Thursday, February 7, 2008

Excessive Legal Disclosures

When I opened my WaMu account, I think I spent more time than the average consumer does by taking an hour to skim through all the account and legal disclosures. Apparently I didn't spend enough time since I missed the part about getting excess activity fees. But this got me thinking. Why do we have to read 80 pages of text to open a savings/checking account? Why do we have to read through 1000 pages to get a mortgage? Why do businesses require us to sign off on massive amounts of legal jargon all the time?

Advocates will claim that they have to protect themselves from lawsuits so they cover every possible position. They (usually neo-conservatives) are always quick to blame 'frivolous lawsuits' (FLs), but we had huge legal disclosures before the FLs label became commonplace and they still claim that we have FLs now, so obviously that argument is out. The fact of the matter is, most lawsuits aren't 'frivolous.' If they are, don't you think a judge with 7 years of education and many more years of legal training under his or her belt is going to see right through it and toss it right out the window? I mean come on, give judges some credit. Supposedly if all these FLs are still being committed, excessive legal disclosure are then pointless, right? But I digress.

You know what the real reason is? It is a blanket excuse for corporations to screw you. "Read your disclosures!" They know god damn well that the average consumer does not have enough time or the desire to slog through hundreds of pages of arcane legal jargon. And with more text, it becomes easier to stuff in hidden fees and charges, and more opportunity to take away your legal rights as a consumer. Most contracts offered by corporations are completely one-sided in their favor and attach clauses that make it harder for you, the consumer, to take any action against if there is an injustice. Some clauses are more subtle - many people don't know that clauses such as binding arbitration overwhelmingly favor corporations in the proceedings, as found by the group Public Citizen.

I think that legal disclosures should be a maximum of 5 pages in plain English where fees and expenses clearly highlighted and clauses that take away consumer's rights should be illegal. Call your congressmen and senators and tell them to support the Arbitration Fairness Act of 2007. There is a legislative directory for your representatives at People Over Profits

No comments: