The Senate voted Tuesday night to kill a controversial pending rule that would have allowed Americans to file class-action suits against banks instead of being forced into private arbitration or small claims court.
…The move by the Senate followed a similar action by the House in July to rescind the rule. …Trump is expected to sign the repeal legislation, providing a major victory for the financial industry.
…Pence cast the deciding vote after the Senate tied 50-50. All but two Republicans — John Kennedy of Louisiana and Lindsey Graham of South Carolina — voted to repeal the rule. No Democrats or independents supported the move.
…For years, Wells Fargo used arbitration clauses to block lawsuits from customers who alleged that unauthorized accounts had been opened in their names. Ultimately, the bank estimated that as many as 3.5 million such accounts were opened.
The bank agreed to settle some class-actions suits, but not until the CFPB, the Office of the Comptroller of the Currency and the Los Angeles city attorney’s office fined the bank over those practices last year. Even in cases that the bank settled, it had argued that the plaintiffs could not sue because of arbitration clauses.
Democrats cited the Wells Fargo case and the recent massive data breach at credit reporting company Equifax as proof that the new CFPB rule was needed to protect consumers from abuses.
Equifax has been criticized for initially making consumers give up their right to sue if they wanted to take advantage of the company’s offer of free credit monitoring and identity theft protection after the breach. Equifax later backtracked on that requirement after a public uproar.
…Last year, congressional Republicans tried to repeal a consumer bureau rule for retirement advisors. The measure passed the House and Senate, but Obama vetoed it.
On Monday, the Treasury Department issued a report slamming the arbitration rule as flawed and a giveaway to class-action attorneys.
Just in case you were deluded into thinking the Congressional GOP is looking out for voters.