As expected, Senate Republicans on Thursday introduced a “resolution of disapproval” that begins the process of repealing the Consumer Financial Protection Bureau’s newly unveiled rule that bans companies from using mandatory arbitration clauses.
Twenty-three Senate Republicans filed a resolution on Thursday that would make use of Congress’ authority under the Congressional Review Act to rescind the CFPB rule.
Under the Congressional Review Act, Congress may overturn a broad range of regulatory rules issued by federal agencies by enacting a joint resolution of disapproval within 60 days of the rules being announced.
The Republican effort in the Senate is led by a number of prominent Republicans, but one of the top Democrats in the Senate is pledging a serious fight over the CFPB arbitration rule.
“Almost a year after millions of fake accounts were uncovered, Wells Fargo is still using fine print arbitration clauses to cheat those customers out of the justice they deserve,” Sen. Sherrod Brown, D-Ohio, said.
Brown is the ranking member of the Senate Committee on Banking, Housing, and Urban Affairs.
“Overturning the arbitration rule will help banks and payday lenders continue getting away with cheating customers, and I intend to put up one hell of a fight,” Brown said.
“Wall Street banks and payday lenders have armies of lobbyists and lawyers on their sides,” Brown added. “Our job is to fight for the servicemembers, student borrowers, seniors, and hardworking Americans who depend on the Consumer Financial Protection Bureau to look out for them.”
Brown’s counterpart on the Senate Committee on Banking, Housing, and Urban Affairs, Sen. Mike Crapo, R-Idaho, said that it is “incumbent” on Congress to overturn the CFPB rule.
“Members of Congress previously expressed concerns with the proposed version of the rulemaking – concerns that were not addressed in the final rule,” Crapo said.
“The rule is based on a flawed study that leading scholars have criticized as biased and inadequate, noting that it could leave consumers worse off by removing access to an important dispute resolution tool,” Crapo continued.
“By ignoring requests from Congress to reexamine the rule and develop alternatives between the status quo and effectively eliminating arbitration, the CFPB has once again proven a lack of accountability,” Crapo added. “Given the problems with the study and the Bureau’s failure to address significant concerns, it is not only appropriate but incumbent on Congress to vote to overturn this rule.”
Joining Crapo in introducing the Senate resolution are Sens. John Barrasso, R-Wyoming; Roy Blunt, R-Missouri; Shelley Moore Capito, R-West Virginia; Thad Cochran, R-Mississippi; Bob Corker, R-Tennessee; Tom Cotton, R-Arkansas; Ted Cruz, R-Texas; Mike Enzi, R-Wyoming; Orrin Hatch, R-Utah; Dean Heller, R-Nevada; Johnny Isakson, R-Georgia; James Lankford, R-Oklahoma; Jerry Moran, R-Kansas; David Perdue, R-Georgia; Mike Rounds, R-South Dakota; Marco Rubio, R-Florida; Ben Sasse, R-Nebraska; Tim Scott, R-South Carolina; Richard Shelby, R-Alabama; Luther Strange, R- Alabama; Thom Tillis, R-North Carolina; Patrick Toomey, R-Pennsylvania; and Roger Wicker, R- Mississippi.
There are now efforts in both the Senate and House of Representatives to stop the CFPB rule.
Earlier in the day, Republicans in the House introduced their own resolution of disapproval that would use Congress’ authority under the Congressional Review Act to “repeal this harmful rule and prevent the Bureau from issuing any similar rule relating to arbitration.”
The resolution is co-sponsored by all 34 Republicans on the House Financial Services Committee.