Bank of America Drops Arbitration Regulations
Posted on August 24, 2009 - Filed Under Business
Advocates for consumers have long stated that arbitration gives favor to the businesses and the companies rather than, or at the expense of the consumer. Arbitration is a legal process that prevents the customer or the consumer from joining in any kind of class action lawsuit. Instead this requires them, in order to receive services, to agree to contracts that bind them to arbitration should and disputes occur that need settled. An Orange county law firm can answer questions regarding this process.
For most people their time is not worth it to enter into arbitration in order to settle disputes, disputes that are more practically attended to in a court of law. Recently, the Bank of America changed their policies regarding arbitration, which has shocked many people in the business world. This is the first major banking institution to take measures such as these. No longer are unhappy customers required to participate in arbitrating over complaints or concerns, and the lawyers representing the Bank of America are concerned that as a result, they will be facing a large number of lawsuits in the future. However, they still have regulations regarding consumers joining together in class action suits.
For the time being one is on their own when it comes to suing the financial institution. The consequence may be that lawyers will simply not see the worth in taking on a single client, as the payout would not be worth it, as opposed to combined grievances under one joint suit of many customers. Critics state that will doing away with the restraints on arbitration is one step, it still bans customers from coming together for a lawsuit. And while some cases have been known to be the result of the abuse of the system, many times for customers with very little or no money, banding together is their only option for justice. Individual lawsuits are expensive. A spokeswoman for the Bank of America, stated that they just did what they believed would be best for their customers.
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