Minnesota stares down an arbitration giant -- and the giant blinks

Lori Swanson is my hero. Swanson is the first female attorney general in the history of Minnesota, and she has set a very high bar, which I hope her colleagues in other states -- and at the Securities and Exchange Commission -- will follow. But I'm an admirer for a different reason: Swanson had the courage to take on the National Arbitration Forum, one of the largest arbitration administrators in the U.S.

The NAF processed hundreds of thousands of consumer debt claims brought mainly by collectors. Consumers with credit disputes had no choice in the matter; they had to sign a "mandatory arbitration clause" designating the Forum the sole arbitrator of all conflicts with their creditors. The NAF conducted these arbitrations much like an impartial court system.