1

CONSUMER FINANCIAL PROTECTION BUREAU 

INFORMATION COLLECTION REQUEST – SUPPORTING STATEMENT A 

 

TELEPHONE SURVEY EXPLORING CONSUMER AWARENESS OF AND 

PERCEPTIONS REGARDING DISPUTE RESOLUTION PROVISIONS IN 

CREDIT CARD AGREEMENTS 

 

(OMB CONTROL NUMBER: 3170-XXXX) 

The Consumer Financial Protection Bureau (the “CFPB”) seeks approval from the 

Office of Management and Budget (“OMB”) to conduct a national telephone survey 

of 1,000 credit card holders as part of its study of mandatory pre-dispute arbitration 

agreements, which is required under Section 1028(a) of the Dodd-Frank Wall Street 

Reform and Consumer Protection Act, Public Law No. 111-203, Title XIV (the “Dodd 

Frank Act”). 

The survey will explore (a) the role of dispute resolution provisions in consumer 

card acquisition decisions and (b) consumers’ default assumptions (meaning 

consumers’ awareness, understanding, or knowledge without supplementation from 

external sources) regarding their dispute resolution rights vis-à-vis their credit card 

issuers, including their awareness of their ability, where applicable, to opt-out of 

mandatory pre-dispute arbitration agreements.1 The survey will not gather data 

regarding respondents’ post-fact satisfaction with arbitration or litigation 

proceedings, given the difficulty in finding consumers that have had personal 

experience with both forums.

 

A. JUSTIFICATION 

1. Circumstances Necessitating Collection of Information

The CFPB seeks approval from OMB to conduct a national telephone survey of

1,000 credit card holders2 exploring consumer awareness of and perceptions 

regarding dispute resolution provisions in credit card agreements. The study will be

conducted in English and Spanish and include both residential landlines and 

cellphones.3 Participation will be voluntary.

 1 Part B of this Supporting Statement provides a more detailed discussion of the survey’s key 

estimates, including the required precision. Similarly, Appendix B describes how each proposed 

survey question relates to the key survey estimates. 

2 The survey will focus on general purpose “bank” credit cards (including co-branded cards) and 

exclude proprietary credit cards.

3 Bilingual surveys and the use of both landlines and cellphones are intended to mitigate potential 

biases due to non-response and noncoverage of the sampling frame. 
2

The survey will help the CFPB meet its obligations under Section 1028(a) of the 

Dodd Frank Act to conduct a study of, and provide a report to Congress concerning, 

the use of agreements providing for arbitration of any future dispute between 

entities offering or providing certain consumer financial products or services

(“covered persons”), on the one hand, and consumers, on the other hand, in

connection with the offering or providing of consumer financial products or services.

The CFPB is the sole proposed potential user, but data from the survey will be 

publicly available in at least aggregate form. The CFPB is contemplating release of 

survey microdata, after taking appropriate disclosure protections, such as collapsing

response cells and not returning specific variables (such as the identity of 

respondents’ credit card providers).

Although the CFPB’s overall study of mandatory arbitration provisions will extend 

to multiple product markets, the proposed telephone consumer survey will be 

limited to credit cards. This is because credit cards offer strong penetration amongst 

consumers across the nation. (In 2009, the U.S. Census estimated that 160 million 

Americans would own credit cards by 2012.) Also, limiting the study to credit cards 

allows the CFPB to verify the accuracy of consumers’ default assumptions regarding 

their dispute resolution rights, by consulting the agreements of the entities 

identified by the consumers as their credit cards’ issuing banks.

The CFPB proposes that the survey sample will be selected through random-digit 

dialing of residential and cellular telephones, rather than an Internet-based survey. 

Certain of the survey’s primary estimates relate to consumers’ awareness of their 

contract rights with their credit card issuers. Unlike an Internet-based or mailed 

survey, a telephone call requires real-time interaction, which minimizes the 

possibility that respondents will supplement their knowledge before responding to 

survey questions by searching the Internet or reviewing their credit card 

agreements. 

The key estimates to be derived from the survey are:

• The percentage of credit card users that compare multiple credit cards (e.g., 

comparison shop) before acquiring a credit card;

• The percentage of credit card users that volunteer in response to an openended query that dispute resolution provisions4 were a consideration when

acquiring a credit card;

 4 This submission uses the term “dispute resolution provisions” to reference contractual provisions 

that address formal dispute resolution options. This would include agreements providing for 

arbitration of future disputes, often referred to as “mandatory pre-dispute arbitration agreements.” 
3

• The percentage of credit card users that state that dispute resolution 

provisions were a consideration when acquiring a credit card after specifically 

being queried about dispute resolution provisions and seven other factors;

• Relative tiers of importance of the credit card features that consumers 

identify as being relevant to their card acquisition decisions, drawn from the 

aforementioned open and closed-set queries;

• The percentage of credit card users that affirmatively volunteer in response 

to an open-ended query that they would consider bringing formal claims 

against their credit card issuers (i.e., filing a complaint in small claims court; 

consulting a lawyer regarding state or federal litigation; or filing a notice of 

arbitration) after exhausting informal dispute resolution options;

• Consumers’ default assumptions regarding their dispute resolution rights 

(i.e., do they believe they have a right to have claims adjudicated by a judge 

or jury when they may, in fact, be subject to a mandatory arbitration 

provision);

• The accuracy of consumers’ default assumptions regarding their dispute 

resolution rights;

• Consumers’ awareness of mandatory predispute arbitration as a means of 

resolving disputes.5 

The CFPB proposes using probability sampling to obtain approximately 1,000 

respondents aged 18 or older. Based on an expected response rate of 15-20%, the 

CFPB proposes screening roughly 7,000 individuals with credit cards in order to 

reach the 1,000 respondent sample. The sample will be selected to provide broad

geographic coverage of the United States. The observable demographic 

characteristics and information about measured differences across respondents will 

be used to construct sample weights so that estimates from the survey are 

representative of the overall U.S. population. The CFPB anticipates an estimation 

error of +/- 3.1% for most of the survey questions.

The CFPB has retained ICF International to assist with administration of the 

telephone survey, should OMB approve this proposal. As described herein, ICF 

 

The term does not encompass informal dispute resolution options, such as customer service 

telephone help lines or covered persons’ internal complaint-reporting functions. 

