CFPB bans resolution platform Ejudicate from arbitrating certain disputes

Yesterday, the CFPB announced its has banned private dispute resolution platform Ejudicate from arbitrating disputes about consumer financial products after the company misled student borrowers about its neutrality and initiated sham arbitration proceedings. Ejudicate initiated those proceedings for the company Prehired, which was permanently shut down in 2023 by the CFPB and several state attorneys general for its illegal lending practices. Ejudicate acted as a service provider to Prehired by providing these sham arbitration services. The CFPB found that Ejudicate treated borrowers unfairly and was not truthful about its role while hiding that its financial interests were aligned with Prehired.