CFPB rescinds Regulation B advisory opinion
The CFPB has rescinded a 2020 advisory opinion on Regulation B, which implements the Equal Credit Opportunity Act (ECOA). The rescission was published today in the Federal Register and covers certain facets of for-profit special purpose credit programs (SPCPs) designed and deployed to benefit historically underserved or economically disadvantaged groups.
In April the CFPB finalized an America’s Credit Unions-supported rule updating ECOA, determining the SPCP standards of Regulation B no longer permit such programs to use the common characteristics of race, color, national origin, or sex as eligibility criteria. Importantly, neither the SPCP component of the final rule nor today’s advisory opinion apply to credit unions, as they deal with SPCP programs at for-profit institutions.
The 2020 advisory opinion was rescinded primarily due to it no longer being consistent with the April final rule, and to “avoid any confusion about the appropriate standards and related conditions for SPCPs offered or participated in by for-profit organizations.”
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