"Finance cos. should brace for wider CFPB anti-bias reach" by Jonice Gray Tucker, Kari K. Hall, and Caroline M. Stapleton (Law360)
Law360Jonice Gray Tucker, Kari K. Hall, Caroline M. Stapleton
The Consumer Financial Protection Bureau recently raised eyebrows when it broadly expanded the legal theories under which it will seek to challenge illegal discrimination in the financial services industry.
The CFPB announced on March 16 that it revised its examination manual to identify discrimination as a potential unfair, deceptive or abusive act or practice, or UDAAP, in addition to a violation of laws focused specifically on anti-discrimination.
Previously, the Equal Credit Opportunity Act had served as the primary tool in the CFPB's arsenal for combating discrimination against protected classes in financial services. The CFPB has affirmed it will continue to actively enforce the ECOA, but in releasing its updated exam manual the agency has staked out its intention to guide "examiners in looking beyond discrimination directly connected to fair lending laws," particularly where complex or novel technologies or data sources are involved.
Originally published in Law360; reprinted with permission.