5 Part B of this Supporting Statement provides a more detailed discussion of the survey’s key 

estimates, including the required precision. Similarly, Appendix B describes how each proposed 

survey question relates to the key survey estimates. 
4

International assisted with this submission to OMB, including conducting consumer 

focus group testing and user testing reflected in OMB Control No. 3170-024.

This proposal reflects extensive revisions compiling learnings from the engagement 

of ICF International; review of nearly two-dozen written comments; two 

consultation rounds with interested parties representing both financial service 

organizations and consumer groups; focus group testing with two sets of consumer 

panels; and extensive user testing.

2. Use of the Information

The results of the survey will ultimately be communicated to the public as part of 

the CFPB’s Dodd Frank Section 1028(a) report to Congress, to ensure an 

equivalent, timely release. 

In that regard, Section 1028(a) of the Dodd Frank Act states that the CFPB “shall 

conduct a study of, and shall provide a report to Congress concerning, the use of 

agreements providing for arbitration of any future dispute between covered persons 

and consumers in connection with the offering or providing of consumer financial 

products or services.”

Section 1028(b) establishes further CFPB authority, stating that the Bureau “by 

regulation, may prohibit or impose conditions or limitations on the use of an 

agreement between a covered person and a consumer for a consumer financial 

product or service providing for arbitration of any future dispute between the 

parties, if the Bureau finds that such a prohibition or imposition of conditions or 

limitations is in the public interest and for the protection of consumers.” The section 

specifies that “[t]he findings in such rule shall be consistent with the study 

conducted under subsection (a).”

The CFPB’s 1028(a) report will, among other topics, provide a detailed discussion of 

the survey’s findings and methods. The CFPB will endeavor to provide survey 

documentation that will allow the public to understand how to properly analyze 

data from the survey, as well as evaluate and potentially recreate each key 

estimate. The report will also provide an evaluation of the quality of the data and 

areas for potential improvement. 

3. Use of Information Technology

ICF International will collect data electronically through the use of computerassisted telephone interviewing software. Such software will help reduce errors by:

• Providing uniform question sequencing;
5

• Automatically skipping questions, where appropriate, based on prior answers 

to questions; 

• Randomizing how certain questions, or groups of questions, are presented;

• Ensuring that some questions cannot be skipped; and

• Rejecting invalid responses or data entries.

Additionally, the contractor may collect data on the length of interviews, measures 

of the effectiveness of specific interviewers, and unit and item non-response rates. 

This type of information can be used to improve the data collection process.

4. Efforts to Identify Duplication 

The proposed consumer survey will not duplicate empirical research that the CFPB 

has identified to date. In that regard, the CFPB has been unable to identify prior 

empirical studies exploring the role of dispute resolution provisions in consumer 

credit card acquisition decisions or consumer default assumptions regarding their 

dispute resolution rights vis-à-vis their credit card issuers. 

Regarding card acquisition, the closest comparison the CFPB has identified is a

September 2011 report by Mercator Advisory Group, which explored consumer 

credit card acquisition decisions, but did not report on dispute resolution provisions 

as a potential factor.6 Mercator fielded an Internet-based consumer survey of 

approximately 1,000 adults. Mercator’s survey asked consumers to identify “One 

Main Reason for Selecting Credit Card at Last Application.” “Dispute resolution 

provisions/rights” was not included in the fourteen reported measures. “Some Other 

Reason,” which would likely subsume such concerns, was the third-largest category 

for applications made within the last year, trailing only rewards and “no annual 

fee” (“Some Other Reason” tied for second-largest category for selection criteria 

relating to applications prior than a year old). Mercator’s survey also asked 

consumers to identify the “Most Important Reason for Selecting Credit Card To Use 

The Most.” Again, “dispute resolution provisions/rights” was not included in the 

twelve reported measures. But again, “Some Other Reason” was one of the largest 

categories – fourth for applications within the year, third for applications from prior 

years. 

Theoretically, empirical work regarding consumer awareness of arbitration 

provisions could inform the proposed survey’s exploration of how those provisions 

factor into consumers’ credit card acquisition decisions, as well as consumers’ 

default assumptions. The arbitration-awareness research identified to date by the 

CFPB, however, does not extend to the issues the CFPB seeks to estimate. The 

majority of prior awareness research focuses on whether consumers read contracts 

 6 U.S. Credit Cardholders: Waiting for a Rebound, Mercator Advisory Group (Sept. 2011) 

(CustomerMonitor Survey Series, Insight summary Report Vol. 3, Report 1).
6

generally. Such research largely has not specifically focused on consumer awareness 

of arbitration provisions, which are frequently formatted differently than the rest of 

the consumer contract. In that regard, courts that have enforced arbitration 

agreements frequently observe that arbitration provisions may be subject to 

different formatting (e.g., typeface, font size, bold, or underlining) than other 

contractual provisions.7

The awareness studies that do focus on arbitration provisions generally do not focus 

on consumer financial products and services, much less credit cards.8 Further,

many of these studies were too limited in size or geographic diversity to draw 

conclusions about the country as a whole.9 For example:

• In 2009, the Employee Rights Advocacy Institute for Law & Policy and Public 

Citizen conducted a nationwide survey of 800 voters, which explored the 

respondents’ awareness of the existence of arbitration provisions in their 

employment agreements and certain agreements for goods and services.10 In 

particular, the study polled respondents about their expectations regarding 

 7 See, e.g., Murea v. Pulte Group, Inc., 2014-Ohio-398 (Ct. App. Ohio Feb. 6, 2014) (“The arbitration 

provisions in both agreements were clearly marked in capital letters. The arbitration clause in the 

purchase agreement as conspicuously written in bold print, and the signature line of the agreement 

expressly warned Murea to ‘make sure that all provisions are read and understood before signing.’”). 

Forest Hill Nursing Ctr., Inc. v. McFarlan, 995 So. 2d 775, 785 (Miss. Ct. App. 2008) (noting bold, all 

capital letters); Lorene Park, Be loud, clear, and fair in arbitration provisions or be prepared to 

litigate, Released Aug. 7, 2012 available at

http://www.employmentlawdaily.com/index.php/2012/08/07/be-loud-clear-and-fair-in-arbitrationprovisions-or-be-prepared-to-litigate (advising employers feature arbitration agreements in a 

separate document, or at least in its own paragraph set off with spacing, and to “[u]se a 12-point font 

or larger; and use a bold, underlined, and capitalized heading that includes the words “Arbitration 

Agreement.”) (emphasis in original). 

