A Banking Nightmare He Could Have Never Imagined
All James wanted was to fund his small business with a loan provided by a business partner. Once the loan was authorized, the money would show up in James’ bank account - which he could then use to pay bills.
That’s exactly what James had every reason to expect. Despite his bank statement not displaying the transfer, the bank manager repeatedly assured him the loan money had been deposited and even provided cashier’s checks for him to begin spending. He could not have known that the money wasn’t there.
Unbeknownst to James, his business partner had backed out of the deal at the last minute. Because neither the bank nor his business partner warned James of this, he continued writing checks. And those checks began bouncing – pushing him more and more overdrawn on his account.
James learned what happened too late, when the bank manager called to say there was an urgent problem. That’s when James discovered for the first time that the checks he was writing were based on bank funds that were never there.
The resulting financial mess was devastating. James now owed back everything he had borrowed and more. He was forced to close his business. He lost his house and even his car.
James should be allowed to hold the bank accountable for the mistake through our civil justice system – but he can’t. Because of a small clause in the fine print in his checking account application, James has become a victim of forced arbitration. Banks and a growing number of other corporations force arbitration on consumers to keep complaints out of court and push them before an “arbitrator” they’ve hand-picked and paid. It is an inherently biased process without justice.
James fought without success for six years to keep his case from being forced into arbitration. Now, with nothing he can do about it, James has watched his case drag on in arbitration for two years. He has yet to have a hearing on the merits of his case. Forcing arbitration on consumers like James isn’t justice. It’s a tool that powerful corporations use to evade responsibility.