The Consumer Financial Protection Bureau (CFPB) recently released its long awaited Report to Congress on arbitration agreements in consumer financial contracts. The Report’s conclusion, and Director Richard Cordray’s remarks, were as expected: consumers are better served by litigation—and particularly, class action litigation—than by agreements to arbitrate disputes. But after spending almost three years analyzing the issue, the 700-page Report does not appear to back up that conclusion. Rather, the evaluation of arbitration agreements, including class action waivers, requires complex value judgments that are not suited to the Bureau’s data-driven approach. Here’s our summary and analysis of the CFPB’s findings, along with a roadmap of what comes next.

WHAT DID THE BUREAU FIND? -

In its Report, the CFPB evaluated: (1) the prevalence and features of arbitration agreements; (2) consumer understanding of arbitration agreements; (3) how arbitration procedures differ from judicial procedures; (4) the types and resolutions of claims in arbitration; (5) the types and resolutions of claims in litigation; (6) suits brought in small claims courts; (7) the value of class action settlements; (8) the relationship between public enforcement and class actions; and (9) whether arbitration clauses lower prices for consumers.