8 See, e.g., Yannis Bakos et al., Does Anyone Read the Fine Print? Testing a Law and Economics 

Approach to Standard Form Contracts 1-26, N.Y.U. Law & Econ. Research Paper Series, Working 

Paper No. 09-04, 2009 (studying on-line browsing habits of 45,091 households relating to online 

software merchants). 

9 See, e.g., Amy Schmitz, Access to Consumer Remedies in the Squeaky Wheel System, 39 

Pepperdine L. Rev. 279-366 (2012) (describing panel of 306 Colorado consumers); Shmuel I. Becher & 

Esther Unger-Aviram, The Law of Standard Form Contracts: Misguided Intuitions and Suggestions 

for Reconstruction, 8 DePaul Bus. & Com. L.J. 199 (2010) (surveying 147 consumers); Debra 

Pogrund Stark & Jessica M. Choplin, A License to Deceive: Enforcing Contractual Myths Despite 

Consumer Realities, 5 N.Y.U. J.L. & Bus. 617, 619-23 (2000) (surveying 91 students fulfilling a 

course requirement; 106 approached in a public location; and 101 law students). 

10 See, e.g., National Study of Public Attitudes on Forced Arbitration: Findings from a Survey of 800 

Likely 2010 Voters Nationwide. The Employee Rights Advocacy Institute for Law & Policy and 

Public Citizen. Released 04/09 (research funded by the Public Welfare Foundation) available at 

http://www.citizen.org/documents/lake-research-national-study-of-public-attitudes-forcedarbitration.pdf. 
7

their ability to sue their employers in court as well as whether the 

respondents recalled executing mandatory arbitration provisions in terms of 

employment or terms of agreements for goods and services. The study, 

however, did not discuss the use of arbitration provisions in connection with 

the offering or providing of consumer financial products or services.

• In contrast, the Pew Charitable Trusts focused on checking accounts in its 

2012 survey of 603 consumers.11 The study, however, did not describe data or 

survey questions relating to the extent of consumer awareness of arbitration 

provisions.12 It similarly did not discuss how consumers weighed dispute 

resolution provisions when evaluating financial products. Instead, the study 

focused on (a) the prevalence of arbitration provisions in the account 

agreements of the largest 100 retail banks and credit unions by deposit 

volume and (b) consumers’ preferences after they were presented with 

possible features of arbitration provisions or contrasting statements about 

arbitration provisions.

• In 2003, the Institute for Advanced Dispute Resolution surveyed 1,036 

Americans, seeking information about consumer awareness and preferences 

regarding arbitration provisions. The survey, however, focused on 

respondents’ perspectives regarding voluntary arbitration proceedings, rather 

than arbitration proceedings that were required under pre-dispute contracts. 

And it has not been updated in ten years. There is significant controversy 

regarding whether the Institute for Advanced Dispute Resolution was or was 

not an arbitration advocacy organization.13 

• And in 2008, the Center for Responsible Lending commissioned a study from 

Macro International as part of its regular CARAVAN® survey. The survey 

was conducted among a national probability sample of 1,007 adults, 

concluding that 68% of consumers that financed cars from dealerships were 

unaware if their contract had a “forced arbitration” clause after the clause 

 11 Banking on Arbitration: Big Banks, Consumers, and Checking Account Dispute Resolution. The 

Pew Charitable Trusts. Released 11/26/12 available at 

http://www.pewstates.org/uploadedFiles/PCS_Assets/2012/Pew_arbitration_report.pdf. 

12 The Pew study references a lack of consumer awareness regarding dispute resolution provisions, 

but stops short of discussing the data underlying any such inquiry. (“Pew found that many 

consumers are unaware that account agreements restrict their options if they have a dispute with 

their financial institution.”) It similarly does not detail particular questions relating to such an 

inquiry. 

13 Roper ASW, 2003 Legal Dispute Study: Institute for Advanced Dispute Resolution (2003) cited in

Public Citizen, The Arbitration Debate Trap, at 20-22 (2008) (discussing controversy) available at

http://www.citizen.org/documents/ArbitrationDebateTrap(Final).pdf. Also, the study focused on 

arbitration provisions generally, as opposed to the financial sector. 
8

was described to them. The study, however, did not list the questions used in 

the survey. Further, while the survey featured over a thousand respondents, 

only 27% of the survey population used a loan at a dealership to purchase a 

car or truck. Accordingly, the sample size for the arbitration awareness 

questions was only 268 respondents.14

While there is a significant volume of other arbitration-focused empirical work, it 

does not duplicate the proposed survey’s estimates: how dispute resolution rights 

factor into consumers’ credit card acquisition decisions and consumers’ default 

assumptions regarding their ability to sue the credit card issuer in a court of law. 

For example, other empirical studies, including the CFPB’s own release of 

preliminary results relating to its overall study of arbitration provisions, have 

studied the prevalence of arbitration provisions in various types of markets.15 Other 

 14 Joshua M. Frank, Center for Responsible Lending, Stacked Deck: A Statistical Analysis of Forced 

Arbitration (2009) available at http://www.responsiblelending.org/credit-cards/researchanalysis/stacked_deck.pdf.

Further, the Center for Responsible Lending could not verify whether consumers’ recollections about 

the presence of arbitration agreements was correct. They found that 17% of respondents said that 

there was never an arbitration clause in their auto loan agreement. The Center for Responsible 

Lending relied on “[c]onversations with experts familiar with these contracts suggest that many of 

the people who thought there was no arbitration in their contract likely were mistaken.” In so doing, 

the Center for Responsible Lending assumes that the full 17% was mistaken (an assumption that 

was used in certain regression analyses). In contrast, the CFPB will be able to look to relevant bank 

customer agreements, available independent of the respondents, to verify the accuracy of consumers’ 

perceptions.

