ECOA

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During Richard Cordray’s tenure as CFPB director, it began to look like we were heading toward an era of much more aggressive application of the Equal Credit Opportunity Act to small business lending.  The biggest potential development was the anticipated small-business lending data collection rule, which would have imposed HMDA-like reporting requirements for small business lending, which in turn would have generated the statistical information that could have been used in fair lending examinations and enforcement with respect to small business lending.… Continue Reading

On September 5, 2018 a group of 14 state Attorneys General and the AG for the District of Columbia sent a comment letter to CFPB Acting Director Mick Mulvaney, urging him to refrain from “reexamining the requirements” of the Equal Credit Opportunity Act (“ECOA”). The AGs seek to preserve the interpretation that the ECOA provides for disparate impact liability.… Continue Reading

The U.S. Department of Housing and Urban Development (HUD) has issued an advance notice of proposed rulemaking (ANPR) seeking comment on whether its 2013 Disparate Impact Rule (Rule) should be revised in light of the 2015 U.S. Supreme Court ruling in Texas Department of Housing and Community Affairs v. Inclusive Communities Project, Inc.… Continue Reading

Although the CFPB’s leadership transition rightfully remains top of mind for many of our readers, we wanted to recap two developments related to serving consumers who are Limited English Proficient (LEP). In the days before Director Cordray’s resignation, the CFPB officially approved Fannie Mae and Freddie Mac’s final redesigned Uniform Residential Loan Application (URLA), which added a question about mortgage applicants’ language preference.… Continue Reading

The CFPB has filed an amicus brief in Regions Bank v. Legal Outsource PA, a case on appeal to the Eleventh Circuit that involves two important issues under the Equal Credit Opportunity Act (ECOA): whether the ECOA provides a cause of action to loan guarantors and whether a business entity can assert a marital status discrimination claim under the ECOA.… Continue Reading

On September 14, 2017, the CFPB issued a no-action letter – the first one ever issued by the agency – to a marketplace lender, stating that the agency had no present intention to take enforcement or supervisory action against the lender under the Equal Credit Opportunity Act (ECOA) relating to the lender’s underwriting model, and especially its use of certain alternative data fields. … Continue Reading

The Department of Justice has filed an amicus brief in a case pending before the U.S. Court of Appeals for the Second Circuit that presents the question of whether the prohibition on employment discrimination on the basis of sex in Title VII of the Civil Rights Act includes discrimination based on sexual orientation. … Continue Reading

We previously reported on the Executive Order 13772 titled “Core Principles for Regulating the United States Financial System,” which is a high-level policy statement consisting of a series of Core Principles that are designed to inform the manner in which the Administration regulates the financial system.  The Executive Order directs the Secretary of the Treasury to identify, in a report to the President, any laws, regulations, guidance and other Government policies “that inhibit Federal regulation of the United States financial system in a manner consistent with the Core Principles.”… Continue Reading

Last Friday in New Orleans, the ABA Business Law Section Consumer Financial Services Committee hosted a fascinating program about CFPB enforcement at the Section’s 2017 Spring Meeting.  The program was entitled:  “Too Much or Too Little?  Is the CFPB Exercising its Enforcement Power with Appropriate Restraint?”  As might  be expected, the two industry representatives on the panel criticized certain of the CFPB’s enforcement initiatives, including, among others, the PHH case and the use of disparate impact analysis in connection with  discretionary dealer pricing to assess Equal Credit Opportunity Act (“ECOA”) compliance by auto finance companies. … Continue Reading

The CFPB may seek to rely on a recent Seventh Circuit employment discrimination case to support its view that the Equal Credit Opportunity Act’s (ECOA’s) prohibition against discrimination on the basis of “sex” includes discrimination based on sexual orientation.

In Hively v. Ivy Tech Community College of Indiana, the court held that Title VII of the Civil Rights Act of 1964 prohibits employment discrimination against individuals because of their sexual orientation.… Continue Reading