Hidden in contracts for everything from a cell phone plan to bank accounts and home loans are clauses that bar customers from taking companies to court in a practice called forced arbitration. Opponents argue those policies are rigged and anti-consumer and new rules were put in place this year by the Consumer Protection Bureau rules to regulate the issue.
It’s been a low-profile issue, but it’s gained new traction in the wake of the Equifax hack that exposed more than 140 million customers’ private information to hackers. In the aftermath, the monitoring company began offering free credit monitoring to affected customers, but hidden within the terms of that agreement was an arbitration clause that prevents customers from suing the company.
It’s added fuel to a brewing battle in the Senate over a GOP-backed resolution that would undo the new rules put in place by the Consumer Protection Bureau. Those rules don’t altogether stop forced arbitration, but they allow for lawsuits in some specific cases.
It’s a national battle that has once again come to Alaska because it’s home to moderate Republican U.S. Sen. Lisa Murkowski. Democratic consumer watchdog group Allied Progress launched television ads on the issue this week.
The campaign also coincides with new polling on the issue.
A new poll conducted by AmericanViewpoint found ending forced arbitration was broadly popular with Alaskans. According to the poll results, more than two-thirds supported ending forced arbitration and 61 percent favored the Consumer Protection Bureau’s new rules. The poll was conducted with 400 registered voters between Aug. 14 and 16, well before Equifax made headlines. According to the cross tabs, the party affiliation of the respondents was within 2 percentage points of Alaska’s overall party affiliation.
Here’s the results and questions pollsters asked:
The pollster has a B rating from FiveThirtyEight with a rated bias that leans in favor of Republicans by 0.6 points.
More on forced arbitration
Alaska Public Interest Research Group chairman Steve Cleary wrote about the issue in a community perspective recently published in the Fairbanks Daily News-Miner. He explained that many practices have even targeted service members and has become an issue the Pentagon is involved with.
“One problem service members and veterans face is forced arbitration clauses buried in the fine print of bank accounts, auto loans and other contracts that strip them of their day in court when big banks and others violate the law. Instead, disputes are sent into a rigged, secretive process where the banks often choose the arbitrator,” he wrote, later adding, “The Pentagon, which opposes forced arbitration and class-action bans for service members, has found that financial abuses are a leading cause for service members to lose security clearances, resulting in lower unit preparedness.”