WASHINGTON, D.C. -

Back just before Thanksgiving, the Consumer Financial Protection Bureau made a special page on its website where individuals could submit complaints about the auto financing process while the agency reiterated its warnings about signing arbitration agreements, cautioning consumers how they might “waive other rights, such as your ability to appeal a decision or to join a class action lawsuit.”

CFPB director Richard Cordray repeated many of his issues with arbitration agreements during a recent appearance before the American Constitution Society as part of its Access to Justice Series. Cordray told the gathering in prepared remarks that “arbitration clauses, as they are used today both in the field of consumer finance and more generally, often have been deliberately designed to block Americans from effective means of vindicating their rights.”

Cordray continued to paint arbitration clauses in a negative way.

“Some of the broader ramifications are surprising and even breathtaking in their scope. But now both the Congress and the courts are beginning to turn away from the extreme philosophy that says a take-it-or-leave-it provision buried deep inside a form contract can nullify an individual citizen’s ability to vindicate rights conferred on them by federal and state law,” he said.

Cordray referenced a study the CPFB commissioned and released to Congress last spring when the bureau attempted to show how much consumers misunderstood arbitration agreements.

“Importantly, our study showed that arbitration clauses restrict consumers’ relief in disputes with financial service providers because companies are using them to block class proceedings in any forum — whether court or arbitration,” Cordray told the American Constitution Society.

“This affects consumers’ access to justice because group proceedings are often the only practical way to seek relief for relatively small claims. Class actions also create a mechanism to bring about much-needed changes in business practices,” he continued.

“By inserting an arbitration clause into their contracts, companies can sidestep the legal system, avoid big refunds, and continue to pursue profitable practices that may violate the law and harm consumers,” Cordray went on to say.

So how does the CFPB want to rectify the problems alleged in its reports stemming from arbitration agreements? Cordray maintained the bureau’s stance, noting the CFPB could have pursued actions that would have banned these agreements altogether. But the director acknowledged the CFPB is not taking that course at this time.

“While the proposals we are considering would not impose a total ban, we are concerned that consumer harm could arise if arbitrations are conducted in an unfair manner,” Cordray said.

“So we have also been considering whether to require companies to send to the bureau all initial claims and awards in consumer financial arbitration disputes,” he continued.

“By gathering this data, over time we will be able to refine our evaluation of how such proceedings may affect consumer protection, if at all,” Cordray added.