15 See, e.g., Consumer Financial Protection Bureau, Arbitration Study: Preliminary Results (Dec. 

2013) available at: http://files.consumerfinance.gov/f/201312_cfpb_arbitration-study-preliminaryresults.pdf; Checks and Balances 2014 Update. The Pew Charitable Trusts. Released 04/09/2014 

available at http://www.pewstates.org/uploadedFiles/PCS/ContentLevel_Pages/Reports/2014/Checks-and-Balances-Report-2014.pdf.; Christopher R. Drahozal & Peter 

B. Rutledge, “Contract and Choice,” 2013 B.Y.U. L. Rev. 1 (2013) (studying the prevalence of 

arbitration agreements in credit card agreements); Michael L. Rustad, An Empirical Study of 

Predispute Mandatory Arbitration Clauses in Social Media Terms of Service Agreements, 34 U. Ark. 

Little Rock L. Rev. 643 (2012) available at http://ualr.edu/lawreview/files/2013/01/Rustad-Normal.pdf

(studying the prevalence of arbitration agreements in social media service agreements and privacy 

terms); Christopher R. Drahozal & Quentin R. Wittrock, Is There a Flight from Arbitration?, 37 

Hofstra L. Rev. 71, 90-94 (2008) (studying the prevalence of arbitration agreements franchise 

agreements); Theodore Eisenberg, Geoffrey P. Miller & Emily Sherwin, Arbitration’s Summer 

Soldiers: An Empirical Study of Arbitration Clauses in Consumer and Nonconsumer Contracts

(2008), available at http://lsr.nellco.org/nyu_lewp/136; Florencia Marotta-Wurgler, “Unfair” Dispute

Resolution Clauses: Much Ado About Nothing?, in Boilerplate: The Foundation of Market Contracts 

45, 47-48 (Omri Ben-Shahar ed., 2007) (studying the prevalence of arbitration agreements in enduser software license agreements); Linda J. Demaine & Deborah R. Hensler, “Volunteering” to 

Arbitration Through Predispute Arbitration Clauses: The Average Consumer Experience, 67 Law & 

Contemp. Probs. 55, 73-74 (2004) (studying the prevalence of arbitration agreements in consumer 

contracts, generally); Elizabeth Rolph, Erik Moller & John E. Rolph, Arbitration Agreements in 

Health Care: Myths and Reality, 60 Law & Contemp. Probs. 153, 171 (1997) (studying the 

prevalence of arbitration agreements relating to California physicians and hospitals). 
9

studies have explored arbitration outcomes, measuring consumer satisfaction after 

a dispute16 or the likelihood that consumers will achieve success in an arbitration 

proceeding, taking into consideration both win rates and award sizes.17

The CFPB will continue to monitor empirical research and related work by Federal 

regulatory agencies and other researchers to ensure that the CFPB’s research 

techniques reflect the current knowledge and best practices.18

 

16 Arbitration: Simpler, Cheaper, and Faster than Litigation, Harris Interactive Survey, conducted 

for U.S. Chamber Institute for Legal Reform (Apr. 2005), available at http: 

http://www.adrforum.com/rcontrol/documents/researchstudiesandstatistics/2005harrispoll.pdf (19% 

of survey respondents had entered arbitration proceedings because they were required by contract; 

the other 81% voluntarily opted into the arbitration proceedings); Outcomes in Arbitration: An 

Empirical Study of Consumer Lending Cases, Ernst & Young (2004) (studying outcomes in 226 by 

the National Arbitration Forum in lending-related consumer-initiated cases). 

Other studies have looked to consumer satisfaction in specific types of arbitration proceedings. See, 

e.g., Gary Tidwell, Kevin Foster & Michael Hummel, Party Evaluation of Arbitrators: An Analysis of 

Data Collected from NASD Regulation Arbitrations 3 (1999) cited in Michael Perino, Report to the 

Securities Exchange Commission Regarding Arbitrator Conflict Disclosure Requirements in NASD 

and NYSE Securities Arbitrations (2002), available at http://www.sec.gov/pdf/arbconflict.pdf 

(describing substantial level of satisfaction amongst respondents, but cautioning that findings were 

limited by a response rate of just 10-20%, which may reflect selection bias problems). 

17 See, e.g., Alexander J.S. Colvin, An Empirical Study of Employment Arbitration: Case Outcomes 

and Processes, 8 J. Empirical Legal Stud. 1 (2011); Christopher R. Drahozal & Samantha Zyontz, 

Creditor Claims in Arbitration and in Court, 7 Hastings Bus. L.J.77 (2011) (comparing the outcomes 

of debt collection cases brought by creditors in arbitration as compared to outcomes of debt collection 

cases brought in court); Christopher R. Drahozal & Samantha Zyontz, An Empirical Study of AAA 

Consumer Arbitration, 25 Ohio St. J. on Disp. Resol. 843 (2010) (summarizing prior empirical work 

and discussing the results of a study of 301 consumer arbitrations administered by the American 

Arbitration Association in 2007); Peter B. Rutledge, Whither Arbitration?, 6 Geo. J.L. & Pub. Pol’y 

549 (2008) (summarizing prior empirical work); Alexander J.S. Colvin, Empirical Research on 

Employment Arbitration: Clarity Amidst the Sound and Fury?, 11 Employee Rts. & Employment 

Pol’y J. 405, 418 (2007); Mark Fellows, The Same Result as in Court, More Efficiently: Comparing 

Arbitration and Court Litigation Outcomes, 14 Metropolitan Corp. Counsel 32 (2006) (study 

conducted by legal counsel for National Arbitration Forum, regarding 2003-2004 National 

Arbitration Forum consumer arbitration awards from California) available at

http://www.metrocorpcounsel.com/articles/6988/same-result-court-more-efficiently-comparingarbitration-and-court-litigation-outcomes; Lisa B. Bingham & Shimon Sarraf, Employment 

Arbitration Before and After the Due Process Protocol for Mediation and Arbitration of Statutory 

Disputes Arising Out of Employment: Preliminary Evidence that Self-Regulation Makes a 

Difference, in Alternative Dispute Resolution in the Employment Arena: Proceedings of the New 

York University 53rd Annual Conference on Labor 303, 320-28 (Samuel Estreicher & David Sherwyn 

eds. 2004); Michael Delikat & Morris Kleiner, Comparing Litigation and Arbitration of Employment 

Disputes: Do Claimants Better Vindicate Their Rights in Litigation?, 6 A.B.A. Litig. Sec. Conflict 

Mgmt. 1, 10 (2003); Theodore Eisenberg & Elizabeth Hill, Arbitration and Litigation of Employment 

Claims: An Empirical Comparison, 58 Disp. Resol. J. 44, 48 (Nov. 2003-Jan. 2004); Elizabeth Hill, 

Due Process at Low Cost: An Empirical Study of Employment Arbitration Under the Auspices of the 

American Arbitration Association, 18 Ohio St. J. Disp. Resol. 777, 806 (2003). 
10

5. Efforts to Minimize Burdens on Small Entities 

The data collection will not burden small entities because the survey will only 

collect information from individuals.19

6. Consequences of Less Frequent Collection and Obstacles to Burden 

Reduction 

Each surveyed individual will only participate once. 

