National Arbitration Forum Settles AG Suit; Exits Consumer Credit Card Business

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According to an eye-opening BusinessWeek article, Minnesota Attorney General Lori Swanson announced that the National Arbitration Forum (NAF) the same company she recently filed suit against, has agreed to stop deciding consumer arbitration cases!

In an explosive suit filed on July 14, 2009, Swanson alleged that the nation's largest provider of consumer debt collection arbitration services - (the company responsible for arbitrating most credit card and debt collection consumer disputes) is not in fact a disinterested party. The suit claims that NAF is actually owned by one of the corporations that also owns one of the country's major debt collection enterprises.

This latest announcement by the Minnesota AG Swanson reporting that NAF will pull out of consumer arbitration cases of any sort -can only be seen as a massive win for consumers!

As reported, under the terms reached NAF will stop accepting consumer arbitration cases this week. And this includes arbitration cases over disputed credit card debt as well as new business. The only arbitration cases NAF will now be involved with is cases involving internet domain disputes.

In an interview with BusinessWeek, AG Swanson says has decided to also send a letter to the American Arbitration Association,  a NAF competitor, asking them too to remove themselves from this credit arbitration arena saying "I am asking the AAA to show some leadership"

Will this explosive suit by AG Swanson resulting in NAF exiting the consumer credit/debt arbitration arena bring about more lawsuits?  And is this the beginning of the end of forced binding arbitration?

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I hope so, but more likely they will just shill up another "disinterested" party to act on their behalf.

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