The current regulatory structure and failings by some regulators has resulted in inconsistent enforcement of antidiscrimination laws among lenders, a report by Congress’ investigative arm concluded.The Government Accountability Office noted that since 2005, the NCUA has referred no lenders to the Department of Justice for further investigation for potential violations, while during the same period the Federal Reserve, the FDIC, the Office of the Comptroller of the Currency and Office of Thrift Supervision have referred more than 100 lenders.The GAO said the findings “raise important questions about the consistency of ‘fair lending oversight,’” and that there needs to be additional analysis of the data.NCUA Chairman Michael E. Fryzel said in a written response that the data analysis should be done “prior to reaching the conclusion about the consistency and effectiveness of NCUA’s regulatory oversight.” He noted that NCUA made no referrals because they should “only be done where there is a clear pattern or practice of discriminatory actions,” and the agency didn’t identify any actions during the time period. He added that credit unions may have a better record in this area because they have a better understanding of their members’ financial needs and are designed to meet the credit and savings needs of persons of modest means.The NCUA’s examiners receive the same training on detecting discriminatory practices as their counterparts at other regulatory agencies and the same laws are applicable to all agencies.The data collected by all of the agencies is compiled by the Federal Financial Institutions Examination Council, which tracks mortgage lending transactions at 8,610 financial institutions covered by the Home Mortgage Disclosure Act.The council’s data include disclosure statements for each financial institution, aggregate data for each metropolitan statistical area, nationwide summary statistics regarding lending patterns and the Loan Application Register, modified for borrower privacy, submitted by each institution to its supervisory agency.The GAO called for requiring lenders to submit more data to document their lending patterns and urged Congress to find ways to “ensure more consistent and effective federal oversight of the fair lending laws.”The U.S. House members who requested the study said it proved that the current system needs better oversight and that is one reason they are supporting President Obama’s proposal to create a new agency to regulate consumer financial products.“The results of the GAO’s study on fair lending unfortunately come as no surprise to me,” said U.S. Rep. Luis Gutierrez (D-Ill.), who chairs the House Financial Services Committee’s subcommittee with jurisdiction over credit unions.“The weaknesses of our current system in identifying and ending discriminatory lending practices is something that my constituents and Americans across the country have lived with for too long,” he said. “Recent consumer studies have indicated what we have known to be true at the community level. African-American and Latino borrowers are significantly more likely to receive a subprime loan or to be targeted by predatory lenders.”–[email protected]

Complete your profile to continue reading and get FREE access to, part of your ALM digital membership.

Your access to unlimited content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
  • Exclusive discounts on ALM and CU Times events.
  • Access to other award-winning ALM websites including and

Already have an account?


© 2023 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.


Credit Union Times

Join Credit Union Times

Don’t miss crucial strategic and tactical information necessary to run your institution and better serve your members. Join Credit Union Times now!

  • Free unlimited access to Credit Union Times' trusted and independent team of experts for extensive industry news, conference coverage, people features, statistical analysis, and regulation and technology updates.
  • Exclusive discounts on ALM and Credit Union Times events.
  • Access to other award-winning ALM websites including and

Already have an account? Sign In Now
Join Credit Union Times

Copyright © 2023 ALM Global, LLC. All Rights Reserved.