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Category Archives: Fair Credit

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Republican members of House Financial Services Committee release new report on CFPB’s auto finance actions

Posted in Auto Finance, CFPB Enforcement, CFPB People, Fair Credit, Fair Lending

Republican members of the House Financial Services Committee recently released a report, prepared by the Republican Staff of the Committee, titled “Unsafe at Any Bureaucracy, Part III: The CFPB’s Vitiated Legal Case Against Auto Lenders.”  This is the third Republican Staff report examining the automotive ECOA enforcement actions of the CFPB with respect to what… More >

Industry trade groups’ renewed challenge to HUD disparate impact rule could yield helpful precedent for ECOA cases

Posted in Fair Credit

The D.C. district court recently granted two industry trade associations whose members sell homeowners insurance leave to file an amended complaint in their lawsuit challenging the Fair Housing Act (FHA) disparate impact rule (Rule) adopted by the U.S. Department of Housing and Urban Development (HUD).  In their amended complaint, the trade associations allege that the… More >

Ballard attorneys to receive 2016 Distinguished Legal Writing Award for auto finance disparate impact article

Posted in Auto Finance, Fair Credit

I am proud to report that Ballard attorneys Peter N. Cubita and Christopher J. Willis have been selected to receive a 2016 Distinguished Legal Writing Award from The Burton Awards, which recognize outstanding legal writing.  They are being honored for their article entitled “Auto Finance and Disparate Impact: Substantive Lessons Learned from Class Certification Decisions,” which… More >

Director Cordray defends CFPB positions in appearance before Senate Banking Committee; comments on small business lending and Fintech companies

Posted in Auto Finance, CFPB Enforcement, Fair Credit, Payday Lending, Small Business

Much of Director Cordray’s testimony in his appearance before the Senate Banking Committee yesterday consisted of his predictable defense of various CFPB positions.  While the hearing was much less contentious than last month’s hearing of the House Financial Services Committee at which Director Cordray appeared, the questions raised by Republican Senators focused on many of the… More >

Another auto finance company agrees to change dealer compensation policy to settle ECOA claims alleged by CFPB and DOJ

Posted in Auto Finance, Fair Credit

The CFPB and Department of Justice (the “Agencies”) announced recently that they have entered into a settlement with Toyota Motor Credit Corporation (TMCC) to resolve charges that TMCC engaged in unlawful discrimination in violation of the Equal Credit Opportunity Act (ECOA).  The settlement includes TMCC’s agreement to change its so-called “dealer compensation policy” and pay… More >

Congressional report chronicles and criticizes CFPB auto finance ECOA enforcement activity

Posted in Auto Finance, CFPB Enforcement, Fair Credit

Republican members of the House Financial Services Committee recently released a report, prepared by the Republican Staff of the Committee, which chronicles in detail the controversial automotive ECOA enforcement initiative of the CFPB with respect to what it characterizes as “dealer markup.”  The highly critical nature of the report is encapsulated by its title, which… More >

House passes bill to nullify CFPB indirect auto finance guidance

Posted in Auto Finance, Fair Credit

Yesterday, by a vote of 332-96, the House of Representatives passed H.R. 1737, the “Reforming CFPB Indirect Auto Financing Guidance Act,” which would nullify the CFPB’s indirect auto finance guidance issued in March 2013 and require the CFPB to provide for a notice and comment period before issuing any new guidance on indirect auto finance. … More >

U.S. Supreme Court Hears Oral Arguments in Case to Decide Whether Loan Guarantors Are “Applicants” Under ECOA

Posted in Fair Credit

Earlier this week the Supreme Court heard oral arguments in the case of Hawkins v. Community Bank of Raymore. We have issued an E-alert discussing this important case, which we expect will resolve whether a spouse-guarantor is an “applicant” under the ECOA. Notably, the CFPB joined in an amicus brief filed by the United States in support of Regulation B’s… More >

ABA seeks supervisory and enforcement standards consistent with Inclusive Communities

Posted in Fair Credit

The American Bankers Association has sent a letter to the DOJ, Fed, OCC, FDIC, HUD and CFPB requesting confirmation “in interagency guidance, updated exam procedures, and where appropriate amended regulations that the Agencies’ consideration of disparate impact claims in both the supervisory and enforcement context will be governed by standards consistent with the [Supreme] Court’s… More >

Auto finance company agrees to change dealer compensation policy to settle CFPB and DOJ fair lending claims

Posted in Auto Finance, CFPB Enforcement, Fair Credit

Earlier this month, American Honda Finance Corporation (AHFC) entered into a settlement with the CFPB and the Department of Justice to resolve charges that it engaged in unlawful discrimination in violation of the Equal Credit Opportunity Act (ECOA).  The settlement includes AHFC’s agreement to change its auto dealer compensation policy, pay $24 million in restitution,… More >

Cognizability of ECOA disparate impact claims remains an open question after Inclusive Communities

Posted in Fair Credit

A sharply divided U.S. Supreme Court announced its decision in Texas Department of Housing and Community Affairs v. The Inclusive Communities Project, Inc. on June 25, 2015, holding that disparate impact claims are cognizable under the Fair Housing Act. Inclusive Communities does not resolve the question of whether disparate impact claims are cognizable under the Equal Credit Opportunity… More >

BREAKING NEWS: U.S. Supreme Court rules disparate impact claims are cognizable under the FHA

