The CFPB lately filed a complaint within the U.S. District Court docket for the Northern District of Illinois in opposition to a small mortgage lender for allegedly violating ECOA and the Shopper Monetary Safety Act (CFPA) based mostly on the lender’s sponsorship of and participation in speak radio packages of a political nature.
The Equal Credit score Alternative Act (ECOA) prohibits collectors from discriminating in opposition to candidates on the idea of assorted protected traits, together with race, and its implementing rules prohibit statements or acts that “discourage” potential candidates from making use of for credit score on the idea of a prohibited attribute. Amongst different allegations, the grievance alleges that in a radio present sponsored by the defendant firm, the corporate’s president made disparaging remarks about neighborhoods with majority-black populations. The grievance additional alleges that these remarks would discourage African-Individuals from making use of for credit score from the defendant, thus violating the ECOA’s implementing rules.
The grievance additionally alleges that the defendant drew a statistically considerably decrease proportion of mortgage purposes from properties in African-American neighborhoods, in comparison with the defendant’s peer mortgage lenders. The defendant mortgage lender has indicated that it plans to lift a primary modification protection, amongst others.
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