In light of growing concerns, the Federal Financial Institutions Examination Council (FFIEC) Appraisal Subcommittee (ASC) held its first hearing on appraisal bias on January 24, 2023, at the Consumer Financial Protection Bureau (CFPB) headquarters. The FFIEC, a federal interagency body comprised of the Board of Governs of the Federal Reserve System (FRB), Federal Deposit Insurance
Fair Lending
FTC Settlement with Auto Dealer Group Demonstrates Treatment of Discriminatory Conduct as “Unfair”
The FTC issued a release on October 18, 2022, to announce that it has initiated an enforcement action in Maryland against a Washington, D.C.-area auto dealer group, Passport Automotive Group, as well as two of its executives, Everett Hellmuth and Jay Klein. In the same release, the FTC announced that Passport, Hellmuth, and Klein have…
CFPB Plans to Increase Regulation over “Buy Now, Pay Later” Lenders
The Consumer Financial Protect Bureau (CFPB) issued a release on September 15, 2022, announcing its intent to issue additional interpretive guidance or rules to ensure “Buy Now, Pay Later” (BNPL) lenders comply with the same or similar regulations already established for credit cards following a study on the industry.
In its press release, the CFPB…
Fannie Mae and Freddie Mac Direct Collection of Borrower Information to Further Fair Lending and Fair Servicing Aims
Two recent announcements by the Federal Housing Finance Agency (FHFA) will push the mortgage servicing industry to increase its collection and maintenance of consumer demographic and language preference data.
On May 3, 2022, the FHFA announced that Fannie Mae and Freddie Mac (the GSEs) will require lenders submitting loans to the GSEs to use…
CFPB, DOJ File Complaint Against Non-Bank Mortgage Lender for Deliberate Discrimination Against Minority Families
On July 27, 2022, the Consumer Financial Protection Bureau (CFPB) and the United States Department of Justice (DOJ) filed a complaint in the United States District Court for the Eastern District of Pennsylvania against Trident Mortgage Company LP for alleged discrimination against minority families in the greater Philadelphia area.
According to the CFPB’s press release…
CFPB Provides New Guidance on Discrimination in Algorithmic Credit Decisions
As we have repeatedly discussed this year in our Financial Services Perspectives blog, the current leadership of the CFPB has placed a significant emphasis upon fair lending. Seemingly once a month, or even more frequently at times, Director Rohit Chopra has announced a new initiative concerning fair lending and discrimination in the financial services industry.
Banking Regulators Publish Proposed Rule to Update Community Reinvestment Act Regulations
On May 5, 2022, the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, and the Federal Deposit Insurance Corporation (collectively the agencies) issued a joint notice of proposed rulemaking (the Proposed CRA Rule) that proposes changes to the way the agencies evaluate a bank’s performance under the…
First DOJ Enforcement Action Against PPP Lender Presages Increased Government Scrutiny of Bank and Non-Bank PPP Lenders
Until last month, government enforcement and regulatory scrutiny of fraud and other misconduct relating to COVID-19 relief programs was generally limited to end recipients of the relief. These efforts have mostly been directed to fraud in connection with the Paycheck Protection Program (PPP), a nearly $1 trillion business loan program administered by the Small Business…
CFPB Director Addresses the Final Report of the Interagency Task Force on Property Appraisal and Valuation Equity
The current leadership of the CFPB has not been shy about highlighting the importance of fair lending—and it is becoming increasingly clear that fair lending and equity within the financial services industry is one of the CFPB’s greatest priorities under Director Rohit Chopra. Just last month, the CFPB released a blog post to discuss possible…
CFPB Issues Release Regarding its Intent to Target “Unfair Discrimination in Consumer Finance”
The Consumer Financial Protection Bureau (“CFPB”) issued a release on March 16, 2022 in order to announce changes to its supervisory operations with respect to discriminatory lending and servicing practices.
In its press release, the CFPB explains that it has changed its approach towards examination of banks and non-banks in order to more closely “scrutinize”…