PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

Restoring Regulatory Balance: President Trump Signs CRA Rescinding Costly CFPB Rule 

By at 1 November, 2017, 7:02 pm

NEWS

FOR IMMEDIATE RELEASE

Washington, D.C. – Today, President Donald Trump signed H.J. Res 111 into law, which corrects Consumer Financial Regulatory Bureau (CFPB) regulatory overreach by rescinding the intrusive anti-arbitration rule.  Small Business & Entrepreneurship Council (SBE Council) president & CEO Karen Kerrigan applauded President Trump’s action, as it will protect small financial entities from trial lawyers and excessive costs while serving to restore regulatory balance, which will improve access to capital for entrepreneurs and small businesses.

“Access to capital remains a challenge for many small business owners and entrepreneurs. Enabling a common sense regulatory and business environment for financial institutions and in the financial services industry will improve capital access, investment and encourage more innovation, competition and startups in this sector. The CFPB produced a bad rule through a bad process, which undermines capital access and the health of the industry. Small business owners and entrepreneurs are pleased President Trump signed H.J. Res. 111 into law, thus revoking the rule,” said Kerrigan.

According to the Office of the Comptroller of the Currency, the CFPB anti-arbitration rule would have driven the cost of credit 25 percent higher, thus impacting access to needed financing. In addition, the CFPB’s own “small entity compliance guide” on the anti-arbitration rule demonstrated the wide array of small businesses impacted by it.

“Given that arbitration serves both consumers and businesses well by reducing the time and costs involved in resolving disputes, this rulemaking was very peculiar.  Indeed, the flawed study used by the CFPB to justify the rule, their overall dismissive attitude regarding concerns brought to their attention, and their lack of accountability in general is the type of regulatory behavior that galls entrepreneurs and the public about the regulatory process in Washington. Small business owners see special-interest meddling and bias in government rulemakings in what is supposed to be a fair process. In this case their concerns are warranted, as it appears that the only real beneficiaries of the anti-arbitration rule are lawyers who undertake class action lawsuits. Small business owners thank President Trump, once again, for taking meaningful action on cutting red tape and costly regulation by signing H.R. Res. 111 into law,” Kerrigan added.

President Trump has signed 15 Congressional Review Act resolutions into law.  These actions, combined with meaningful executive orders to improve the regulatory environment and rid the economy of costly red tape and uncertainty, are key reasons why small business confidence continues to remain high, which is helping to fuel the strong GDP performance over the past two quarters, according to Kerrigan.

Related Content:
CFPB’s Pro-Trial Lawy0er, Anti-Small Business Rule Cries Out for Congressional Repeal
The CFPB: Reining in Dodd-Frank’s Regulatory Monster
SBE Council’s Letter to Majority Leader Mitch McConnell supporting H.J. Res. 111.

CONTACT:
K
aren Kerrigan, kkerrigan@sbecouncil.org
703-242-5840

Raymond Keating, Chief Economist, rkeating@sbecouncil.org

631-909-1122

SBE Council is a nonpartisan, nonprofit advocacy, research and education organization that works to protect small business and promote entrepreneurship. For nearly 25 years SBE Council has worked to successfully implement a range of policy and private sector initiatives to strengthen the ecosystem for startups and small business growth. To learn more, visit SBE Council’s website: www.sbecouncil.org. Follow on Twitter: @SBECouncil

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