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One of the most important areas of consumer financial regulation today is the use of internet- or social media-based platforms to target advertising for consumer financial products.  Its importance stems from the fact that financial services companies can obtain significant benefits from directing advertising to those consumers most likely to be interested in a product,…

In this podcast, we examine the fair lending risk to financial services providers that use targeted marketing.  After reviewing what targeted marketing is, the forms it can take, and current litigation, we discuss the potential fair lending claims and the options available to providers to reduce the fair lending risk created by the use of…

A purported class action filed last week in the U.S. District Court for the Northern District of California, accuses Facebook of discriminating against women and individuals over 40 who were denied advertisements and information about certain financial services opportunities, including those for bank accounts, insurance, and investing.

According to the complaint, Facebook encourages financial…

A new CFPB blog post titled “An update on credit access and the Bureau’s first No-Action Letter” provides a boost to lenders using alternative data and machine learning in their underwriting models.

The Bureau issued its first (and so far only) no-action letter in September 2017 to Upstart Network Inc. stating that the…

The CFPB’s annual fair lending report covering its 2018 activities was published in today’s Federal Register.  While most of the report recycles information about which we have previously blogged, it does contain the following noteworthy information:

  • In September 2018, the CFPB held a symposium to address the issue of access to credit for consumers

…

According to a Wall Street Journal report, Facebook has agreed to remove age, gender, and zip code targeting for housing, employment, and credit-related advertisements as part of a settlement of a lawsuit filed by the National Fair Housing Alliance, the Communications Workers of America, and other plaintiffs.

While Facebook reportedly did not permit advertisers…

While the pace of the CFPB’s fair lending activities has slowed under its new leadership, significant fair lending developments are occurring elsewhere.  In this week’s podcast, we discuss several of those developments and their broader implications.  Our discussion focuses on New York and Connecticut fair lending developments involving auto finance, a private redlining lawsuit, and…

Last week, the Connecticut Fair Housing Center, Inc. filed a complaint against Liberty Bank in Connecticut federal district court alleging that the Bank engaged in discriminatory mortgage lending in violation of the federal Fair Housing Act.  The complaint describes the Bank as “the eighth-largest conventional home purchase lender and eleventh-largest refinancer in Connecticut.”

The complaint…

The FDIC’s Center for Financial Research has issued a research paper that discusses the use of the information contained in a “digital footprint,” meaning the information that people leave online by accessing or registering on a website, for predicting consumer default.

The researchers considered ten digital footprint variables that included:

  • The device type (e.g. tablet

…