Two leaders of the CFPB’s Fair Lending Office – Patrice Ficklin, Fair Lending Director, and Charles Nier, Senior Fair Lending Counsel – recently published an article advocating for broader use of special purpose credit programs (“SPCPs”) by creditors. The article, entitled “The Use of Special Purpose Credit Programs to Promote Racial and Economic Equity” and framed as an essay, can be found in the Poverty & Race Research Action Council’s (“PRRAC”) May 2021 edition of its series on new directions in racial justice in housing finance and is available here. … Continue Reading
ECOA
Third Circuit holds ECOA does not preempt NJ’s doctrine of necessaries and affirms dismissal of FDCPA claims
The U.S. Court of Appeals for the Third Circuit has held that the Equal Credit Opportunity Act does not preempt New Jersey’s common-law doctrine of necessaries whereby a spouse is jointly liable for necessary expenses incurred by the other spouse. As a result, the plaintiff could not rely on preemption as the basis for her claim that the defendant law firm violated the Fair Debt Collection Practices Act by attempting to collect a debt from her that she did not owe for her deceased husband’s medical expenses.… Continue Reading
CFPB Issues Interpretive Rule Clarifying that Sex Discrimination under ECOA and Regulation B Includes Sexual Orientation and Gender Identity Discrimination
Under the leadership of Acting CFPB Director Dave Uejio, the Bureau issued an interpretive rule on March 9, 2021 clarifying that the prohibition against sex discrimination under the Equal Credit Opportunity Act (“ECOA”) and Regulation B includes sexual orientation and gender identity discrimination. This prohibition includes discrimination based on actual or perceived non-conformity with traditional sex- or gender-based stereotypes, and discrimination based on an applicant’s social or other associations.… Continue Reading
HUD Acting Assistant Secretary issues directive to enforce FHA to prohibit sexual orientation discrimination: What are the implications for the CFPB?
Last week, HUD’s Acting Assistant Director for Fair Housing and Equal Opportunity issued a memorandum directing HUD’s Office of Fair Housing and Equal Opportunity to take a series of actions “to administer and fully enforce the Fair Housing Act to prohibit discrimination because of sexual orientation and gender identity.”
The memorandum is intended to implement President Biden’s Executive Order 13988 on Preventing and Combating Discrimination on the Basis of Gender Identity or Sexual Orientation (Executive Order). … Continue Reading
FTC Issues Annual ECOA Report to CFPB
On January 26, 2021, the FTC sent its annual letter to the CFPB reporting on the FTC’s activities related to the Equal Credit Opportunity Act (“ECOA”) and Regulation B. The Bureau leverages the FTC’s annual letter for its own Annual Report to Congress on ECOA.
The FTC has authority to enforce the ECOA and Regulation B with respect to nonbank financial service providers within its jurisdiction.… Continue Reading
President Biden Issues Executive Order Directing HUD to Review Fair Housing Act Disparate Impact Rule
In a memorandum issued on January 26, 2021, President Biden has ordered the Secretary of the U.S. Department of Housing and Urban Development (“HUD”) to “as soon as practicable, take all steps necessary to examine the effects of” the final rule issued by HUD in September 2020 (“2020 Rule”) revising its 2013 Fair Housing Act (“FHA”) disparate impact standards (“2013 Rule”).… Continue Reading
CFPB Issues Advisory Opinion Addressing Regulatory Uncertainty Regarding Special Purpose Credit Programs
On December 21, 2020, the CFPB issued an advisory opinion that addresses regulatory uncertainty related to certain aspects of special purpose credit programs (“SPCPs”) designed and implemented by for-profit organizations. The advisory opinion was issued as an interpretive rule that will be published in the Federal Register and therefore is exempt from the notice and comment rulemaking requirements of the Administrative Procedure Act.… Continue Reading
CFPB and FTC file joint amicus arguing consumers not applying for credit are “applicants” under ECOA
The CFPB and FTC have filed a joint amicus brief in the U.S. Court of Appeals for the Second Circuit urging the court to reverse a district court ruling that an individual who had already received credit from the defendant and who was not currently applying to the defendant for credit was not an “applicant” for purposes of the ECOA’s adverse action notice requirement.… Continue Reading
CFPB extends comment period for RFI on expanding credit access and further protecting consumers from credit discrimination
The CFPB has extended by 60 days the comment period for its Request for Information (RFI) on how best to create a regulatory environment that expands access to credit and ensures that all consumers and communities are protected from discrimination in all aspects of a credit transaction. Originally set to expire on October 2, the comment period will now close on December 1, 2020.… Continue Reading
CFPB Issues Request for Information on Expanding Access to Credit and Further Protecting Consumers from Credit Discrimination
On July 28, 2020, the CFPB issued a request for information (“RFI”) seeking public input on how best to create a regulatory environment that expands access to credit and ensures consumers and communities are protected from discrimination in all aspects of credit transactions. The Bureau issued the RFI in lieu of a symposium it had planned to host this fall on Equal Credit Opportunity Act (“ECOA”) issues.… Continue Reading