In previous decades Attorneys General across the U.S. joined forces to combat vices such as smoking, asbestos, and sub-prime loans. Their new cause seems to be mandatory arbitration clauses.
In a press release issued August 12, Massachusetts Attorney General Maura Healey announced a letter that she was sending to director of the Consumer Financial Protection Bureau (CFPB) in support of the CFPB’s proposed rule to limit the use of mandatory pre-dispute arbitration clauses in contracts for financial products and services.
The letter was co-sponsored by the attorneys general of New York, California, and Washington, D.C. and joined by another 14 other states. Attorney General Healey argued that ‘[t]he presence of mandatory pre-dispute arbitration clauses in contracts means that many serious violations of law will go undetected, undeterred, and unremedied.”
The press release noted that earlier this month Healey had sent another multi-state sponsored letter to the U.S. Department of Education advocating for ways to strengthen the Department’s Borrower Defense Rule, which seeks to address concerns about the use of arbitration by schools that accept federal student loan dollars.