Office of the
Illinois Attorney General
Kwame Raoul

Chicago – Attorney General Kwame Raoul today led a coalition of 20 attorneys general in submitting a comment letter to the Consumer Financial Protection Bureau (CFPB) strongly opposing the CFPB’s proposed changes to regulations implementing the Equal Credit Opportunity Act (ECOA). According to the coalition, the proposed changes violate the Administrative Procedure Act (APA) and weaken the ECOA’s protections against discriminatory and unfair treatment in credit markets. 

Raoul and the coalition explain the CFPB issued a Notice of Proposed Rulemaking to rescind ECOA regulations that include disparate impacts of discrimination. The proposed rule would also amend regulations related to discouraging consumers from applying for credit. 

“Anyone applying for credit deserves fair treatment in lending based on creditworthiness, not the color of the applicant’s skin, age, gender or marital status,” Raoul said. “I will continue to work with my colleagues to stop unfair treatment in the credit market and fight to uphold common sense policies to avoid any and all discrimination.” 

Amendments to the ECOA in 1976 established a clear national policy preventing any credit applicant from being denied credit based on characteristics unrelated to the applicant’s creditworthiness. Consistent with Congress’ intent, these protections have included disparate impact liability to remedy the discriminatory effects of a creditor’s policies or practices, even when discrimination may be unintentional. 

In their letter, Raoul and the attorneys general state that existing regulations uphold the ECOA’s goal of ensuring all people have equal access to credit without discrimination of on basis of race, color, religion, national origin, sex, age or marital status. Instead of decreasing discrimination in credit markets, Raoul and the attorneys general warn the CFPB its proposed changes will increase discrimination and potentially harm countless Americans who will not be able to obtain credit on fair, unbiased terms. 

Raoul and the attorneys general explain these proposed changes violate the APA because: 

• The ECOA already takes into consideration the disparate impacts of discrimination.
• The proposed rule falsely assumes consumers will still enjoy broad protections against discrimination even if disparate impact is not a factor.
• Disparate impact liability is a lawful way to enforce anti-discrimination statutes.
• Proposed changes to the discouragement regulations are contrary to law.
• Proposed revisions will harm credit applicants and enforcement efforts.
• Imposing harms based on assertion and speculation without proof is arbitrary and unreasonable. 

Joining Raoul in sending the letter are attorneys general of Arizona, California, Colorado, Connecticut, Delaware, the District of Columbia, Hawaii, Illinois, Maine, Maryland, Michigan, Minnesota, Nevada, New Jersey, New York, North Carolina, Oregon, Rhode Island, Vermont and Washington.