Equifax aside, consumers may never get to easily sue financial firms

Personal Finance

A new federal rule takes effect today that makes it easier for customers to band together and sue financial firms.

Consumers, however, might not get to use it.

That’s because a congressional resolution to kill the measure is awaiting action in the Senate. And despite the recent uproar over the inclusion of a mandatory arbitration clause by credit-reporting company Equifax in its free credit-monitoring service agreement — which the company subsequently removed — there’s no indication the legislative action is doomed.

“I don’t think the Equifax brouhaha is going to move the needle on whether the resolution is going to pass or not,” said Alan Kaplinsky, a partner with national law firm Ballard Spahr. “It still could go either way.”

The rule, approved by the Consumer Financial Protection Bureau in July, generally prevents financial firms like credit-card companies and banks from including clauses in agreements that require customers to settle complaints through arbitration, thereby waiving their right to join a class-action lawsuit. While it takes effect today, only new agreements after March 18, 2018, would reflect the change.

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