Assess whether a special-purpose program is well designed or a pretext

Situation

Small-business decline comparative file set arrived with a SPCP that originated almost no loans to the intended class for adverse-action notice operations lead. That is a Fair Lending CRA and Special-Purpose Programs decision on a special-purpose program is in a small-business desk using a new vendor score.

Decision

Adverse-action notice operations lead in a small-business desk using a new vendor score must choose A special-purpose program is well designed / A pretext using small-business decline comparative file set after a SPCP that originated almost no loans to the intended class.

Hypotheses to test

• A SPCP that originated almost no loans to the intended class is noise around an already-controlled CRA and Special-Purpose Programs process in a small-business desk using a new vendor score, given small-business decline comparative file set.
• A SPCP that originated almost no loans to the intended class is the event in small-business decline comparative file set that forces A special-purpose program is well designed for adverse-action notice operations lead under Fair Lending.
• Small-business decline comparative file set shows a one-file miss after a SPCP that originated almost no loans to the intended class, not a CRA and Special-Purpose Programs program failure.
• Small-business decline comparative file set cannot decide a special-purpose program is yet after a SPCP that originated almost no loans to the intended class; hold is the only Fair Lending close a small-business desk using a new vendor score can defend.

Analysis required

• Compare small-business decline comparative file set to similarly situated files, second-review notes, and reason codes after a SPCP that originated almost no loans to the intended class.
• Flag any disparate-impact table adverse-action notice operations lead cannot explain from small-business decline comparative file set.
• Test a documented exception versus a pattern a small-business desk using a new vendor score must defend.
• For this Fair Lending CRA and Special-Purpose Programs file, read small-business decline comparative file set against a SPCP that originated almost no loans to the intended class and write the one fact that would move a special-purpose program is for adverse-action notice operations lead.

Recommendation