Last April, the CFPB announced that it was beginning its study of consumer arbitration as mandated by Section 1028 of the Dodd-Frank Act. Last week, nearly a year after that announcement, David Silberman, the CFPB’s Associate Director for Research, Markets, and Regulations, sent a letter to four Republican House members responding to their letter inquiring about the arbitration study.
The CFPB’s announcement was accompanied by the publication of a Request for Information (RFI) seeking public comments on four main topics dealing with the scope, methodology and data sources of the study. In his letter, Mr. Silberman stated that the CFPB’s initial work will be focused on two of those areas: first, the prevalence and content of arbitration clauses across different consumer financial products and services markets and second, the types of disputes consumers bring in arbitration and in the court system. Mr. Silberman noted that the CFPB has hired Professor Christopher Drahozal of the University of Kansas Law School to work on the study, and is working with Professor Drahozal to expand his analysis of the use of pre-dispute arbitration clauses in credit card agreements into other product areas.
Mr. Silberman also stated that there is a pending FOIA request relating to the study and that, if the CFPB were to expand the study beyond the topics identified in the RFI, it would “consider an opportunity for further comment before any such expansion.” His letter also includes the now standard CFPB refrain that the Canning decision “did not involve the CFPB and has no effect on the Bureau’s work.”