Posted in Fair Credit, Mortgages

The U.S. Supreme Court ruled this morning that disparate impact claims are cognizable under the Fair Housing Act.  Justice Kennedy wrote the majority opinion in Texas Department of Housing and Community Affairs v. The Inclusive Communities Project, Inc., in which Justices Ginsburg, Breyer, Sotomayer and Kagan joined.  Justice Alito wrote a dissenting opinion, in which Chief… More >

CFPB files amicus brief in U.S. Supreme Court ECOA case

Posted in Fair Credit

The CFPB, together with the Solicitor General, has submitted an amicus brief in Hawkins v. Community Bank of Raymore, the case in which the question before the U.S. Supreme Court is whether the Equal Credit Opportunity Act (ECOA) applies to loan guarantors.  The Court agreed to hear the case in March 2015 and is expected… More >

House approves amendment prohibiting use of appropriated funds for DOJ disparate impact litigation under the FHA

Posted in Fair Credit

Yesterday, the House of Representatives approved an amendment to H.R. 2578, the Fiscal Year 2016 Commerce, Justice, and Science Appropriations Act, that would bar the use of appropriated funds by the Department of Justice to bring Fair Housing Act enforcement actions that rely on an allegation of liability under the HUD Disparate Impact Rule.  The… More >

Ballard attorneys author article on auto finance and disparate impact

Posted in Auto Finance, Fair Credit

In several blog posts and legal alerts, we have previously written about disparate impact and auto finance.  Together with our colleague, Jonathan Selkowitz, we have recently written an article on “Auto Finance and Disparate Impact: Substantive Lessons Learned from Class Certification Decisions.” The article, which was published in the May 1, 2015 edition of the Consumer… More >

CFPB issues compliance bulletin on unlawful discrimination based on receipt of mortgage assistance

Posted in Fair Credit, Mortgages

In a new compliance bulletin (Bulletin 2015-02), the CFPB “reminds” creditors of their obligation not to discriminate against applicants because their income includes vouchers from the Section 8 Housing Choice Voucher (HCV) Homeownership program.  The CFPB states in the bulletin that it “has become aware of one or more institutions excluding or refusing to consider… More >

Justice Department’s ECOA report describes joint CFPB activity

Posted in Fair Credit

The U.S. Department of Justice recently issued the Attorney General’s 2014 Annual Report to Congress Pursuant to the Equal Credit Opportunity Act Amendments of 1976.  The report discusses the DOJ’s 2014 ECOA enforcement activities as well as what the report describes as the DOJ’s “lending work” under the Fair Housing Act and the Servicemembers Civil… More >

Trade groups urge CFPB to respond to AFSA vehicle sales finance study

Posted in Auto Finance, Fair Credit

Five prominent industry trade groups sent a letter to the CFPB yesterday seeking “to engage the CFPB in a constructive dialogue” on the study of indirect auto financing commissioned by the American Financial Services Association.  The study, which was conducted by Charles River Associates, found that the CFPB’s proxy methodology for measuring disparities in auto dealer… More >

Third time is the charm: U.S. Supreme Court hears argument in FHA disparate impact case

Posted in Fair Credit

The U.S. Supreme Court heard oral argument last week in Texas Department of Housing and Community Affairs v. The Inclusive Communities Project, Inc.— the case presenting the issue of whether disparate impact claims are cognizable under the Fair Housing Act (FHA).  Two prior cases presenting this issue were settled after merits briefing but before oral… More >

Ballard Spahr submits amicus brief in Inclusive Communities

Posted in Fair Credit

The U.S. Supreme Court is scheduled to hear oral argument tomorrow, January 21st, in Texas Department of Housing and Community Affairs v. The Inclusive Communities Project, Inc., the case presenting the issue whether disparate-impact claims are cognizable under the Fair Housing Act. Ballard Spahr attorneys have written an amicus brief submitted by the Houston Housing Authority (HHA).  HHA… More >

Supreme Court to hear oral argument on Jan. 21st in FHA disparate impact case

Posted in Fair Credit

The U.S. Supreme Court has set January 21, 2015 as the date for oral argument in Texas Department of Housing and Community Affairs v. The Inclusive Communities Project, Inc., which is the case presenting the issue whether disparate impact claims are cognizable under the Fair Housing Act.  The petitioners’ merits brief was filed on November 17th…. More >

AFSA vehicle sales finance study finds significant flaws in CFPB disparate impact methodology and approach

Posted in Auto Finance, Fair Credit

A study of indirect auto financing commissioned by the American Financial Services Association found that the CFPB’s proxy methodology for measuring disparities in auto dealer reserve is “conceptually flawed in its application and subject to significant bias and estimation error.”  Among the study’s other key findings was that the CFPB’s preferred alternative dealer “compensation” methods, namely… More >

CFPB issues bulletin on consideration of public assistance income in credit decisions

Posted in Fair Credit, Mortgages

The CFPB has issued a new bulletin (Bulletin 2014-03) that is intended “to remind creditors” of their ECOA/Regulation B obligations with respect to consideration of public assistance income and relevant standards and guidelines regarding verification of  Social Security Disability Insurance and Supplemental Security Income (together, Social Security disability income). Based on an accompanying CFPB blog… More >

Disparate impact on the ropes: federal district court vacates HUD rule

Posted in Fair Credit

A federal district court in Washington, D.C. dealt a heavy blow on Monday to HUD’s position that disparate impact claims are cognizable under the Fair Housing Act (FHA).  In American Insurance Association v. U.S. Department of Housing and Urban Development, a case we have been watching for some time, the court issued an opinion vacating the… More >