If the survey was not implemented, the CFPB would be limited in its ability to 

provide an analysis of how dispute resolution provisions are used in connection with 

the offering or providing of financial products or services to consumers. For 

example, to the extent that CFPB intends to study the consumer experience with 

arbitration, first-order questions would include whether consumers even know 

whether they are in an arbitration environment and, if so, whether they made a 

conscious decision to be subject to arbitration requirements. 

7. Circumstances Requiring Special Information Collection

No special circumstances require the collection to be conducted in a manner 

inconsistent with the guidelines set forth in 5 C.F.R. 1320.5(d)(2).

8. Consultation with Individuals Outside of the Agency on Availability of Data, 

Frequency of Data, Frequency of Collection, Clarity of Instructions and 

Forms, and Data Elements

On April 27, 2012, the CFPB made a “Request for Information Regarding Scope, 

Methods, and Data Sources for Conducting Study of Pre-Dispute Arbitration 

Agreements.” (77 F.R. 82.) The CFPB received over sixty comment letters in 

response. 

Certain commentators suggested that the CFPB focus on consumer satisfaction 

after resolving a dispute in arbitration. The CFPB, however, does not propose that 

 18 The Information Collection Request Search Tool maintained by the OMB’s Office of Information 

and Regulatory Affairs returned only one document in response to an April 11, 2014 search for 

“arbitration survey.” Available at https://www.reginfo.gov. That document, OMB Control No. 3170-

024, was a reference to the CFPB’s submission to OMB regarding the use of focus groups and 

usability testing relating to this proposed telephone survey.

19 Given that the finances of small businesses are often intertwined with their owners, the survey 

instrument will instruct respondents to exclude cards used primarily for business purposes when 

responding to survey questions about credit card use. 
11

the survey include such an exploration. Such research would ideally be conducted 

with consumers that had personal experience with both litigation and arbitration, 

but as many commentators highlighted, this would be a very small sample set.20 

(As the U.S. Chamber of Commerce later noted in a comment letter to OMB relating 

to this proposal, “[v]anishingly few respondents will have sufficient background 

information to assess the comparative merits of arbitration and litigation, because 

it is highly unlikely that more than a very few individual respondents will have had 

the experience of pursuing similar disputes in each forum. . . . .And the number of 

respondents with experience concerning both arbitration and litigation is likely to 

be extremely small – indeed , it is likely to be zero.”) (emphasis in original).21

Commentators also made a number of other suggestions, including that the CFPB 

assess consumer awareness and understanding regarding dispute resolution

provisions.22 By probing consumers’ default assumptions regarding their dispute 

resolution rights, the proposed survey would provide data relevant to consumer 

awareness and understanding.

On June 7, 2013, the CFPB published a Federal Register Notice which notified the 

public of the CFPB’s intent to collect this survey, and provided a 60-day comment 

period (Vol. 78, No. 110, Page 34352). The Federal Register Notice also included a 

draft proposed survey (the “Initial Questionnaire”), which included more questions

than the current proposal, exploring additional estimates than the version included 

in this submission such as estimates of consumer valuation and perception of 

transaction costs relating to dispute resolution alternatives. The draft was included 

to help facilitate discussion and frame the ultimate survey, but made clear that the 

 20 From 2010 to 2012, there were approximately 344 arbitration filings a year with the American 

Arbitration Association regarding credit card issues. Consumer Financial Protection Bureau, 

Arbitration Study: Preliminary Results (Dec. 2013) available at: 

http://files.consumerfinance.gov/f/201312_cfpb_arbitration-study-preliminary-results.pdf. Not all of 

the filings proceeded to adjudication by an arbitrator. 

21 (U.S. Chamber of Commerce, Aug. 6, 2013, pp. 10, 16.)

22 Professor Alexander J.S. Colvin, ILR School, Cornell University (also suggesting that the CFPB 

assess satisfaction); June 22, 2012 letter from American Financial Services Association (among 

numerous suggestions, suggesting that the CFPB examine how well-informed consumers are 

regarding the benefits of arbitration programs); June 23, 2012 letter from Jill I. Gross, Pace 

University School of Law (“For the consumer-level study, researchers should survey consumers’ 

perceptions of fairness of arbitration clauses of sample companies as well as perceptions of fairness 

of the arbitration process with those companies . . . . “); June 22, 2012 letter from MFY Legal 

Services (among other suggestions, “[t]he CFPB should survey consumer knowledge about 

arbitration clauses and how arbitration works. Do consumers understand what it means to sign an 

arbitration clause?”); June 23, 2012 letter from National Association of Consumer Advocates and The 

National Consumer Law Center (“The CFPB should also study why consumers may be passing on 

available arbitration options. For example, the CFPB should examine how well-informed consumers 

are as to the benefits of a fairly designed and administered arbitration program.”).
12

CFPB expected to revise the questionnaire “based on the experience and knowledge 

of the contractor, comments from the public notice process, cognitive testing, and 

pretesting of the survey questions.” Further, in accordance with 5 CFR 

1320.5(a)(1)(iv), the Bureau has published a notice in the Federal Register allowing 

the public 30 days to comment on the submission of this information collection 

request to the Office of Management and Budget.

Consultation with Individuals Outside of the Agency, July 2013

On July 8, midway through the 60-day comment period, the CFPB hosted two 

roundtables seeking consultation with individuals outside of the agency regarding 

the proposed survey. Meeting participants included leading business federations, 

banking trade associations, and non-profit consumer advocacy organizations.

