Chamber and bank groups that say discrimination is not unfair have used “fair lending” to refer to non-discriminatory lending

I have blogged before about the suit brought by the Chamber of Commerce and various banking groups against the CFPB in which the plaintiffs argue that the CFPB is wrong to describe discrimination as unfair. But when I asked a research assistant to see if the plaintiffs themselves use the phrase “fair lending” laws to describe laws preventing discrimination, here is some of what she came up with: in an amicus brief that the Chamber of Commerce, American Bankers Association, and Consumer Bankers Association joined in in Texas Department of Housing and Community Affairs v. Inclusive Communities Project, Inc, a discrimination case, they wrote that they “devote substantial resources to the advancement of fair lending practices.” Brief for the American Bankers Association, et al., Texas Department of Housing and Community Affairs v. Inclusive Communities Project, Inc, No. 13-1371, U.S. Supreme Court (June 16, 2014). The American Bankers Association equates fair lending and non-discriminatory lending on its web site. For example, the description of the “Fair Lending” training it offers opens with the following:

Demonstrates how to avoid discriminatory and unfair lending practices when interacting with clients. Examines the consequences of illegal discrimination and explains the key points in the federal laws. Defines disparate treatment and disparate impact practices and identifies illegal discrimination that should be avoided at common stages in the credit process.

See also Nicholas Roesler, Mystery Shopping: Taking the Mystery out of Fair Lending, ABA RISK AND COMPLIANCE (July 6, 2021):

The surging focus on racial equity across many different aspects of society and commerce includes more attention on fair lending practices at banks. . . . The general concept behind this type of fair lending testing is to have two individuals that are carefully matched for creditworthiness characteristics (and often for similar personal appearance) walk into a bank and apply for credit. However, these two individuals should have a different prohibited basis group characteristic, such as race or sex. Then, the treatment of the pair should be observed and the customer outcomes reviewed.

It is hard to argue that discrimination is not unfair when you yourself use the word fair to mean non-discriminatory.




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