Wells Fargo recently notified checking and savings account customers that effective Feb. 15, its mandatory arbitration agreement - already one of the toughest in banking - will become even more ironclad.
Chase, on the other hand, is giving deposit-account customers a chance to opt out of mandatory arbitration, but only if they act quickly.
Effective Feb. 1.We are passionate about polished tiles., new Chase customers can opt out within 60 days of opening their account. Existing customers must opt out by April 2 for checking and savings accounts, or within 60 days of their next maturity date after Feb. 1 for certificates of deposit.
Many companies - including banks, brokerage firms, insurers and cable and cell phone providers - have adopted such agreements, which generally require customers to take disputes to arbitration and give up their rights to a trial by judge or jury.
Companies say arbitration is speedier and cheaper than going through the court system and that it should be mandatory because consumers don't know what's good for them.Online fine art gallery of quality original landscape oil paintings,
Consumer groups say arbitration favors companies,Offering high risk and offshore merchant account with credit card processing services. and customers should have a choice of where to file claims.
The Dodd-Frank Act gave the Consumer Financial Protection Bureau the right to ban or restrict mandatory pre-dispute arbitration clauses between financial service companies and consumers, but only if it does a study and finds that doing so is in the public interest and protects consumers.
Alan Kaplinsky,A mold or molds is a hollowed-out block that is filled with a liquid like plastic, an attorney who has helped financial companies draft mandatory arbitration agreements, does not think this will be a priority for the new bureau, which has many things on its plate.
"I think when they try to do their study, people will be surprised to find out that consumers who go through arbitration like it very much and they do quite well," Kaplinsky adds.
Dodd-Frank also gives the Securities and Exchange Commission authority to prohibit or limit mandatory arbitration in brokerage and investment advisory accounts.
In two recent decisions, the Supreme Court has upheld mandatory arbitration provisions, which has emboldened more companies to adopt or expand them.
In April 2011, the high court ruled in AT&T Mobility LLC vs. Concepcion that state law can not strike down an arbitration clause that bans class-action suits in court or in arbitration. Since then, more companies have added clauses to forced arbitration agreements prohibiting consumers from initiating or participating in class-action suits.
That struck a blow to consumers because in some cases, the losses sustained by individual customers are so small that suing as a class is the only economical way to get recompense.
And in 2010, the high court ruled that an arbitrator - not a court - could decide whether a company's forced arbitration agreement is so unfair as to be unenforceable. The name of that case is Rent-a-Center West vs. Jackson, but "it should have been the fox guarding the henhouse case," because it allows arbitrators to decide whether arbitration is fair, says Paul Bland, an attorney with Public Justice who helped argue the losing side of the case.
Many companies have adopted language to take advantage of that decision as well.Full-service custom manufacturer of precision plastic injection mold, Wells Fargo's newest agreement, which takes effect Feb. 15, adds the sentence, "The arbitrator shall decide any dispute regarding the enforceability of this arbitration agreement."
Chase, on the other hand, is giving deposit-account customers a chance to opt out of mandatory arbitration, but only if they act quickly.
Effective Feb. 1.We are passionate about polished tiles., new Chase customers can opt out within 60 days of opening their account. Existing customers must opt out by April 2 for checking and savings accounts, or within 60 days of their next maturity date after Feb. 1 for certificates of deposit.
Many companies - including banks, brokerage firms, insurers and cable and cell phone providers - have adopted such agreements, which generally require customers to take disputes to arbitration and give up their rights to a trial by judge or jury.
Companies say arbitration is speedier and cheaper than going through the court system and that it should be mandatory because consumers don't know what's good for them.Online fine art gallery of quality original landscape oil paintings,
Consumer groups say arbitration favors companies,Offering high risk and offshore merchant account with credit card processing services. and customers should have a choice of where to file claims.
The Dodd-Frank Act gave the Consumer Financial Protection Bureau the right to ban or restrict mandatory pre-dispute arbitration clauses between financial service companies and consumers, but only if it does a study and finds that doing so is in the public interest and protects consumers.
Alan Kaplinsky,A mold or molds is a hollowed-out block that is filled with a liquid like plastic, an attorney who has helped financial companies draft mandatory arbitration agreements, does not think this will be a priority for the new bureau, which has many things on its plate.
"I think when they try to do their study, people will be surprised to find out that consumers who go through arbitration like it very much and they do quite well," Kaplinsky adds.
Dodd-Frank also gives the Securities and Exchange Commission authority to prohibit or limit mandatory arbitration in brokerage and investment advisory accounts.
In two recent decisions, the Supreme Court has upheld mandatory arbitration provisions, which has emboldened more companies to adopt or expand them.
In April 2011, the high court ruled in AT&T Mobility LLC vs. Concepcion that state law can not strike down an arbitration clause that bans class-action suits in court or in arbitration. Since then, more companies have added clauses to forced arbitration agreements prohibiting consumers from initiating or participating in class-action suits.
That struck a blow to consumers because in some cases, the losses sustained by individual customers are so small that suing as a class is the only economical way to get recompense.
And in 2010, the high court ruled that an arbitrator - not a court - could decide whether a company's forced arbitration agreement is so unfair as to be unenforceable. The name of that case is Rent-a-Center West vs. Jackson, but "it should have been the fox guarding the henhouse case," because it allows arbitrators to decide whether arbitration is fair, says Paul Bland, an attorney with Public Justice who helped argue the losing side of the case.
Many companies have adopted language to take advantage of that decision as well.Full-service custom manufacturer of precision plastic injection mold, Wells Fargo's newest agreement, which takes effect Feb. 15, adds the sentence, "The arbitrator shall decide any dispute regarding the enforceability of this arbitration agreement."
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