CFA Warns CFPB Proposal to Undermine Equal Credit Opportunity Act Could Enable AI-Driven Discrimination, Digital Redlining

Washington, D.C. - The Consumer Federation of America (CFA) submitted comment to the Consumer Financial Protection Bureau (CFPB) opposing the agency's proposed changes to Regulation B implementing the Equal Credit Opportunity Act (ECOA), warning that the rule would significantly weaken core civil rights protections in credit markets.

CFA's comment argues that the CFPB proposal runs directly counter to congressional intent and decades of bipartisan regulatory precedent by stripping regulators of their ability to identify discriminatory outcomes, opening the door to renewed redlining, and discouraging lenders from offering lawful special-purpose credit programs designed to address historic inequities in access to credit.

"The CFPB's proposal to dismantle the Equal Credit Opportunity Act runs counter to the values of the American public, the financial institutions that serve them, and the clearly stated intentions of Congress, said Adam Rust, Director of Financial Services. "The proposal will strip regulators of the tools they need to identify disparate impacts, encourage redlining, and impose fear in lenders that wish to offer special-purpose credit programs.

The comment highlights three major concerns: eliminating disparate impact liability would make it nearly impossible to police discriminatory effects in AI-driven underwriting systems; narrowing discouragement standards would weaken protections against redlining, including in digital marketing; and new burdens on special-purpose credit programs would deter lenders from offering programs Congress explicitly authorized to meet special social needs.

The public comment period on the proposed Regulation B changes closed on December 15, 2025. CFA urges the CFPB to withdraw the proposal and reaffirm its commitment to fair, equitable, and nondiscriminatory access to credit for consumers and small businesses nationwide.