In promulgating its rule implementing the Fair Housing Act’s discriminatory effects standard, the Department of Housing and Urban Development erred in ignoring Supreme Court precedent on determining disparate impact, ABA and 52 state bankers associations wrote in a comment letter to HUD today.

In a move long sought by ABA, the Department of Housing and Urban Development is formally seeking public comment on whether its rule implementing the Fair Housing Act's discriminatory effects standard is consistent with the Supreme Court decision in Texas Department of Housing and Community Affairs v. Inclusive Communities Project.

In a move long sought by ABA, the Department of Housing and Urban Development signaled today that it will seek public comment on whether its rule implementing the Fair Housing Act discriminatory effects standard is consistent with the Supreme Court decision in Texas Department of Housing and Community Affairs v. Inclusive Communities Project.

The Department of Housing and Urban Development’s rule implementing the Fair Housing Act discriminatory effects standard is inconsistent with current Supreme Court precedents on disparate impact theory and could be negatively affecting HUD’s housing goals, a group of House Republicans said in a letter to HUD Secretary Ben Carson today.

Responding to a request by the Department of Housing and Urban Development for suggestions of outdated or ineffective regulations, ABA and state bankers associations in all 50 states today called for changes to HUD’s rule implementing the Fair Housing Act discriminatory effects standard, calling the rule “outdated and legally wrong.”

As part of the banking industry’s continuing response to President Trump’s executive order outlining “core principles” for financial regulation, ABA today urged federal regulators and law enforcement to reign in disparate impact and redlining investigations that go beyond the law and Supreme Court precedent.

The creditor will need to defend its underwriting practices to “prove” that education level provides some amount of repayment predictability.

The possibility of a 4-4 deadlock hangs over three cases with repercussions for the banking industry when the Court convenes in October.

The Department of Housing and Urban Development last week issued guidance stating that discrimination or “discriminatory effects” toward those with limited English proficiency is forbidden under the Fair Housing Act.

The case that generated last summer’s Supreme Court decision allowing disparate impact cases to be brought under the Fair Housing Act, Inclusive Communities Project Inc. v. Texas Department of Housing and Community Affairs, was dismissed on last week by the district court judge charged with determining whether the housing advocacy plaintiff met the Court’s newly articulated standard for establishing disparate impact.