Attorney General Bonta Opposes Trump Administration’s Proposal to End Rules That Prevent Credit Discrimination

No going back - everyone deserves fair access to credit

OAKLAND - California Attorney General Rob Bonta today joined a coalition of 21 attorneys general in sending a comment letter opposing the Trump Administration's Consumer Financial Protection Bureau's (CFPB) proposed rule that would remove or change several provisions of the Equal Credit Opportunity Act (ECOA) regulations, effectively eliminating critical antidiscrimination tools. The provisions in question prohibit lenders from discriminating against applicants based on personal characteristics when evaluating, approving, or setting the terms of credit. In the letter, the attorneys general request that CFPB withdraw the rule, arguing that these provisions are consistent with the statutory purpose of ECOA and are still necessary in today's credit market.

"The federal government is seeking to reverse decades of established rules that prevent discrimination in the credit industry despite there being continued clear examples of ongoing discriminatory treatment by credit and lending institutions," said Attorney General Bonta. "Eliminating these safeguards would leave people more vulnerable to unfair treatment, financial harm, and opaque lending practices. Everyone, no matter their background, race, age, sex, or religion, deserves fair and transparent access to credit. Credit should not be a privilege, but a right for economic opportunity. We urge the CFPB to withdraw these proposed rules that will create insurmountable barriers to enforcing antidiscrimination statutes."

What is Credit Discrimination?

Credit discrimination is when a lender makes a decision about offering or denying credit based on a person's race, color, religion, national origin, sex, marital status, age, military or veteran status, because they receive public assistance, or based on another impermissible basis. Credit discrimination can manifest in various ways, such as consumers being discouraged from applying for credit, being offered less favorable terms such as higher interest rates or higher fees, or being refused credit despite meeting requirements, because of the factors listed above.

People use credit to take out student loans, open businesses, and buy cars and homes. Building credit helps consumers to build a better future for themselves and future generations. Credit discrimination prevents people from having access to these opportunities and can make credit more expensive.

The Federal Government's Proposal

On November 13, 2025, the CFPB published a proposed amendment to ECOA regulations that would undermine protections against credit/loan application discouragement; severely restrict special purpose credit programs offered by for-profit organizations; and remove the ability to claim disparate impact to demonstrate discrimination. Disparate-impact discrimination occurs when a seemingly neutral policy or action causes a disproportionate and unjustified negative harm to a group based on a characteristic like race or marital status. These provisions have been in place for decades and were originally designed to prevent discrimination on the basis of race, color, religion, national origin, sex or marital status, and age in the credit and lending industry. These provisions are imperative to combatting credit and lending discrimination.

In the comment letter, the attorneys general argue that amendments to provisions regarding disparate impact and discouragement violate the Administrative Procedure Act and undermine ECOA. The attorneys general further argue that proposed amendments to the disparate impact provisions should be withdrawn because:

• Contrary to the position taken by the CFPB in the proposal, a proper reading of ECOA compels the conclusion that the statute authorizes a disparate impact theory of liability.
• The proposal erroneously and without any factual basis assumes that in the absence of disparate impact liability, consumers will still enjoy the broad protections against discrimination that ECOA was enacted to provide.
• Disparate impact liability is an entirely lawful mechanism for enforcing antidiscrimination statutes that provide for this theory of liability.

The attorneys general additionally argue that proposed amendments to the discouragement provisions should be withdrawn because:

• The proposed changes to the discouragement regulations are unlawful.
• The proposed revisions will harm consumers and state enforcement efforts.
• Imposing these harms based solely on unproven speculation is arbitrary and capricious.

Earlier this month, Attorney General Bonta issued a consumer alert reminding Californians that discrimination is still illegal under state and federal law, following CFPB's premature termination of a consent order that documented its settlement with Citibank for allegedly discriminating against Armenian-American credit card applicants in Southern California, sending a strong message of the Trump Administration's abandonment of these critical protections for consumers.

In filing the comment letter, Attorney General Bonta is joined by the attorneys general of Arizona, Colorado, Connecticut, Delaware, District of Columbia, Hawai'i, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New York, North Carolina, Oregon, Rhode Island, Vermont, and Washington.