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Cfpb ecoa11/17/2023 ![]() ![]() “Specifically, the ECOA does not contain ‘effects’ language contained in other antidiscrimination statutes. “Several important distinctions exist between the and the ECOA, the statute under which the CFPB has authority to oversee auto lenders,” Chris Stinebert, president and CEO of the American Financial Services Association (AFSA), said at the time. ![]() These limitations are also necessary to protect defendants against abusive disparate impact claims.”Īt the time, industry trade groups said that although the Supreme Court upheld the use of disparate impact, it did significantly narrow how the legal theory can be used. “Courts should avoid interpreting disparate impact liability to be so expansive as to inject racial considerations into every housing decision. “A disparate impact claim relying on a statistical disparity must fail if the plaintiff cannot point to a defendant’s policy or policies causing that disparity,” retiring Justice Anthony Kennedy wrote in the court’s opinion. In its 5-4 ruling, the Supreme Court held that disparate impact claims “are cognizable under the Fair Housing Act.” Under the disparate impact legal theory, those policies could be in violation of the Fair Housing Act, even if their effects were unintentional. The complaint claimed that the department’s policies had a disproportionately adverse effect on minorities. ![]() The suit, filed in 2008, alleged that the Texas housing department caused segregated housing by allocating too many low-income housing tax credits to black inner-city neighborhoods and too few to predominantly white neighborhoods. In June 2015, the Supreme Court upheld the use of disparate impact in a Texas housing case involving the Texas Department of Housing and Community Affairs and The Inclusive Communities Project. “… In light the fact that bureau is required by statute to enforce federal consumer financial laws consistently, the bureau will be reexamining the requirements of the ECOA,” Mulvaney added. ![]()
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