On July 10, nineteen Democrat U.S. Senators sent a letter to the CFPB urging it to implement a rule required under the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank). The rule in question relates to Section of 1071 of Dodd-Frank, which requires the CFPB to collect and make public data on lending to small businesses. [...]
The Supreme Court agreed to settle the issue of whether spousal guarantors should be considered applicants and whether the Federal Reserve has the authority to create regulations to accomplish this under the Equal Credit Opportunity Act (ECOA). Since ECOA does not include guarantors in its definition of applicants, a split has arisen among circuits regarding the [...]
According to an analysis of 2013 HMDA data, black and Hispanic applicants from New York City (NYC) were significantly more likely to be denied for a mortgage than white and Asian applicants (Morningstar, 6/19/2015): Black and Hispanic applicants are disproportionately denied conventional loans in New York City, with 33.6 percent and 29.2 percent of applications [...]
Starting as early as July, the CFPB is poised to issue consent orders against three major lenders in automotive financing: American Honda Finance Corp.; Toyota Motor Credit Corp; and Nissan Motor Acceptance Corp. These consent orders will require payment to affected consumers and will represent a major victory in the CFPB's efforts to reduce pricing discretion [...]
According to a study commissioned by the American Civil Liberties Union (ACLU), the recovery following the housing crisis has diverged between minority and non-minority families. While white families showed a stronger recovery during the period of 2009-11, black families continued to see their wealth decline. A principal reason cited for this is the difference in sources [...]
On June 25th, the U.S. Supreme Court ruled that the Fair Housing Act (FHA) permits claims of discrimination based on disparate impact. Put differently, a claim of discrimination based, for example, on race can give rise to liability regardless of the lender’s intent. To succeed with a disparate impact claim under the FHA, the claimant [...]
About the Author: Jonathon Neil Jonathon is a Senior Consultant for ADI with expertise in Fair Lending compliance, CRA compliance, data mining, and geographic information systems. You can contact Jonathon at [email protected] or 703.665.3707.
The CFPB has made a concerted effort to make its programs and services accessible to financial consumers with limited proficiency in English. While this paradigm is noteworthy on its own, Paul Hastings, et al feel this could be a signal of things to come: While these recent agency activities are noteworthy developments in their own [...]
In the CFPB’s most recent Supervisory Highlights, released in mid March, one line item of note for Fair Lending violations was a rulling that a lender practiced deceptive and harmful advertising. In the highlighted case, the lender’s marketing materials contained written statements regarding the prohibition on non-employment sources of income, and discouraged applicants who received [...]
The long-delayed acquisition of Hudson City Bancorp (Hudson City) by M&T Bank Corp. (M&T) has hit another roadblock due to compliance issues. While the deal has already been delayed since 2012 due to concerns over M&T’s AML controls, a CFPB examination of Hudson City’s Fair Lending compliance has introduced new complications into the pending transaction: [...]
