Bank of America no longer requires arbitration to settle disputes
Bank of America has changed its policy that required binding arbitration between its credit card holders and banking customers and the bank. Bank of America made the decision in reaction to customer complaints that arbitration favors banks rather than the individual customer.
According to Bank of America spokeswoman Shirley Norton, the new rule change is effective for new disputes beginning Aug. 20. She also said that the company believed that arbitration is fair, but it was clear that some customers felt that it wasn’t.
The new law will allow for lawsuits against the bank but the company hopes that by listening to customer complaints and making changes, they will be able to settle more disputes with customers directly.
The practice to require binding arbitration is a common banking practice to protect against potentially more costly lawsuits.