WASHINGTON — Consumer Financial Protection Bureau Director Richard Cordray urged President Trump Monday to veto a congressional measure invalidating the bureau's arbitration rule.
The Senate narrowly approved using the Congressional Review Act to overturn the regulation, with Vice President Mike Pence casting the tiebreaking vote. The CFPB rule would have required banks to remove arbitration clauses that prevent consumers from filing class-action lawsuits.
“The resolution is now before you to decide whether it will stand or fall,” Cordray wrote of the rule in a letter to Trump.
The letter comes as Republicans in Congress and the administration continue to criticize CFPB policies under Cordray, and amid speculation that GOP leaders have discussed how to remove him. Cordray himself is said to be considering resigning to run for governor of Ohio.
Cordray noted that the two men "have never met or spoken" and that "many have told me I am wasting my time writing this letter." Yet he insisted that the rule would help consumers correct wrongs through the legal process.
"This letter is not about charts or graphs or studies," Cordray wrote. "Instead, it is simply a personal appeal to you, asking you to uphold this rule."
The House passed similar legislation in July with a wider margin than in the Senate. Sens. Lindsey Graham, R-S.C., and John Kennedy, R-La., had defected from the rest of the caucus, leaving the Senate locked in a 50-50 tie.
Cordray told Trump, “I am aware that over the course of your long career in business you often found it necessary to go to court when you thought you were treated unfairly.” Cordray also pointed to the benefits of the regulation in protecting veterans, noting that the American Legion and the Military Coalition supported the rule.
"I think you really don't like to see American families, including veterans and service members, get cheated out of their hard-earned money and be left helpless to fight back," Cordray wrote. "I know that some have made elaborate arguments to pretend like that is not what is happening. But you are a smart man, and I think we both know what is really happening here."
Republicans have argued that the arbitration rule was a giveaway to trial lawyers who usually see the most financial benefit from class-action lawsuits and tend to donate to Democrats. But Democrats and Cordray say that the rule provided consumers an opportunity to fight large corporations when they are wronged.
“Most Americans cannot afford to do this on their own, so they have to band together,” wrote Cordray.
However, the White House has already endorsed the legislation to overturn the bureau’s rule.
“President Donald J. Trump applauds the Congress for passing” the resolution disapproving the rule, the White said in a statement after the Senate vote.
