ICBA submitted a comment letter
strongly supporting the Department of Housing and Urban Development’s proposal to modernize its disparate impact rule to be more in line with the U.S. Supreme Court decision in Texas Department of Housing & Community Affairs v. The Inclusive Communities Project Inc
HUD’s existing disparate impact rule, which has not been revised since 2013, is inconsistent with the Supreme Court’s decision, has created ambiguity for community banks and has exposed lenders to uncertainty when managing their policies and meeting their fair lending responsibilities.
In its comments, ICBA praised HUD's proposal for its defenses for banks where their discretion is limited because of a third party, such as a federal, state or local law.
ICBA also asked the agency to clarify that the statute of limitations starts at the time a lending decision is made and that punitive damages are reserved for cases where the defendant’s actions are truly reprehensible and demonstrate a disregard for the rights of others.