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ARTICLE · 08 DECEMBER 2014

Study By Consumer Credit Group Takes Issue With CFPB Method Of Finding Auto Lending Bias

Troutman Pepper Locke LLP
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AFSA released a study this month that took issue with the Consumer Financial Protection Bureau's method of measuring discrimination in the automotive lending business.

United StatesConsumer Protection
Stephen Piepgrass
Stephen Piepgrass
Steve Rosenthal
Steve Rosenthal
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The American Financial Services Association (AFSA), a consumer credit industry trade association, released a study this month that took issue with the Consumer Financial Protection Bureau's method of measuring discrimination in the automotive lending business.

The study, which was carried out by Charles River Associates and based on over eight million vehicle finance contracts issued in 2012 and 2013, concluded that the CFPB has been using an unreliable estimating method to find discrepancies in lender compensation to dealers based on minority status.

The CFPB's methodology estimates race and ethnicity based on a loan applicant's name and census data, to determine whether minority groups are hurt by auto lending practices.

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