What do federal bank and thrift examiners do to enforce fair lending laws?
Every federal bank regulatory agency has teams of examiners that regularly audit the operations of the banks, in order to ensure that the banks do not discriminate –intentionally or otherwise—in their lending practices. The agencies rely on uniform Interagency Fair Lending Examination Procedures when examining for discrimination. These spell out the examination guidelines, and in so doing, also provide institutions with the agencies’ thinking on fair lending compliance. Examinations may begin with the raw data, such as the publicly available HMDA data, and then proceed to a detailed statistical analysis to determine if any variances are actually evidence of discrimination. Since statistical analysis cannot tell the whole story, the examiners will undertake file reviews to make sure there is no mistake. If, after detailed review, the examiners have reason to believe discrimination may have taken place, the law requires that the matter be referred to HUD or the Department of Justice for
