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WASHINGTON, DC—Today, the U.S. House Financial Services Subcommittee on Financial Institutions and Consumer Credit will hold a hearing to consider whether the Consumer Financial Protection Bureau’s (CFPB) new rule to limit the financial industry’s use of forced arbitration is in the public interest and for the protection of consumers. Though the assembled panel of industry representatives will likely disagree, a diverse coalition 164 consumer, civil rights, labor, and community groups make clear that the proposal is a crucial step to hold big banks and other financial organizations accountable when they break the law.

"Consumer Action commends the CFPB for seeking to limit big banks’ and other financial companies’ efforts to escape accountability. Consumers' ability to join together in a class action lawsuit deters unfair and illegal corporate practices," said Consumer Action’s Director of National Priorities Linda Sherry. “We urge the Bureau to use the full force of its authority to restore consumers’ rights to choose how to resolve disputes with financial institutions in this and every context."

In a letter sent to the CFPB last month, 164 groups called on the agency to ban forced arbitration—an abusive practice in which corporations use fine print buried in take-it-or-leave-it contracts to block consumers from challenging predatory practices such as hidden fees, fraud and other illegal behavior.

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Consumer Action has been a champion of underrepresented consumers nationwide since 1971. A non-profit 501(c)(3) organization, Consumer Action focuses on consumer education that empowers low- and moderate-income and limited-English-speaking consumers to financially prosper. It also advocates for consumers in the media and before lawmakers to advance consumer rights and promote industry-wide change.

By providing consumer education materials in multiple languages, a free national hotline, a comprehensive website (www.consumer-action.org) and annual surveys of financial and consumer services, Consumer Action helps consumers assert their rights in the marketplace and make financially savvy choices. Nearly 7,000 community and grassroots organizations benefit annually from its extensive outreach programs, training materials and support.