Government Category: Comments & Letters to Regulators

Insurance companies played a significant role in the 2008 financial crisis, both directly and indirectly. American International Group (AIG), the world’s largest insurance group at the time, was at the epicenter of the crisis, and of course collapsed and required the largest government bailout in U.S. history.

“Americans for Financial Reform (“AFR”) appreciates this opportunity to comment on the above referenced proposed rule (the “Rule”) by the Consumer Financial Protection Bureau (the “CFPB” or “Bureau”) to restrict the use of forced arbitration clauses in consumer finance contracts. Forced arbitration is a system designed to leave consumers with no practical ability to enforce their most basic rights and protections.”

“The undersigned… organizations strongly support the Consumer Financial Protection Bureau (CFPB)’s proposed rule to limit pre-dispute binding mandatory (or forced) arbitration clauses in consumer finance contracts. The CFPB rule, which will restore consumers’ ability to band together in court to pursue claims, is a significant step forward in the ongoing fight to curb predatory practices in consumer financial products and services and to make these markets fairer and safer. “

“This extensive concept release poses many questions concerning technical and detailed issues of disclosure. It is also part of a larger set of efforts relevant to financial disclosures, including the Disclosure Effectiveness Initiative, the Reg S-K study mandated by the JOBS Act, the recent proposed changes to materiality standards by the Financial Accounting Standards Board (FASB), and the lengthy and highly technical proposed rule on Disclosure Update and Simplification released on July 13th.”