In each session, the CFPB described the estimates it sought to obtain from the 

proposed survey and responded to questions from the participants. Among other 

suggestions, one participant suggested that the CFPB include a “closed ended” 

question to probe consumer knowledge of arbitration provisions, rather than an 

open-ended question (which is reflected in the revised proposed script in Appendix 

A). Many commentators raised concerns about the length and complexity of the 

proposed survey; questions seeking answers to hypothetical scenarios were a 

particular focus of these stated concerns. Certain commentators also questioned 

whether consumers had sufficient knowledge of dispute resolution provisions to 

either (a) estimate the amount of money they would spend to obtain the dispute 

resolution rights that they preferred; or (b) estimate how much they would need to 

be harmed before initiating an arbitration or litigation or participate in a class 

action litigation. As discussed below, the questions relating to those issues –

Questions 8 and 11 in the Initial Questionnaire – have been stricken from the 

proposed survey, which has been shortened and otherwise simplified.

Comments Received in Response to 60-Day Notice

The CFPB received approximately twenty-two responses regarding its 60-Day 

Notice.

Commentators included:

• The American Bankers Association (together with Consumer Banker 

Association and the Financial Services Roundtable, the “ABA 

Commentators”); 

• Americans for Financial Reform; Center for Justice and Democracy; 

Consumer Action; Consumer Federation of America; Consumers for Auto 

Reliability and Safety; Citizen Works; D.C. Consumer Rights Coalition; 

Homeowners Against Deficient Dwellings; National Association of Consumer 
13

Advocates; National Consumer Law Center (on behalf of its low income 

clients); National Consumers League; Public Citizen; U.S. PIRG; and 

Workplace Fairness;

• the American Financial Services Association (“AFSA”);

• the Credit Union National Association;

• Thomas Durkin;

• Jennifer Lee;

• Alessandro Machi (three comments);

• the Michigan Credit Union League and Affiliates;

• the Missouri Credit Union Association; 

• National Association of Consumer Advocates and the National Consumer 

Law Center, on behalf of its low income clients; 

• Kenneth Sheehan;

• Donna Shestowsky and Nancy Welsh (two sets of joint comments); 

• Public Justice; and

• The U.S. Chamber of Commerce.

Certain commentators (e.g., the ABA Commentators, AFSA, and the U.S. Chamber 

of Commerce) expressed that the Bureau should not proceed with the survey. Many 

of their concerns, however, related to concerns about the Bureau’s overall study of 

mandatory arbitration studies (the proposed survey is just one of many different 

parts of the overall study). 

The ABA Commentators, for example, stated that “the Bureau’s information 

collection should be focused on a comprehensive review of the disputes that may 

arise about consumer financial services and how they can be resolved.” (ABA 

Commentators, Aug. 6, 2013). The United States Chamber of Commerce similarly 

asserted that the Bureau should study issues outside of the survey, such as the 

nature of consumer claims, outcomes in arbitration versus litigation, class 

proceedings (which they also framed as “trade-offs”), cost burdens and accessibility

of arbitration and litigation, and post-dispute arbitration. (U.S. Chamber of 

Commerce, Aug. 6, 2013, pp. 3-4). 

The CFPB has made clear that it is addressing several, if not all, of these other 

lines of inquiry in its overall study of mandatory arbitration provisions. In that 

regard, the Bureau released preliminary results relating to its study of mandatory 

arbitration provisions in December 2013.23 The Bureau’s preliminary results 

included, among other things, a typology of consumer disputes filed with the 

primary arbitration services provider for consumer financial products, the American 

Arbitration Association, relating to consumer credit card, checking account, and 

 23 Consumer Financial Protection Bureau, Arbitration Study: Preliminary Results (Dec. 2013) 

available at: http://files.consumerfinance.gov/f/201312_cfpb_arbitration-study-preliminaryresults.pdf.
14

payday loan issues. The Bureau reported several data points, including the number 

of filings relating to each type of product, the legal claims that they cover, claim 

amounts, initial fee assessments, whether the parties were represented by counsel, 

and the demographic distributions of the zip codes relating to consumers in those 

arbitrations. The Bureau explained that it intends to address the “back-end” of 

formal disputes in subsequent work: what happens to claims, how long proceedings 

take to resolve, and at what cost. The Bureau highlighted that its future work will 

include a review of filings in certain federal courts and, where possible, selected 

state courts. It also explained that it intends to study consumer class actions, 

including attempting to assess consumer benefits and transaction costs in consumer 

class actions involving consumer financial services. And, the Bureau stated that it 

will attempt to analyze whether consumer financial class actions exert improper 

pressure on defendants to settle meritless claims. Accordingly, many of the concerns 

raised in commentators’ responses relating to the proposed survey have already 

been addressed by the release of the preliminary results or will be addressed with 

the future work described therein.

Other commentators asked that the Bureau be mindful of increasing regulatory 

burdens to credit unions. For example, the Credit Union National Association 

expressed that it had no “formal objections to a survey by the CFPB,” but asked that 

the Bureau be sensitive to the burden to credit unions posed by the inquiry. (Credit 

Union National Association, Aug. 2, 2013.) Likewise, the Missouri Credit Union 

Association stated that it “recommends that the CFPB seek to determine 

consumers’ understanding of dispute resolution, particularly arbitration, while at 

the same time requesting that the CFPB be cognizant of tremendous regulatory 

burdens that credit unions are already facing.” (Missouri Credit Union Association, 

Aug. 6, 2013.) C.f., (Michigan Credit Union League & Affiliates, Aug. 6, 2013) (“As 

an industry, credit unions continue to feel the burden of significant compliance costs 

for new regulations that are in response to actions they were not a party to.”) The 

CFPB is cognizant of the concerns raised by credit union commentators and will be 

mindful of the differences they have raised when analyzing and presenting data. 

For example, the Bureau highlighted the distinction between credit unions and 

other types of credit card issuers in its release of the preliminary results of the 

arbitration study, noting that only nine of the 275 agreements it studied relating to 

credit cards issued by credit unions contained arbitration provisions – just 3.3% 

compared to approximately 58% of large bank issuers.24

As referenced above, certain commentators raised concerns about Questions 8 and 

11 on the Initial Questionnaire, which explored (a) how much consumers would 

need to be harmed before initiating an arbitration or litigation or participating in a 

class action litigation; or (b) the amount of money they would spend to obtain the 

 24 Consumer Financial Protection Bureau, Arbitration Study: Preliminary Results (Dec. 2013) 

available at: http://files.consumerfinance.gov/f/201312_cfpb_arbitration-study-preliminaryresults.pdf.
15

dispute resolution rights that they preferred. The U.S. Chamber of Commerce 

highlighted what it described as the primary tension inherent in the estimates. 

