A U.S Federal consumer watchdog agency has issued a new rule that will prevent credit card companies and banks from requiring customers to agree to settle disputes by arbitration rather than going to court.  The Consumer Financial Protection Bureau explained:

“Hundreds of millions of contracts for consumer financial products and services have included mandatory arbitration clauses. These clauses typically state that either the company or the consumer can require that disputes between them be resolved by privately appointed individuals (arbitrators) except for individual cases brought in small claims court. While these clauses can block any lawsuit, companies almost exclusively use them to block group lawsuits, which are also known as ‘class action’ lawsuits.”

CFPB Director Richard Cordray said the current rules “make it nearly impossible for people to take companies to court when things go wrong.” He said the new rules would “stop companies from sidestepping the courts.”. The requirement is set to take effect in 60 days.

The Associated Press notes: “Consumer advocates have been pushing for years for stricter federal regulation of these types of clauses. But the move is likely to face pushback from the banking industry and the Republican-controlled Congress.”  (NPR website , July 11, 2017)

The arbitration clause is a little mentioned disgrace, but an important brick in the structure of the American oligarchy (or Rule by Corporation).  How many people read the almost unreadable bit of paper that comes with your new credit or debit card, and which you are deemed to approve?  Deep in the tortured wording you will find that the the financial organisation you are dealing with insists that all claims against the company are dealt with, not in the people’s court of law, but by a three judges, usually appointed by the company itself.  The result?  Well, you can imagine. Statistically most cases are found in favour of the financial company.  Class action suits, which can cost companies large amounts, are barred.  Congress has allowed this burden on the consumer for obvious electoral fundraising reasons.  You can be sure that the Republicans will kill the civilised rule if it can, along with the Consumer Financial Protection Bureau itself.  Nothing must stand in the way of profit!