SEATTLE -- This week, the Consumer Financial Protection Bureau announced a rule that consumer groups say is a big win for Americans who want to settle corporate wrongdoing in court.
The rule bans companies from using forced-arbitration clauses in order to avoid lawsuits, meaning consumers can once again band together in class action suits. Members of Congress already are looking to dismantle the rule. But Larry Shannon, government affairs director at the Washington State Association for Justice, said the rule is necessary.
"This rule restores consumer protection,” Shannon said. “It ensures real accountability for these companies and it acts as a deterrent to keep them from engaging in this kind of behavior in the first place."
Shannon used the example of a cell phone company in Washington that was taking a $35 fee without explanation. A single consumer would have a hard time justifying paying thousands of dollars in legal fees to recoup the money. But a class action lawsuit would make the case more affordable.
Opponents of the rule say arbitration is a cheaper and faster way for consumers to get justice.
Shannon said forced arbitration clauses also keep cases out of court, making it harder to identify bad actors. A scandal at Wells Fargo involving the opening of fake accounts last year highlighted the need for this rule. In that case, consumers were blocked from suing the bank because of a forced arbitration clause in their contracts.
Shannon said nursing homes use these clauses in a more troubling way.
"You don't get into nursing homes unless you have signed away your right to hold the nursing home accountable for the treatment to your loved ones,” he explained. “And I think that's an outrage. And this rule addresses that as well."
Republican Sen. Tom Cotton of Arkansas said he has started drafting a resolution to rescind this new rule. Shannon said he hopes it stays in place, contending that forced arbitration has become a "license to steal" for the companies that use it.
"Who's Congress going to stand up for here?” he asked. "Are they going to stand up for consumer protections, for people in America, or are they going to go to bat for Wall Street and banks and financial institutions and big employers who abuse these clauses?”
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Lawmakers in Olympia this session moved to add more protections for consumers against predatory loans.
Washington state lawmakers passed Senate Bill 6025 unanimously in both chambers, closing a loophole companies were using to evade caps on the amount of interest charged on loans.
Sam Leonard, an attorney in Seattle, said tech companies providing financial services such as loans would charter out of state banks, especially in Utah, where lenders can charge unlimited interest rates.
"These fintech lenders a lot of times will charge 150, 200% interest on relatively small dollar loans, $3,000, $5,000 and the like," Leonard explained.
Washington state has a set of protections called the Consumer Loan Act to shield people from predatory loans. Leonard said capping interest rates at the federal level would help people across the country.
However, he emphasized the bill goes a long way to increase protections for Washingtonians.
"Not a lot of states at this time have passed similar legislation," Leonard pointed out. "Washington is out in front of the curve with regard to protecting low-income Washingtonians or other Washingtonians that might enter into these predatory loan products."
Leonard added the issue with predatory loans is they keep people in continuous debt cycles.
"Loan products like these essentially strip low-income individuals' ability to improve their economic situation," Leonard noted.
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While there's snow in the immediate forecast, the spring storm season has arrived in Minnesota and state officials said with complaints related to homeowner insurance claims on the rise, it is important to monitor changes in policies.
The Minnesota Commerce Department said complaints from policyholders, largely stemming from their claims being denied, have more than doubled since 2020.
Julia Dreier, deputy commissioner of insurance for the Minnesota Department of Commerce, said under a changing climate, the nation is seeing plenty of extreme weather events resulting in wind and hail damage, and insurance companies are adjusting to what's happening.
"Insurance costs are going to increase," Dreier pointed out. "We do want to make sure that Minnesotans are prepared."
As some carriers narrow what is covered or require higher deductibles, Dreier urged consumers to carefully review their policy when it is up for renewal, to avoid surprises when they have to file a claim. The department acknowledged changes can slip under the radar when consumers rely on paperless statements sent via email, or with busy schedules preventing them from reading all the fine print in documents they receive.
The department emphasized it is a complicated process in getting complaints resolved, noting some can be partially reversed in favor of the homeowner. Dreier noted they work closely with the industry to make sure a company's actions are within the letter of the law.
"One of our jobs is to make sure that insurance companies aren't doing something unethical when they're submitting their policy forms to us and their rates to us for review," Dreier added.
The department does have a new video on its YouTube channel, which offers more details on how to better prepare yourself ahead of any future claims, including knowing whether your policy offers flood protection and assessing the value of items in your home.
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Wisconsin has announced a big development in trying to establish more digital equity around the state.
Gov. Tony Evers and the Public Service Commission say Wisconsin's blueprint for digital equity has been accepted by the National Telecommunications and Information Administration.
That means the state is eligible for up to $30 million to implement its approach over the next five years.
Martha Cranley - state director for AARP Wisconsin - called it a robust plan, noting that older populations continue to face challenges in being connected to the digital world.
"We know that at least 15% of people 50-plus in Wisconsin are not connected," said Cranley, "either because the wires simply don't come to their house, or they don't have a device, or they don't know how to use it."
Cranley said the lack of connection is especially concerning in rural areas across northern Wisconsin, where aging communities have limited resources.
Stakeholders also note an infusion of new aid is helpful with the federal government's Affordable Connectivity Program - which provides discounts on monthly internet bills for eligible households - in danger of running out of money.
Cranley said the state's plan came together following extensive public outreach, in which her organization helped convey the need for improved internet access for those 50 and older.
"They certainly heard from older people about how important this is to connect to their doctor," said Cranley, "and to connect to government services, and frankly, find employment."
Overall, Evers says the plan's federal approval means more than 410,000 homes and businesses will be better positioned to be connected to new or improved high-speed internet service.
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