Assess whether a model update needs a fair-lending revalidation (7f2965)

Situation

The desk packet is underwriting exception log by branch after a marketing mailer that skipped majority-minority tracts. Model-risk partner for credit scoring in a lender expanding into majority-minority census tracts has to name Remove access or reverse the item or Temporary compensating control for this Fair Lending Examination and Notices file.

Decision

Model-risk partner for credit scoring in a lender expanding into majority-minority census tracts must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using underwriting exception log by branch after a marketing mailer that skipped majority-minority tracts.

Hypotheses to test

• The population in underwriting exception log by branch is the one a marketing mailer that skipped majority-minority tracts named, so Remove access or reverse the item follows for this Examination and Notices file.
• The population in underwriting exception log by branch is adjacent only to a marketing mailer that skipped majority-minority tracts; Temporary compensating control is the honest Fair Lending call.
• A lender expanding into majority-minority census tracts already contained a marketing mailer that skipped majority-minority tracts before underwriting exception log by branch arrived; no new Examination and Notices path.
• Provenance on underwriting exception log by branch after a marketing mailer that skipped majority-minority tracts is broken; do not pick Remove access or reverse the item or Temporary compensating control yet.

Analysis required

• Flag any disparate-impact table model-risk partner for credit scoring cannot explain from underwriting exception log by branch.
• Test a documented exception versus a pattern a lender expanding into majority-minority census tracts must defend.
• Match the adverse-action language to the facts in underwriting exception log by branch.
• For this Fair Lending Examination and Notices file, read underwriting exception log by branch against a marketing mailer that skipped majority-minority tracts and write the one fact that would move a model update needs for model-risk partner for credit scoring.

Recommendation

Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / Examination and Notices packet (underwriting exception log by branch after a marketing mailer that skipped majority-minority tracts). If underwriting exception log by branch cannot force a Fair Lending label under Examination and Notices, stop. Do not invent pages a lender expanding into majority-minority census tracts does not have.