Thursday’s field hearing in Albuquerque, N.M., illustrated the credit union difference to the Consumer Financial Protection Bureau (CFPB), particularly regarding its proposed rule on arbitration clauses, which was released early Thursday.
The proposal would effectively eliminate pre-dispute arbitration and would require financial institutions to insert language into their arbitration agreements reflecting this limitation. (See related story: Arbitration rule should take member-owned CUs into account.)
The field hearing featured representatives from the CFPB, consumers and other stakeholders. Kevin Hammar of Aldridge, Hammar, Wexler & Bradley P.A. testified on behalf of CUNA. During his remarks, Hammar expressed dismay that credit unions continued to be lumped in with entities that prey on consumers.
“Our basic concern is the nature of the regulation, the one-size-fits-all approach,” he said. “In my experience in New Mexico, credit unions have neither used nor relied upon arbitration provisions in consumer credit relationships.”continue reading »