Racial bias

The Consumer Financial Protection Bureau, building on an executive order by President Trump, wants to eliminate the legal framework of "disparate impact" from its implementation of the Equal Credit Opportunity Act.

A headline-grabbing 2022 lawsuit alleging racial bias by home appraisers has been quietly dismissed for lack of evidence. At the same time, the Trump administration is rolling back many of the policy changes involving home appraisals that the Biden administration put in place.

Opposition is growing to the Trump administration's efforts to roll back fair lending requirements for lenders imposed by Biden-era prosecutors.

The Consumer Financial Protection Bureau asked a federal judge to vacate and set aside a settlement against a Chicago mortgage lender, accusing the CFPB of misconduct in a case brought under former Director Kathy Kraninger, a Trump appointee.

The lender denied its software uses artificial intelligence in fighting a 'digital redlining' case.

A federal appeals court ruled that the Equal Credit Opportunity Act prohibits not just outright discrimination but also the discouragement of prospective applicants for credit.

All cultures have explicit and implicit biases. Preventing discrimination when large language models are involved starts with using high-quality human-curated data and text.

AI tools, such as large language models, offer the promise of increased efficiency; but they also carry with them potential legal and regulatory risks. Financial service providers will need to find a way to strike the right balance as technological advancements continue to emerge.

In recent years, the wealth gulf between white and Black families has only grown. But there is hope that advances in fintech, such as wider adoption of artificial intelligence, can help.

The Justice Department and the CFPB are increasingly relying on emails among employees that contain discriminatory comments to strengthen their hand in cases against lenders.

A mixed-race couple claims a "whitewashed" valuation in 2023 returned a price 39% higher than the depository-approved result a year earlier.

As part of a settlement with the Justice Department, Patriot Bank must invest more than $1 million of the total in a loan subsidy fund for minority homeowners and take other corrective steps in its everyday business. The bank denied any wrongdoing.

The lawsuit accuses Navy Federal of violating the Fair Housing Act and the Equal Credit Opportunity Act after a CNN report that the lender approved a lower percentage of Black and Latino mortgage applicants.

A Connecticut-based couple sued the bank and Cavanaugh Appraisals, LLC for denying them a refinance in 2021 because of racial bias.

Six regulatory agencies are seeking public comment on a proposed rule that would establish best practices for using automated valuation models to assess collateral.

The Stroudsburg, Pennsylvania-based financial institution, from 2017 to 2021, did not sufficiently serve the credit needs of majority-Black and Hispanic neighborhoods in and around Philadelphia, the DOJ alleges.

Prosecutors claim every dollar in subsidy funds from settlements equates to ten times the amount in value in home lending efforts.

The Ohio-based bank concentrated most of its lending branches in majority-white neighborhoods and did nothing to compensate for its lack of physical presence, the DOJ claims.

It came as a surprise to many housing experts that Asian, Black and Hispanic homeownership rates all jumped last year by more than 2 percentage points, according to quarterly Census Bureau data.