The Justice Department announced that it has entered into an agreement with Lakeland Bank to settle the DOJ’s claims that Lakeland engaged in unlawful redlining in the Newark, New Jersey metropolitan area. The DOJ’s lawsuit against Lakeland, filed in a New Jersey federal district court, is part of the DOJ’s nationwide “Combating Redlining Initiative” launched in October 2021. … Continue Reading
Fair Lending
FHFA Announces Mortgage Servicer Requirements for Maintaining Fair Lending Data
By Ballard CFS Group on
Posted in Fair Lending, Regulatory and Enforcement
The FHFA announced that Fannie Mae and Freddie Mac will require mortgage servicers to maintain certain fair lending data elements, including the borrower’s age, race, ethnicity, gender, and preferred language. The fair lending data must be stored in a searchable format, and must transfer with servicing throughout the loan term.
On the topic, Freddie Mac issued Bulletin 2022-17, and Fannie Mae issued Servicing Guide Announcement SVC-2022-06.… Continue Reading
This week’s podcast episode: A close look at the Justice Department’s settlement with Meta (formerly Facebook) to resolve alleged Fair Housing Act violations arising from Meta’s targeted advertising system
By Barbara S. Mishkin on
After reviewing the developments leading up to the settlement, we examine the aspects of Facebook’s advertising delivery system that were alleged to be discriminatory. We then discuss the terms of the settlement, including the variance reduction system that Facebook must develop to address disparities for race, ethnicity and sex between advertisers’ targeted audiences and the group of Facebook users to whom Facebook’s personalization algorithms actually deliver the advertisements, how variances will be measured, the role of an independent third-party reviewer, and the timetable for implementation.… Continue Reading
GAO issues report on OCC fair lending oversight
By John L. Culhane, Jr. & Scott A. Coleman on
Posted in Fair Lending, OCC
In response to a request from three Democratic House members, the GAO recently issued a report on its review of fair lending oversight conducted by the Office of the Comptroller of the Currency. According to a Law360 report, the lawmakers had petitioned the GAO nearly two years ago to open an investigation into allegations that the OCC had quietly dropped several fair lending investigations during the Trump Administration. … Continue Reading
Justice Department announces settlement with Meta (formerly Facebook) to resolve alleged FHA violations arising from Meta’s targeted advertising system
The Department of Justice announced that it has entered into a settlement with Meta Platforms Inc., formerly known as Facebook Inc., to resolve allegations that Meta engaged in discriminatory advertising in violation of the Fair Housing Act (FHA). The proposed agreement was filed in a New York federal district court simultaneously with a complaint alleging that Facebook’s housing advertising system discriminated against Facebook users based on their race, color, religion, sex, disability, familial status, and national origin.… Continue Reading
2021 HMDA Data Released
By Richard J. Andreano, Jr. on
The Federal Financial Institutions Examination Council (FFIEC) recently announced the public availability of Home Mortgage Disclosure Act data for 2021. The CFPB also released a summary of the data. The data include information on 23.8 million home loan applications, with 21.1 million being identified as closed-end loan applications. A total of 15 million applications resulted in loan originations. … Continue Reading
Michigan’s November 2022 Ballot to Include Fair Lending Proposal Capping Payday Loan Interest Rates
By Elanor A. Mulhern on
Proponents of the Payday Loan Interest Rate Cap ballot initiative in Michigan met the June 1, 2022 deadline to appear on the November 2022 ballot in the state. If not picked up by the state legislature this summer, the proposal would ask voters to approve a state statute capping payday loan interest rates, that can currently reach over 370% APR, at no more than 36% APR.… Continue Reading
CFPB issues new circular on application of ECOA adverse action notice requirements to credit decisions using algorithms
By Michael Gordon & John L. Culhane, Jr. on
Under Director Chopra’s leadership, the CFPB has regularly been sounding alarms about the potential for discrimination arising from the use of so-called “black box” credit models that use algorithms or other artificial intelligence (AI) tools. Today, in the second of its recently-launched Consumer Financial Protection Circulars, the CFPB addresses ECOA adverse action notice requirements in connection with credit decisions based on algorithms.… Continue Reading
OCC, FDIC, and Federal Reserve propose amendments to CRA regulations
By Scott A. Coleman on
After moving alone in 2020 to reform its Community Reinvestment Act (CRA) regulation, the Office of the Comptroller of the Currency (OCC) has joined the Federal Deposit Insurance Corporation (FDIC) and Federal Reserve Board in issuing a joint notice of proposed rulemaking setting forth proposed amendments to their regulations implementing the CRA. … Continue Reading
CFPB issues annual fair lending report
By Michael Gordon & John L. Culhane, Jr. on
The CFPB recently issued its annual fair lending report covering its fair lending activity in 2021.
In the report’s discussion of its risk-based approach for prioritizing fair lending supervisory and enforcement activity, the CFPB indicates that much of its enforcement and supervision efforts were focused on advancing its priorities of advancing racial and economic equity and promoting economic recovery related to the COVID-19 pandemic. … Continue Reading