropriations process; and interfere with its auto financing guidance.
We appreciate lawmakers’ efforts to remove some of the damaging proposals. Representatives Keith Ellison (D-MN) and Hank Johnson (D-GA) introduced an amendment to strip the provision that would obstruct the CFPB’s arbitration rule, but unfortunately, the amendment did not pass (181-236).
In last night’s vote, Wall Street interests prevailed over the interests and rights of American consumers. Congress can and should fund the government without indulging corporate interests and their harmful policies.
More on the CFPB’s forced arbitration rule: http://www.consumeradvocates.org/blog/2016/everything-you-need-know-about-cfpbs-forced-arbitration-rulemaking