Anti-Arbitration Rule Rescinded

Yesterday, November 1st, the President signed H.J. Res 111 into law, rescinding the Consumer Financial Protection Bureau's (CFPB) anti-arbitration rule pursuant to the Congressional Review Act. 

As SFIG reported last week, the U.S. Senate previously voted on October 24th to repeal the CFPB rule banning mandatory arbitration clauses in financial contracts. Senate Republicans used the Congressional Review Act to overturn the recently finalized rule, with Vice President Mike Pence casting the tie breaking vote (51-50). 

SFIG previously submitted a comment letter outlining our members' concerns about the negative impact that limiting the use of arbitration clauses would have on the securitization market, due to uncertainty created for the consumer credit assets underlying structured transactions.

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