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Attorney General Josh Stein Leads Coalition to Urge CFPB to Protect Consumers from Credit Discrimination

Release date: 9/5/2018

(RALEIGH) Attorney General Josh Stein today led a coalition of 14 attorneys general urging the Consumer Financial Protection Bureau (CFPB) and Acting Director Mick Mulvaney to continue protecting the rights of consumers against credit discrimination under the Equal Credit Opportunity Act (ECOA). The Attorneys General, who share authority with the CFPB to enforce regulations about the ECOA and lead antidiscrimination efforts in their own states, are advising that the CFPB continue enforcing the ECOA, including its provision for disparate impact liability.

“As Attorney General, it’s my job to protect North Carolina consumers and to ensure that everyone is treated equally,” said Attorney General Josh Stein. “Along with the 13 other attorneys general in this coalition, I will continue to stand up for people so their lives aren’t damaged by credit discrimination. I urge the CFPB to fulfill its legal obligation to uphold nondiscriminatory lending practices.”

The ECOA is the principle federal antidiscrimination law for all forms of credit except home mortgage lending. It prohibits creditors from discriminating against consumers on the basis of race, color, religion, national origin, sex, marital status, and age. The ECOA also protects people from discriminatory intent and unconscious prejudices that do not mention race, color, religion, national origin, sex, marital status, or age, but still have a discriminatory effect that prevents equality of opportunity. This is called disparate impact liability. The CFPB is charged with oversight and enforcement of federal laws relevant to nondiscriminatory lending and credit practices, which includes interpreting the ECOA.

The Supreme Court’s 2015 ruling in Inclusive Communities dictated that the text of the ECOA provides for disparate impact liability, and numerous courts have continued to recognize disparate impact claims under the ECOA. In their letter, the Attorneys General say they “will not hesitate to uphold the law if CFPB acts in manner contrary to law with respect to interpreting ECOA.”

Attorney General Stein is joined in sending this letter by the Attorneys General of California, Illinois, Maine, Maryland, Massachusetts, Minnesota, New Jersey, New York, Oregon, Rhode Island, Vermont, Virginia, and Washington, D.C.

A copy of the letter can be found here.

Laura Brewer (919) 716-6484