In a move that Senator Elizabeth Warren called “a giant wet kiss to Wall Street,” the Republican majority in the U.S. Senate just pushed through a bill overturning the Consumer Financial Protection Bureau (CFPB), making it extremely difficult for consumers to sue banks for their wrongdoing.
The CFPB was put in place in the wake of the massive financial crisis that plunged this country into a recession in the early ’00s. In the middle of the financial meltdown, consumers realized that they couldn’t team up for class action lawsuits to sue their banks over their screw-ups, because buried in the fine print of their banking contracts were mandatory arbitration clauses. The CFPB forced banks to remove those clauses, so consumers had a very effective line of defense against the banks.
Now, on a 51-50 vote (VP Mike Pence was called in to break the tie) the Republicans pushed through a reversal of the rule and mandatory arbitration is once again the law of the land. The move is all a part of the Republican majority’s push to roll back regulations that they believe hurt the free market. The White House applauded the move.
“Tonight’s vote is a giant setback for every consumer in this country,” said CFPB director Richard Cordray said in a statement. “Wall Street won and ordinary people lost.”