NEWS: Today, the NCUA issued a letter to all federally insured credit unions (21-RA-07), reminding them that federal law prohibits discrimination based on sexual orientation and gender identity.
The letter references a CFPB interpretive rule that took effect in March. The rule clarified that the prohibition against sex discrimination in the Equal Credit Opportunity Act (ECOA) and Reg. B includes discrimination based on sexual orientation and gender identity discrimination. The interpretive rule also covered discrimination based on actual or perceived non-conformity with sex- or gender-based stereotypes, and discrimination based on an applicant’s associations. The League summarized the CFPB rule in a March Compliance Courier.
The rule clarified that ECOA and Regulation B cover discrimination against individuals, not merely groups. It also stated that sex discrimination includes discrimination motivated by actual or perceived non-conformity with sex- or gender-based stereotypes, such as discrimination based on a lender’s perception that a customer’s attire does not accord with the customer’s perceived gender.
“Credit unions should ensure their policies, procedures, and training materials promote compliance with ECOA and Regulation B consistent with the interpretive rule,” the NCUA wrote. “Credit unions should also review automated scoring, decisioning, and pricing models for variables that could be proxies for these prohibited bases.”
For more about the ECOA and Reg. B, please see The League’s ii Release No. B041.