Ad Encouraging Senator to Stand Up for Maine Consumers, not Wall Street, Begins Airing Thursday in Maine
WASHINGTON, D.C. – Today, Allied Progress launched a television ad buy in Maine to encourage Sen. Susan Collins (R-ME) to vote against the Congressional Republican effort to repeal the Consumer Financial Protection Bureau’s (CFPB) arbitration rule. The rule protects consumers that have been taken advantage of by big banks and other financial interests from being forced into secret arbitration tribunals where industry-stacked panels call the shots and consumers hardly stand a chance.
The television ad campaign comes just days after one of the largest data breaches in U.S. history, and uses the ensuing scandal surrounding Equifax to illustrate the importance of the CFPB’s rule. The spot, titled “Fine Print,” will begin to run in Maine and will call on Sen. Collins to oppose S.J. Res. 47, legislation that would repeal the CFPB’s rule on forced arbitration. It encourages viewers to visit EndForcedArbitration.org or call 1-866-776-2372 to contact Sen. Collins and urge her to oppose repeal.
“Equifax’s botched attempt to force millions of consumers into arbitration after exposing their most personal information in a devastating data breach shows exactly why the Consumer Financial Protection Bureau’s rule is so important. More than just putting the wellbeing of their constituents in jeopardy, if Senate Republicans are successful in their attempt to repeal the CFPB’s rule, they will encourage even more reckless behavior by the Equifax’s and Wells Fargo’s of the world,” said Karl Frisch, Executive Director of Allied Progress.
“The CFPB’s arbitration rule has broad support because it gives consumers a choice. They can stick with arbitration or band together and and go to court when they are screwed over by big banks and powerful financial corporations. We are hopeful that when Senator Collins hears from her constituents about this issue, she will do the right thing and reject efforts to repeal these important protections,” he continued.
The American Future Fund recently conducted a Maine statewide survey that found 65 percent of respondents favor the Consumer Bureau’s arbitration rule. Thirty-nine percent of respondents view banks and credit card companies unfavorably.
The 24 initial Senate co-sponsors the repeal effort have taken more than $100 million from the financial sector over the course of their careers, according to an analysis by Public Citizen.
Script for “Fine Print” – 30 Seconds
“It’s hidden in fine print. In loan and credit contracts. Big corporations like Equifax tried to sneak it past you. To strip away your rights, and avoid accountability. It’s called forced arbitration…and Wall Street wants Washington to make it permanent. Lobbying to overturn tough new rules. But when it comes to the fine print, she may have the final say. Senator Collins can protect Maine consumers. Her vote can end forced arbitration. Period.”
Maine and the Arbitration Rule by the Numbers
- Servicemembers and Veterans: Banks and lenders use forced arbitration clauses in loans issued to Maine’s 4,650 active-duty servicemembers and reservists and to Maine’s veterans. Forced arbitration blocks servicemembers’ access to the courts for violations of the Servicemembers Civil Relief Act and other misconduct, including illegal repossessions of active- duty servicemembers’ vehicles. Wells Fargo also has arbitration clauses in many of the auto loan contracts that included illegal fees for unneeded auto insurance, including those of active duty servicemembers.
- Bank Account Holders: Wells Fargo opened up to 3.5 million fake accounts – including 217 in Maine – without customers’ consent. Wells Fargo has tried since 2013 to use forced arbitration to block lawsuits, including a class action that would help Mainers. Wells Fargo has also repeatedly tried to use forced arbitration to avoid justice for people in 49 states – including Maine – who were charged excess overdraft fees when their accounts were not overdrawn.
- Consumers with Inaccurate Credit Reports: Hundreds of Mainers have filed complaints with the CFPB about problems with credit reporting agencies and errors in credit reports, which can increase the cost of a loan or result in a denial of credit. Mainers falsely matched with a terrorist watch list will get about $7,337 in relief from a class action against Transunion. But Transunion and other credit bureaus have tried to use forced arbitration to block class actions.
- Payday Loan Borrowers: Over 99% of storefront payday lenders use forced arbitration clauses in their loan agreements in some states. Annually, Mainers pay more than $573,000 in fees associated with payday loans that put Mainers in a cycle of debt. Payday lenders have engaged in abusive lending and illegal debt collection practices.
- Prepaid Card Users: Nearly one in five Mainers are unbanked or underbanked, and many rural and low-income Mainers rely on prepaid cards to manage their money. RushCard holders, including 477 Mainers, and servicemembers serving overseas, were among those harmed when cards were frozen and people could not access their money for weeks. A class action will give class members up to $500 for losses and fees they suffered. The case could have been blocked by a forced arbitration clause, found in 92% of prepaid card contracts.
- Families Subject to Illegal and Abusive Debt Collection Practices: Debt collectors are #1 among Mainers’ and servicemembers’ complaints to the CFPB. Out-of-state debt buyers, who buy consumers’ debt for pennies on the dollar, engage in abusive—and often illegal—financial practices. Debt buyers frequently use arbitration clauses to avoid lawsuits – even when they can’t provide copies of the agreements.
- College Students: Mainers are among those harmed by predatory for-profit colleges, such as Corinthian Colleges, that for years have used forced arbitration clauses to block class actions over their fraudulent conduct. Maine students also average $29,644 in public and private student loan debt and may be impacted by abuses by Navient (formerly Sallie Mae), the largest servicer of private student loans. Navient, which has forced borrowers into arbitration, allegedly “failed to provide the most basic functions of adequate student loan servicing at every stage of repayment.” Mainers may also fall prey to rampant abuses by sketchy student loan debt relief companies, which also use forced arbitration clauses to deny students their day in court.
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Allied Progress uses hard-hitting research and creative campaigns to stand up to Wall Street and powerful special interests and hold their allies in Congress and the White House accountable.