The Consumer Financial Protection Bureau is now targeting discriminatory lenders and says it will use all avenues, including disparate impact to pursue them.
In a statement released Wednesday accompanying a bulletin to lenders, the CFPB outlined its plan to crack down on any lenders that discriminate consumers—including equipping consumers so they can identify any unlawful practices.
“We want consumers to avoid the marketplace’s silent pickpocket—discrimination,” said CFPB Director Richard Cordray. “We cannot afford to tolerate practices, intentional or not, that unlawfully price out or cut off segments of the population from the credit markets. That’s why the CFPB is educating consumers about their fair lending rights and pursuing lenders whose practices are discriminatory.”
Banks and nonbanks will be monitored for any discrimination, the CFPB said, in reaffirming its commitment to enforcing the Equal Credit Opportunity Act (ECOA).
“Discrimination is not always obvious,” wrote CFPB’s Assistant Director for the Office of Fair Lending and Equal Opportunity Patrice Ficklin in a notice to consumers. “A borrower may not realize that she has been the victim of intentional discrimination on the basis of her race or sex. Moreover, lending policies that seem evenhanded can be illegal if they have a disproportionate, negative effect on a group that is protected under ECOA, such as women or seniors.”
View the CFPB’s bulletin.
Written by Elizabeth Ecker