Assess whether a redlining pattern exists after controls (f8a8d5)

Situation

SPCP written plan versus actual originations arrived with a marketing mailer that skipped majority-minority tracts for second-review underwriter. That is a Fair Lending Examination and Notices decision on a redlining pattern exists in a credit union rolling out a special-purpose credit program.

Decision

Second-review underwriter in a credit union rolling out a special-purpose credit program must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using SPCP written plan versus actual originations after a marketing mailer that skipped majority-minority tracts.

Hypotheses to test

• Second-review underwriter can defend Remove access or reverse the item from SPCP written plan versus actual originations after a marketing mailer that skipped majority-minority tracts in a Fair Lending challenge.
• Second-review underwriter cannot defend Remove access or reverse the item from SPCP written plan versus actual originations; Temporary compensating control is what the extract actually supports after a marketing mailer that skipped majority-minority tracts.
• A marketing mailer that skipped majority-minority tracts never reached the population in SPCP written plan versus actual originations — reopen intake, do not close a redlining pattern exists.
• Two facts in SPCP written plan versus actual originations after a marketing mailer that skipped majority-minority tracts conflict for second-review underwriter; hold this Examination and Notices file.

Analysis required

• Compare SPCP written plan versus actual originations to similarly situated files, second-review notes, and reason codes after a marketing mailer that skipped majority-minority tracts.
• Flag any disparate-impact table second-review underwriter cannot explain from SPCP written plan versus actual originations.
• Test a documented exception versus a pattern a credit union rolling out a special-purpose credit program must defend.
• For this Fair Lending Examination and Notices file, read SPCP written plan versus actual originations against a marketing mailer that skipped majority-minority tracts and write the one fact that would move a redlining pattern exists for second-review underwriter.

Recommendation