Mandatory Arbitration in Consumer Finance and Investor Contracts

Michael S. Barr
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引用次数: 8

Abstract

Mandatory pre-dispute arbitration clauses are pervasive in consumer financial and investor contracts — for credit cards, bank accounts, auto loans, broker-dealer services, and many others. These clauses often ill serve households. Consumers are typically presented with contracts on a “take it or leave it” basis, with no ability to negotiate over terms. Arbitration provisions are often not clearly disclosed, and in any event are not salient for consumers, who do not focus on the importance of the provision in the event that a dispute over the contract later arises, and who may misforecast the likelihood of being in such a dispute. The lack of salience means that there is no meaningful competition over arbitration provisions or likely any price effect. Some arbitration proceedings lack procedural protections, and unbiased arbitrator selection essential for fair outcomes. In addition, many arbitration provisions contain “gag” rules barring disclosure of reasoning, evidence, or outcomes. Moreover, arbitration clauses typically preclude consumers from banding together in aggregated actions, which diminishes redress and weakens deterrence. In the wake of the financial crisis, Congress enacted the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which authorizes the new Consumer Financial Protection Bureau and the U.S. Securities and Exchange Commission to prohibit or condition the use of arbitration clauses in consumer finance and investment contracts, respectively. It is well past time for these agencies to use this authority.
消费者金融和投资者合同中的强制仲裁
强制性的争议前仲裁条款在消费者金融和投资者合同中普遍存在——信用卡、银行账户、汽车贷款、经纪自营商服务以及许多其他合同。这些条款往往不利于家庭。消费者通常在“接受或放弃”的基础上签订合同,没有能力就条款进行谈判。仲裁条款往往没有明确披露,而且在任何情况下对消费者来说都不突出,消费者不会关注该条款在以后出现合同争议时的重要性,他们可能会错误地预测陷入此类争议的可能性。缺乏显著性意味着在仲裁条款方面不存在有意义的竞争,也不可能产生任何价格效应。一些仲裁程序缺乏程序保护,公正的仲裁员选择对公平结果至关重要。此外,许多仲裁条款包含禁止披露推理、证据或结果的“插科打诨”规则。此外,仲裁条款通常禁止消费者联合起来采取集体行动,这减少了补救措施,削弱了威慑力。金融危机之后,国会颁布了《多德-弗兰克华尔街改革和消费者保护法案》(Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010),授权新的消费者金融保护局(Consumer financial Protection Bureau)和美国证券交易委员会(Securities and Exchange Commission)分别禁止或限制在消费者金融和投资合同中使用仲裁条款。这些机构早就应该使用这种权力了。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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