Tuesday night, as many Americans were preparing to go to bed, an evenly divided Senate voted to give broad lawsuit immunity to credit card companies, auto lenders, credit reporting companies like Equifax, and many other financial firms. The 50-50 tie in the Senate was broken by Vice President Mike Pence (R), and the House approved the lawsuit immunity measure. President Trump is expected to sign it.

The resolution passed by the Senate overrides a rule created by the Consumer Financial Protection Bureau (CFPB), which prevents many financial firms from engaging in two abusive practices. The rule prohibited much of the financial industry from using “forced arbitration” agreements — a common tactic where a company refuses to do business with consumers who will not sign away their right to sue the company in a real court.

Consumers who sign away their right to sue must resolve any disputes with the company in a privatized arbitration system that favors corporate parties.

Additionally, the CFPB rule prohibited credit card companies and many other financial firms from requiring consumers to sign away their right to bring class action lawsuits, a form of litigation that ensures that companies that charge certain illegal fees to consumers face a consequence for their actions.


The vote is a major victory for the banking industry. Every Senate Democrat voted to preserve the CFPB rule, as did Republican Sens. Lindsey Graham (R-SC) and John Kennedy (R-LA). All other Republicans voted to reverse the CFPB rule.

Tuesday evening’s vote also effectively strips the CFPB of much of its authority to rein in abusive arbitration clauses. Under the Congressional Review Act, CFPB cannot issue a rule “in substantially the same form” to one that is approved by Congress.

It’s worth noting that the 50 senators who supported the CFPB rule represent well over 30 million more people than the 50 senators who voted to rescind it. But, in the Devil’s arithmetic that governs the United States Senate, the will of the people plays only a minor role in determining who controls the Senate.