On February 9, the Federal Trade Commission (FTC) submitted its annual letter to the Consumer Financial Protection Bureau (CFPB) summarizing its activities enforcing the Equal Credit Opportunity Act (ECOA) and its implementing regulation, Regulation B. This letter is included in the CFPB’s annual report to Congress on the ECOA. A copy of the summary was also provided to the Federal Reserve Board.

The FTC is responsible for ECOA and Regulation B enforcement for financial service providers that are not banks, thrifts, or federal credit unions. In its summary, the FTC described its work on ECOA-related issues, including enforcement actions, research, and policy development such as:

• Initiating two cases against auto dealership groups alleging the dealerships violated ECOA by discriminating against Black (and in one case Latino) consumers by charging higher interest rates and illegal “junk fees.”
  • See prior discussion of one of those cases here.
• Issuing a report to Congress titled “Combatting Online Harms Through Innovation,” warning about using artificial intelligence to combat online problems, noting concerns that these tools can have inherent potential for inaccuracy, bias, and discrimination, and can harm marginalized communities.
• Co-Hosting the Fifteenth Annual FTC Microeconomics Conference, which included a discussion on designing dealer compensation in the auto loan market. The segment addressed, among other things, how the discretionary mark-up of interest rates can vary systematically by protected characteristics such as gender and race, and it also referenced the ECOA protections.
• Working as a liaison to the American Bar Association’s Standing Committee on Legal Assistance for Military Personnel (ABA LAMP). During ABA LAMP trainings and meetings, the FTC addressed issues related to military consumers’ rights pertaining to the anti-discrimination provisions in the ECOA and Regulation B.
• Participating as a member of the Interagency Task Force on Fair Lending, a joint undertaking with the CFPB, the U.S. Department of Justice (DOJ), the U.S. Department of Housing and Urban Development (HUD), and the federal banking agencies, which shares information and discusses policy issues.
• Participating as a member of the Interagency Fair Lending Methodologies Working Group, with the CFPB, the Federal Housing Finance Agency, DOJ, HUD, and the federal banking agencies, to coordinate and share information on analytical methodologies used in the enforcement and supervision of compliance with fair lending laws, including ECOA.
• Providing guidance for consumers emphasizing that creditors may not consider during the application process or when making a credit decision, things such as a consumers’ race or sex, including sexual orientation and gender identity.