Consumer Law & Policy Blog

Report: Trump administration affirmatively trying to reduce sign-ups for health insurance under the ACA

This article by AP medical journalist Carla Johnson explains that Trump is not simply letting the Affordable Care Act fail (as he has occasionally pledged to do), but taking affirmative steps to harm the Act by making it harder to sign up for coverage. As the article explains, these actions could, in turn, destabilize markets in some places.

Law360 Interview with Acting Head of FTC's Consumer Protection Bureau Thomas Pahl

Here. Excerpt:

In the area of national advertising, Pahl listed three priorities that indicate a return to a more traditional, conservative approach to law enforcement. First, he said the agency will focus on “fraud” and “quasi-fraud,” similar to the agency’s historic approach to deceptive weight loss and dietary supplement claims. A second priority is health and safety, for example preventing deceptive advertising claims relating to the opioid crisis. Third, the agency will prioritize advertising and marketing directed to certain populations, such as those in the military, those in rural areas, and the elderly. 

New York Law's Center for Justice & Democracy: 9 Examples of Class Actions that Helped Consumers

The report is titled How Consumer Financial Class Actions Help and Protect Americans. Here is an excerpt from the press release:

This report illustrates how anytime, anywhere, an unscrupulous bank or lender could steal money from you, your family, or your small business. ... If, say, a bank opens a fraudulent bank account in your name, charges you fees and ruins your credit; or, a company illegally freezes money in your bank account, or cuts access to your prepaid cards, so you can’t pay your bills or withdraw money; or, a bank makes illegal credit inquiries without your permission and hurts your credit score so you can't get a loan; or, a bank charges you fraudulent mortgage or loan fees and then illegally try to collect the debt.

American Banker: GOP efforts to repeal CFPB arbitration rule off to rocky start

by Jeff Sovern

Here. The article points out that one Republican member of the Senate Banking Committee, John Kennedy of Louisiana, did not agree to cosponsor the Senate CRA resolution to rescind the CFPB rule (he was said to be reviewing the resolution); that Senator McCain's unfortunate health issues may prevent him from voting on the resolution; and that the more moderate Senate Republicans, like Senators Collins and Murkowski, have yet to be heard from on the resolution. Senator Collins voted for the Dodd-Frank Act, which created the CFPB and authorized it to regulate arbitration.

Consumerist: Lawmakers Who Want To Hand ‘Get Out Of Jail Free’ Card To Banks Made Millions From Financial Sector Last Year

Here.  Excerpt:

[T]he two main sponsors — Rep. Jeb Hensarling (TX) and Sen. Mike Crapo (ID) — received a total of $6 million in campaign contributions from the financial sector in 2016, with $1.9 million going to Hensarling’s campaign and $4.1 million going to Crapo.

* * *

Sen. Pat Toomey (PA) received a total of $7 million from this sector in 2016. According to the Center for Responsive Politics, Toomey was the largest recipient of funding from commercial banks last year, * * *

* * * Sen. Bob Corker (TN), whose campaign took in $3.7 million from this sector, * * * Arkansas Senator Tom Cotton raised $2.7 million from financial firms in 2016, * * *

The eight Senate sponsors of this bill received a total of $24 million — an average of $3 million each — in 2016 from the industry that would be most affected by the new rules.

Over in the House, the individual numbers aren’t as large, but they do add up, with the supporting legislators’ campaigns earning more than $22 million from financial companies in the last election cycle.

 

Who Are the "leading scholars" Who Senator Crapo Said Have Criticized the CFPB Arbitration Study "as biased and inadequate"?

by Jeff Sovern

Yesterday, the Senate Banking Committee released a press release that said in part:

Today, U.S. Senate Committee on Banking, Housing and Urban Affairs Chairman Mike Crapo (R-Idaho) and Republican colleagues will file a Congressional Review Act (CRA) Joint Resolution of Disapproval in the Senate against the Consumer Financial Protection Bureau’s (CFPB) arbitration rule.

“Members of Congress previously expressed concerns with the proposed version of the rulemaking – concerns that were not addressed in the final rule,” said Chairman Crapo. “The rule is based on a flawed study that leading scholars have criticized as biased and inadequate, noting that it could leave consumers worse off by removing access to an important dispute resolution tool. * * *

Actually, the CFPB rule does not remove access to a dispute resolution tool. Consumers will still be able to use arbitration to resolve disputes. But ignoring that, who are the "leading scholars"? My guess is it's Jason Scott Johnston of Virginia and Todd J. Zywicki of George Mason who have written The Consumer Financial Protection Bureau's Arbitration Study: A Summary and Critique. I wrote about what I see as serious flaws in an aspect of their paper here.   (HT: Adam Zimmerman)

 

Conservative Commentator Argues Against CRA Challenge to CFPB Arbitration Rule

Dean Clancy in US News has written The GOP's Foolish Decision. Excerpt:

The U.S. Chamber of Commerce urged Congress to kill not only [the arbitration] regulation, but every CFPB rule, on grounds the agency is unconstitutional and therefore all of its actions are invalid.

The GOP would be terribly foolish to go down this road, for three reasons. Forced arbitration is: 1) unconscionable, 2) unconstitutional and 3) a big political loser.

* * *

Is the CFPB itself unconstitutional? Yes, in my opinion. But so is forced arbitration. And Congress has a duty to protect our right to a jury trial.

* * *

Those who vote to overturn the CFPB regulation will be placing themselves on the side of accused sexual harassers, corporate wrongdoers and unscrupulous payday lenders who exploit our troops.

The CFPB is busy at work

The independence of the Consumer Financial Protection Bureau's director is under challenge in the D.C. Circuit. And the agency's arbitration rule is under siege from corporate America and in Congress. Meanwhile, the agency -- because of its independence -- keeps very busy doing the work Congress assigned to it. To see what the CFPB is up to, review its regulatory agenda posted by the Office of Management and Budget or, better yet, read the agency's comprehensive and well-written description of its agenda posted just yesterday.

"FTC probing allegations of Amazon's deceptive discounting"

Reuter's reports that, "[a]s part of its review of Amazon's agreement to buy Whole Foods, the Federal Trade Commission is looking into allegations that Amazon misleads customers about its pricing discounts, according to a source close to the probe. The FTC is probing a complaint brought by the advocacy group Consumer Watchdog, which looked at some 1,000 products on Amazon's website in June and found that Amazon put reference prices, or list prices, on about 46 percent of them. An analysis found that in 61 percent of products with reference prices, Amazon's reference prices were higher than it had sold the same product in the previous 90 days, Consumer Watchdog said in a letter to the FTC dated July 6."

The full story is here.

On the effort to kill the CFPB's access-to-courts rule

Discussing a resolution introduced by two Republican Congressmen to kill the CFPB's arbitration rule, Washington Post columnist Catherine Rampell observes: "For some reason, though, the idea of giving consumers the choice to participate in a court of law — a right enshrined in the Seventh Amendment — leaves some GOP legislators quaking in their loafers."

Her full column in here.