On May 2, the U.S. Department of Housing and Urban Development (HUD) released two sets of guidance addressing the applicability of the Fair Housing Act (FHA) to two areas where, in the agency’s view, algorithmic processes and artificial intelligence (AI) pose particular concerns: tenant screening and advertising of housing opportunities through online platforms that use targeted ads. The purpose of HUD’s guidance is to make housing providers, tenant screening companies, advertisers, and online platforms aware that the FHA applies to tenant screening and housing advertising, including when algorithms and AI are used to perform those functions.

In a recent speech at the National Consumer Law Center/National Association of Consumer Advocates Spring Training, Seth Frotman, General Counsel of the Consumer Financial Protection Bureau (CFPB or Bureau), focused on medical billing and collections and tenant screening and debt, emphasizing the CFPB’s enforcement of the Fair Debt Collection Practices Act (FDCPA) and Fair Credit Reporting Act (FCRA) in these areas.

Last week, the U.S. Department of Housing and Urban Development (HUD) issued a Notice of Proposed Rulemaking, seeking public comment on its proposal to amend existing regulations that govern admission to public housing and housing programs for applicants with criminal records and eviction or termination of assistance of persons on the basis of illegal drug use, drug-related criminal activity, or other criminal activity. The proposed rule would require that, prior to any discretionary denial or termination for criminal activity, public housing agencies (PHAs) and assisted housing owners take into consideration multiple sources of information, including but not limited to the recency and relevance of prior criminal activity. The proposed rule also seeks to clarify existing PHA and owner obligations and reduce the risk of violation of nondiscrimination laws.

We are pleased to share our annual review of regulatory and legal developments in the consumer financial services industry. With active federal and state legislatures, consumer financial services providers faced a challenging 2023. Courts across the country issued rulings that will have immediate and lasting impacts on the industry. Our team of more than 140 professionals has prepared this concise, yet thorough analysis of the most important issues and trends throughout our industry. We not only examined what happened in 2023, but also what to expect — and how to prepare — for the months ahead.

On January 11, the Consumer Financial Protection Bureau (CFPB or Bureau) issued two “advisory opinions” addressing the CFPB’s views of the obligations of consumer reporting agencies (CRAs) under the Fair Credit Reporting Act (FCRA). The advisory opinions are interpretive rules issued under the Bureau’s authority to interpret the FCRA pursuant to § 1022(b)(1) of the Consumer Financial Protection Act of 2010.

On October 30, President Biden issued a sweeping Executive Order calling on Congress to enact privacy laws and directing federal agencies to review existing rules and potentially explore new rulemakings governing the use of artificial intelligence (AI) across various sectors of the U.S. economy. Among other things, the Executive Order will require AI system developers to submit safety test results to the federal government, establish standards for detecting AI-generated content to fight consumer fraud, and develop AI tools to identify and fix vulnerabilities in critical software. According to the White House fact sheet, the stated goal of the Executive Order is to “ensure that America leads the way in seizing the promise and managing the risks of [AI].” To that end, the Executive Order focuses on national security, privacy, discrimination and bias, healthcare safety, workplace surveillance, innovation, and global leadership.

A new enforcement action provides more detail on the expectations of the Consumer Financial Protection Bureau (CFPB) and Federal Trade Commission (FTC) (collectively, the agencies) for the content of tenant screening reports.

When using artificial intelligence (AI) or complex credit models, can lenders rely on the checklist of reasons provided in Regulation B sample forms for adverse action notices? According to today’s guidance issued by the Consumer Financial Protection Bureau (CFPB or Bureau), the answer to that question is, in many circumstances, no.

The U.S. Supreme Court has been asked to decide whether a homeowner association (HOA) assessment constitutes a “credit transaction” under the Fair Credit Reporting Act (FCRA), which would open up an inquiry to the fundamental scope of one of the FCRA’s most important permissible purposes.

On July 24, the California Office of Administrative Law approved the Civil Rights Council’s (the Council) proposed amendment to California’s Employment Regulations Relating to Criminal History, which are set to become effective on October 1, 2023. Among other changes, the amendment modifies the existing regulations regarding employers’ investigation of a job applicant’s criminal history. Notably, the amendment expands the definition of “employer” under those regulations in such a way that could potentially implicate a background screener conducting a background check on behalf of an employer.