Without providing a description of arbitration and a description of litigation, 

“consumers are unlikely to provide anything but an un-, or at a minimum, underinformed guess.” On the other hand, “[a]ny such description would to a very 

significant degree influence consumers’ answers (because it would be their sole 

source of information) and therefore produce wholly unreliable results.” (U.S. 

Chamber of Commerce, Aug. 6, 2013 p.18.) The ABA Commentators similarly 

expressed that consumers would lack sufficient information to make meaningful 

assessments or comparisons about arbitration or litigation unless they had been 

involved in either. (ABA Commentators, Aug. 6, 2013) (focusing on former Question 

11, in particular).25 The Michigan Credit Union League & Affiliates, as well as 

individual commentator Thomas Durkin, similarly raised concerns about Questions 

8 and 11 in the Initial Questionnaire, which they describe as asking consumers to 

answer a hypothetical question. As mentioned above, those questions – former 

Questions 8 and 11 – have since been stricken from the proposed survey.

A few commentators argued that the results of the proposed survey’s questions 

regarding card acquisition and default assumptions were predictable. None of these 

commentators, however, identified specific empirical work that had not already 

been considered by the Bureau that would potentially duplicate the proposed case 

work. Instead, the commentators cite to general studies of contract terms. Had 

these commentators raised specific studies that would be duplicative of the specific 

inquiries regarding consumer credit card acquisition decisions and default 

assumptions, the CFPB would have closely reviewed the studies in the course of the 

other works referenced herein. But, after a 60-day comment period and two sets of 

in-person meetings with many of the commentators, the CFPB has not identified 

any such prior work.

In particular, the Bureau submits that general studies regarding consumer contract 

terms may not apply to arbitration provisions, which are frequently formatted

specifically to draw consumers’ attention to them. As described above, and in the 

Bureau’s original OMB submission, arbitration agreements are frequently 

highlighted in headers at the top of consumer agreements. And, in the body of the 

consumer agreements, they are often set aside in their own paragraphs and 

emphasized with larger font sizes and text that is bolded, underlined, or both. At 

the same time, arbitration agreements describe complex issues that may be difficult 

for consumers to understand. In that regard, the Bureau’s December 2013 

 25 The U.S. Chamber of Commerce also agreed that “[v]anishingly few respondents will have 

sufficient background information to assess the comparative merits of arbitration and litigation, 

because it is highly unlikely that more than a very few individual respondents will have had the 

experience of pursuing similar disputes in each forum.” (U.S. Chamber of Commerce, Aug. 6, 2013, p. 

10, 16) (“And the number of respondents with experience concerning both arbitration and litigation 

is likely to be extremely small – indeed, it is likely to be zero.”) (emphasis in original).
16

preliminary results found that arbitration clauses are generally more complex and 

written at a higher grade level than other provisions in the same contracts, using 

the Flesch readability score (a widely used standard in plain language analysis).

Accordingly, arbitration agreements have relatively unique characteristics that may

impact consumers’ ability to identify them, on the one hand, but also to understand 

them, on the other.

Many commentators raised concerns about the length and complexity of the 

proposed survey. The revised survey is significantly streamlined, compared to the 

original proposal. While responsive to commentator suggestions, streamlining of the 

original proposal was included in the design of the survey. The proposed survey was 

intentionally broad and released without the contributions of the survey consultants 

retained by the CFPB. Focusing solely on question text read to consumers (not 

including demographic questions, which were not included in the Initial 

Questionnaire), the Initial Questionnaire had a Flesch readability score of 

approximately 68 and an eighth grade level, respectively.26 Focusing similarly on 

non-demographic question text read to consumers, the new draft has about onethird fewer words, with approximately a 78 readability score and a sixth grade 

level.27

Consultation with Individuals Outside of the Agency, March 2014

On March 11 and 12, 2014, the CFPB met individuals outside of the agency in three 

additional meetings regarding the proposed survey. Meeting participants again 

included leading business federations, banking trade associations, and non-profit 

consumer advocacy organizations.

The CFPB discussed a revised approach to the Initial Questionnaire, informed by 

two focus group panels held by ICF International on February 18. The CFPB 

explained that it would be proceeding with user-testing of a revised survey 

instrument shortly after the meetings and would incorporate feedback from the 

consultation in the version of the survey that would be tested. 

Commentators again discussed proposed survey questions concerning consumers’ 

perceptions of the relative transaction costs of various types of dispute resolution. 

Many commentators raised concerns about the hypothetical nature of such

questions. As discussed above, questions exploring relative transaction costs have 

 26 The Flesch readability score ranges from 0.0 to 100.0, with a higher number indicating greater 

readability. With respect to grade level, on the other hand, a lower level indicates greater 

readability. 

27 These comments are referenced as examples only and should not be construed as an exhaustive 

list of the comments considered by the CFPB in revising the proposed survey. The CFPB considered 

many other specific comments, as well as other factors such as focus group testing and user testing, 

when revising the proposed survey.
17

since been stricken from the proposed survey. Other commentators raised questions 

about whether the results of the survey were predictable. As discussed above, no 

commentator has identified a study or other empirical work that indicates that the 

survey’s exploration of dispute resolution provisions in consumer card acquisition 

decisions or default assumptions regarding dispute resolution are, in fact, 

predictable – particularly in light of the special formatting often used for dispute 

resolution provisions or the CFPB’s recent data indicating the differences in 

readability of the provisions, compared to the rest of consumers’ credit card 

agreements. 

9. Payment or Gifts to Respondents 

No payment or gifts will be offered to participants in the proposed survey. 

10. Assurance of Confidentiality 

In the survey’s introduction, respondents will be told about the study’s purpose, the 

authority under which the data are being collected, that cooperation is voluntary, 

and that direct identifying information will not be provided to the CFPB or to any 

other party.28 Respondents will be informed by both the pre-notification letter and 

the introduction to the survey that their response will be kept private except where 

required by law.

