The requirements of the Equal Credit Opportunity Act (ECOA) and its enforcing Regulation B are pretty well known. After all, the ECOA is one of the original chapters of the Consumer Credit Protection Act, dating back to the 1960s.
The rule is pretty straight forward: Thou shall not discriminate against any applicant for consumer credit on the basis of race, color, religion, national origin, sex, marital status, age (provided he or she is of age to contract), or the exercise of rights under the consumer credit protection laws.
As of June 18, 2020, we have a new wrinkle. That was the date that the U.S. Supreme Court handed down its decision in Bostock v. Clayton County, Georgia. That case dealt with employment and civil rights, and held that an employer cannot discriminate against an employee based on sexual orientation or gender identification.
Bostock was an employment case brought under Title VII of the Civil Rights Act of 1964. It was not a case involving credit at all. So, why am I writing about it?
I write about it because the concepts underlying credit extension law and employment law have long been recognized as shared. So, it is certainly likely that any adverse credit extension decision based upon sexual orientation, will be just as unlawful under the ECOA’s prohibition of discrimination based upon sex, as it is under Title VII’s prohibition.
It would seem to be a questionable business decision for any consumer finance company or installment seller to turn down a good applicant based upon sexual orientation or gender identification anyway. Now, not only might it be poor business, it is also likely to be unlawful.
Please note: This is the one hundred fourteenth blog in a series of Back to Basics blogs, in which relevant and resourceful information can be easily accessed by clicking here.
