Financial Services Arbitration is Better for Consumers

Floor Speech

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Mr. BARR. Mr. Speaker, I rise today to explain my opposition and vote against the bill that was on the floor earlier today, H.R. 1423, the Forced Arbitration Injustice Repeal Act. I would like to highlight its negative impact on financial services.

Financial services providers and their customers use arbitration to settle disputes because it is easier, faster, and less costly for consumers than litigation. Forcing parties into litigation would dramatically extend the time before a customer is made whole and would significantly increase legal fees for all parties.

These increased costs are ultimately passed along to consumers through higher fees and fewer options, and they would negatively impact any American who has a bank account, credit card, or retirement plan. We have had that debate before.

Dodd-Frank directed that the Consumer Financial Protection Bureau promulgate a rule on mandatory arbitration. While Congress overturned that rule in 2017 because it would adversely impact consumers, the Obama administration's own study found that the average consumer receives approximately $5,400 through arbitration and only $32 through a class action lawsuit. That means the average customer who prevailed in arbitration received 166 times more than the average class member in class action settlements.

Mr. Speaker, my time has expired, but I would urge opposition to this wrongheaded idea in the United States Senate. RECOGNIZING BURMA BEAL'S 100TH BIRTHDAY

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