AAJ Supports the Department of Defense in New Proposed Rule that Protects Service Members from Forced Arbitration | The American Association For Justice
For Immediate Release: December 1, 2014

AAJ Supports the Department of Defense in New Proposed Rule that Protects Service Members from Forced Arbitration

Sarah Jones

Washington, DC— The American Association for Justice (AAJ) submitted comments to the Department of Defense (DoD) in support of its proposed rule to strengthen the Military Lending Act (MLA), which prohibits financial institutions from cheating service members through predatory loans and excessively high interest rates, and bans the use of forced arbitration in disputes governed by the MLA.

Many financial institutions have been able to evade the MLA and other laws intended to protect the financial security of military families through the ubiquitous use of forced arbitration clauses. By burying these clauses in the fine print, cheated service members are unable to hold the financial institution accountable in court and are instead funneled into a rigged, secretive arbitration system designed by the lenders who broke the law.

AAJ's comments encourage the DoD to enact the proposed rule, which would extend the MLA's ban on forced arbitration to consumer credit products and services, including credit cards and deposit advance loans that target members of our military, as well as close other loop holes that have allowed MLA violations to go unpunished. 

"AAJ strongly supports the DoD’s proposed rule to extend the MLA’s scope and ensure more comprehensive rights and protections for our military families in expanding the prohibition of waivers and forced arbitration clauses," said AAJ President Lisa Blue in her comments to the DoD. “Prohibiting the practice of forcing service members to surrender fundamental Constitutional and statutory rights through the use of pre-dispute forced arbitration clauses is now more critical than ever, given the exponential and expansive use of these clauses by financial institutions in contracts with service members."


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