Country's Largest Credit Card Arbitration Company Exits Business

Facing both civil and criminal complaints, the National Arbitration Forum alerted consumer agencies and court officials that it would cease handling credit card dispute negotiations on behalf of the banking industry. The Minnesota Attorney General's office had uncovered links between the NAF, credit card companies, and debt collection firms that raised doubts about the Forum's ability to act in a fair and impartial manner. Forum officials told reporters that the company chose to refocus its efforts on settling Internet domain ownership disputes instead of the more contentious field of credit card negotiations.

Banking industry analysts note that the departure of NAF from the consumer arbitration business does not impact the millions of American cardholders still subject to their banks' dispute resolution policies. Arbitration allows private parties to settle business disputes under the direction of a third party. Under optimal conditions, third party arbitrators use experience from former careers as judges, lawyers, and trusted negotiators to prevent debt disputes from clogging local court dockets.