Here. Excerpt:
Big Lie No. 1: Bank lobbyists claim that people recover more in arbitration than in class actions: $32 per person in class actions versus $5,400 per person in arbitration, citing the CFPB’s study.
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The very few people who take the time and expense to pursue an individual arbitration — only 16 people a year on average in the entire country got those $5,400 “average” arbitration awards — had quite large claims, averaging $27,000. The CFPB’s study found that, nationwide, only 25 people file arbitrations each year seeking less than $1,000.
But several million people each year get relief in class actions, which are an efficient way of resolving smaller claims by many people. For example, Kaylee Heffelfinger, one of the lead plaintiffs in the class action against Wells Fargo, alleged $210 in unauthorized fees. Her claim did not make sense to pursue by herself.
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Big Lie No. 2: Class actions only benefit the attorneys.
The CFPB studied 419 consumer financial class actions and found $2.7 billion in relief for consumers, with only 18 percent of that going to attorneys. That is, $2.2 billion went to consumers.