At the completion of the data collection, each respondent’s telephone number will be 

separated from the answers to the survey questionnaire. At the completion of the 

project, the ICF International will transfer or destroy all direct identifying

information according to security procedures and a data management plan to be 

approved by the CFPB.29

 28 The survey’s OMB control number will be listed in pre-notification letters (Appendix C), as well as 

a statement that the CFPB cannot conduct an information request until it displays a valid OMB 

control number.

Consumers will be told that the average interview length is expected to be ten minutes, and that 

respondents should let interviewers know if they feel that this projection was inaccurate.

29 The data management plan will provide, at least, that the CFPB’s internal archived portion of the 

survey documentation contain the information set forth in Guideline 7.3.2 of the OMB Standards 

and Guidelines for Statistical Surveys (Sept. 2006), where appropriate.
18

11. Justification for Sensitive Questions 

Respondents will be asked to identify the financial institution that issued their

most recently-obtained credit card. The CFPB can consult documentation relating 

to that financial institution, to verify and report on the accuracy of consumers’ 

default assumptions regarding their dispute resolution rights.

Consumers will be asked about their prior experiences with arbitration, litigation, 

class litigation, or small claims court. This information is gathered solely to help 

mitigate potential sampling bias issues, as opposed to primary reporting that would 

make estimates regarding consumers’ experiences in these forums. The actual 

disputes will not be identified. This information will be collected, so that any 

correlation between past experiences and consumer responses can be identified and, 

if appropriate, controlled for. 

Respondents will also be asked basic demographic information regarding education, 

race/ethnicity, age, income, and gender. This information will be used to gauge and 

potentially weight the sample so that the survey reflects representative 

demographic groups in the U.S. population.30

This information collection will not include questions about sexual behavior and 

attitudes, religious beliefs, disability, social security numbers, or other matters 

generally considered private. 

 30 Mercator similarly weighted its credit card survey results against “the demographic structure of 

U.S. population in the statistical analysis based on geographic location, gender, income, household 

size, and age structure.” U.S. Credit Cardholders: Waiting for a Rebound, Mercator Advisory Group 

(Sept. 2011) (Customer Monitor Survey Series, Insight summary Report Vol. 3, Report 1). Mercator 

noted that the lowest economic strata of the U.S. population may be under-represented. “On the 

other hand, the respondent base is certainly representative of the broad economic profile of 

consumers in the U.S. who have banking relationships.”
19

12. Estimated Burden of Information Collection

No. of 

Respondents 

Annual 

Frequency 

per Response 

Total 

Annual 

Responses 

Hours per 

Response Total Hours 

Telephone 

Survey 1,000 1 1,000 0.17031 170

13. Estimated Total Annual Cost Burden to Respondents or Recordkeepers 

There are no annualized capital or start-up costs for the respondents to participate 

in the survey.

14. Estimated Cost to the Federal Government 

There will be no annualized capital/start-up costs for the government to receive the 

survey information. The testing is funded with non-appropriated funds. It is 

anticipated that the contract to carry out the study will cost $186,500.

The Blanket Purchase Agreement, under which the survey will be conducted, was 

awarded through a competitive bidding process.

15. Program Changes or Adjustments 

Because this is a new collection of information, all the burden is new and, as such, 

considered to be a program change for the purpose of OMB’s Paperwork Reduction 

Act inventory.

16. Plans for Editing, Statistical Analysis, and Publication 

The CFPB anticipates that the survey will be completed within eight to twelve

weeks of OMB approval. The contractor will develop the initial analysis and 

summary of the study findings. 

Skip patterns will be embedded in the computer assisted telephone interviewing 

software, which should strongly mitigate erroneous data due to respondents being 

asked inappropriate questions or questions that were inadvertently skipped. The 

computer assisted telephone interviewing software will also contribute to data 

quality by not allowing responses that fall outside of logical bounds. Further, the 

CFPB and ICF International will review the data for logistical inconsistencies 

 31 The estimate for average burden per response was arrived at by testing the proposed survey 

questions with multiple CFPB personnel that are unaffiliated with the proposed study. 
20

before tabulation and, where appropriate, edit the collected data to mitigate or 

correct detectible errors. Missing data that cannot be resolved through editing may 

be imputed using accepted statistical techniques such as multiple imputation 

through chained equations. 

Other question combinations may not result in clearly erroneous answers, but will 

still require that specific combinations of answers be noted. For example, some 

questions are designed to provide rough estimates of respondents’ familiarity with 

arbitration or litigation (e.g., “What does it mean to participate in arbitration?”). If a 

respondent is unable to list any features of arbitration (or that arbitration 

proceedings have binding results), their lack of background knowledge can be noted 

when analyzing the consumer’s later responses. 

Where appropriate, the contractor will convert answers provided in response to 

open-ended questions to standardized codes, which will allow the CFPB and future 

users of the data to better analyze the information. For example, Question 4 asks 

consumers to list the most important reasons for choosing the credit card they use 

most frequently. The survey itself will not provide potential answers. But 

consumers’ open-ended responses will be converted to common codes, where 

possible, so that all responses relating to low interest rates, for example, can be 

grouped together; whereas other answers relating to specific rewards features 

would be grouped into a different code. Some consumer answers, however, may not 

be appropriate for grouping into codes. In such case, the individuals’ actual 

responses will be noted or summarized. (Question 5, in contrast, includes a closedended set of potential responses.)

The report will provide tabulations at the national level. Once the data is tabulated, 

it will be presented along with an executive summary and detailed findings about 

the role that dispute resolution provisions play in consumer card acquisition 

priorities and consumers’ default assumptions regarding dispute resolution rights. 

The report will also provide an evaluation of the quality of the data, as well as areas 

of potential improvement. The CFPB does not currently contemplate conducting 

additional surveys on this subject, but the information may be useful for data 

interpretation or designers of similar studies. 

17. Display of Expiration Date 

The CFPB plans to display the OMB number and expiration date for OMB approval 

on the pre-notification letter. Survey telephone administrators will also be provided 

this information. 
21

18. Exceptions to the Certification Requirement 

The Bureau certifies the this collection of information is consistent with the 

requirements of 5 CFR 1320.9, and the related provisions of 5 CFR 1320.8(b)(3) and 

is not seeking an exemption to these certification requirements.