A key Obama administration official who is still in office argued Tuesday that consumers should be able to sue banks as a group, and should be freed from financial contracts that prevent them from doing so.
"[M]any contracts for products like credit cards and bank accounts have mandatory arbitration clauses that prevent consumers from joining group lawsuits, forcing them to go it alone," wrote Consumer Financial Protection Bureau Director Richard Cordray wrote in a New York Times op-ed.
"For example, a group lawsuit against Wells Fargo for secretly opening phony bank accounts was blocked by arbitration clauses that pushed individual consumers into closed-door proceedings," he wrote.
Cordray wrote that his agency wrote a rule that would stop banks and other companies from putting that language in contracts people sign. But he said the House has passed legislation to block the rule.
He rejected GOP arguments that these lawsuits would overly hinder banks, and said they would help people recover "illegal fees" that banks charge, which he said adds up to "millions in ill-gotten gains."
"Not only do group lawsuits help consumers recover money they otherwise would forfeit, but they also protect many more consumers by halting and deterring harmful behavior," he wrote. "For example, when banks reordered bank debits to charge more overdraft fees, consumers sued and recovered $1 billion. Most banks have since stopped the practice."
Trump has refused to fire Cordray despite the broad opposition he faces from Republicans and ongoing calls for him to be removed.