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October 6, 2017

Dissecting Lawsuit Over CFPB Arbitration Rule

SubPrime Auto Finance News

Reprinted with permission from SubPrime Auto Finance News

In an article published on October 6, 2017 in SubPrime Auto Finance News, Nelson Mullins attorney Craig Nazzaro, who is of counsel in the Firm’s Atlanta office, provided insight into a lawsuit filed on Sept. 29, 2017 by a number of banks and business organizations against the Consumer Financial Protection Bureau. The lawsuit aims to prevent the implementation of a new rule that would prohibit banks from using arbitration to settle consumers’ complaints against them. “I strongly agree that the arbitration rule as currently drafted by the CFPB will immediately cause harm to lenders through increased legal and compliance costs and will ultimately affect the end consumer through higher costs of borrowing and tighter credit markets that will limit access to credit for certain borrowers,” Nazzaro told the publication. Nazzaro cautioned against a partisan approach regarding the CFPB’s agenda. “….[T]hen the only thing that will be guaranteed is a never-ending cycle of uncertainty as to how the rules will be enforced,” Nazzaro said. “The only thing that is more expensive than overregulation is inconsistent regulation.”

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