ALEXANDRIA, Va.–NCUA has announced it has removed all references to disparate impact liability from its Fair Lending Guide and other issuances.
Disparate impact liability holds entities accountable for neutral policies or practices that unintentionally but disproportionately harm protected groups, such as those based on race, sex, or national origin, even without discriminatory intent.
The agency said the changes follow with White House Executive Order 14281, Restoring Equality of Opportunity and Meritocracy which directs federal agencies to eliminate the use of disparate impact liability in all contexts.
What’s No Longer Included
NCUA said its examination and supervision processes will no longer include reviews for disparate impact and the agency will no longer request, review, or conclude or follow-up on:
- Matters related to a credit union’s disparate impact risk
- Internal disparate-impact risk analysis
- Disparate-impact risk assessment processes or procedures
“Consistent with applicable law, the NCUA will continue to conduct fair lending examinations and risk assessments and take appropriate action if evidence of disparate treatment or other violations are found,” NCUA said in a statement.
