ALEXANDRIA, Va.–NCUA has issued a "reminder" in follow up to a February Letter to Credit Unions addressing Equal Credit Opportunity Act (ECOA) Nondiscrimination Requirements.
The agency noted that letter discussed violations the agency has observed involving credit unions, including the prohibited basis variable “age” in their automated underwriting systems, and said it was issuing its new message as a “reminder that having a policy or practice of requiring manual underwriting as an exception to automated underwriting systems based on a minimum or maximum age violates ECOA and its implementing regulation, Regulation B.”
“An example of such prohibited age discrimination is having system parameters that require applicants or co-applicants to be at least 25 years of age and no older than 70 years of age at the time of application to receive an automatic approval,” NCUA said. “Applications that meet the system criteria for automatic approval are offered credit pending verification of income and review of collateral, as applicable. Applications that do not meet the system criteria for automatic approval are referred to an underwriter for a manual review.”
Manual Underwriting May Not Be Required
In addition, NCUA said creditors may not require manual underwriting as an exception to automated underwriting systems based on an applicant’s marital status. An example of such prohibited marital status discrimination is including system parameters that permit automatic approval of married joint applicants but require a manual review of applications submitted by unmarried joint applicants.
“Credit unions using automated underwriting systems need to review their systems’ settings and related loan policies and practices to ensure they do not result in age, marital status, or other prohibited basis discrimination,” NCUA said. “ECOA violations can result in administrative enforcement and referral to the Department of Justice for potential prosecution.”
NCUA Webinar Today on Cyber Incident Reporting Rule
Separately, NCUA will host a webinar today for its new cyber incident notifications rule.
The new rule, scheduled to go into effect on Sept. 1, requires a federally insured credit union to notify the NCUA as soon as possible, within 72 hours, after it reasonably believes that a reportable cyber incident has occurred.
Registration for this webinar is now open. The webinar is scheduled to begin at 2 p.m. Eastern and last approximately 45 minutes. The agency said Christina Saari, information systems officer with the its Office of Examination and Insurance, will discuss:
- When to report a cyber incident
- How to report the cyber incident to the NCUA
- What to include in the cyber incident report.
The webinar will be close captioned, and there is no charge NCUA said. Participants will be able to log in and view the event on their computers or mobile devices using the registration link. They should allow pop-ups from this website.
Any technical questions about accessing the webinar should be emailed to either uccwebinar@ncua.gov or uccsupport@ncua.gov.
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