[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 1205 Introduced in Senate (IS)]
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116th CONGRESS
1st Session
S. 1205
To amend the Equal Credit Opportunity Act to require creditors to
request demographic information from applicants for certain types of
credit in order to prevent discriminatory lending practices with
respect to those applicants, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
April 11, 2019
Mrs. Gillibrand (for herself, Ms. Klobuchar, Mr. Wyden, and Mr.
Blumenthal) introduced the following bill; which was read twice and
referred to the Committee on Banking, Housing, and Urban Affairs
_______________________________________________________________________
A BILL
To amend the Equal Credit Opportunity Act to require creditors to
request demographic information from applicants for certain types of
credit in order to prevent discriminatory lending practices with
respect to those applicants, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Protections in Consumer Lending
Act''.
SEC. 2. COLLECTION OF DEMOGRAPHIC INFORMATION.
(a) In General.--The Equal Credit Opportunity Act (15 U.S.C. 1691
et seq.) is amended by inserting after section 704B (15 U.S.C. 1691c-2)
the following:
``SEC. 704C. COLLECTION OF DEMOGRAPHIC INFORMATION.
``(a) Definitions.--In this section--
``(1) the terms `annual percentage rate' and `interest'
have the meanings given those terms in section 987(i) of title
10, United States Code;
``(2) the term `covered transaction' means--
``(A) the extension of credit with respect to the
purchase of a motor vehicle;
``(B) the extension of credit with respect to which
the annual percentage rate of interest imposed is
greater than 36 percent;
``(C) the extension of credit--
``(i) in an amount that is less than
$15,000; or
``(ii) with respect to which the period of
repayment is less than 3 years; and
``(D) the opening of a credit card account; and
``(3) the term `covered year' means a year in which a
creditor engages in a covered transaction.
``(b) Purpose; Sense of Congress.--
``(1) Purpose.--The purpose of this section is to provide
the Bureau and the public with data that can be used to--
``(A) help determine whether creditors are serving
the credit-lending needs of the communities in which
the creditors are located; and
``(B) assist in--
``(i) identifying possible discriminatory
lending patterns; and
``(ii) enforcing antidiscrimination
statutes, including this title.
``(2) Sense of congress.--It is the sense of Congress that
nothing in this section is intended to encourage unsound
lending practices or the allocation of credit.
``(c) Collection of Information.--
``(1) In general.--Subject to the other provisions of this
section, after a creditor decides whether to approve an
application submitted by an applicant with respect to a covered
transaction, the creditor--
``(A) shall--
``(i) request from the applicant the
information described in paragraph (2) with
respect to the applicant;
``(ii) when collecting information under
clause (i), provide a disclaimer to the
applicant regarding--
``(I) the purposes of the
collection of the information; and
``(II) the right of the applicant
under paragraph (3);
``(iii) itemize the information with
respect to the application, including any
information collected under clause (i), in
order to clearly and conspicuously disclose--
``(I) the number of the application
and the date on which the application
was received;
``(II) the type and purpose of the
covered transaction;
``(III) the amount of the credit or
credit limit applied for with respect
to the covered transaction;
``(IV) if applicable, the amount of
the credit or credit limit approved for
the applicant with respect to the
covered transaction;
``(V) the type of action taken with
respect to the application, the date on
which that action is taken, and, if the
action taken is to reject the
application, the reason for that
rejection;
``(VI) the originator of the
covered transaction;
``(VII) the credit score and debt
to income ratio of the applicant;
``(VIII) if the covered transaction
is a loan, whether or not the loan is
amortizing; and
``(IX) any additional data that the
Bureau determines would aid in
fulfilling the purposes of this
section; and
``(iv) in accordance with subsection (e),
submit any information collected under clause
(i) and the information itemized under clause
(iii) to the Bureau, which shall--
``(I) store and maintain that
information;
``(II) make the information
available online in accordance with
subsection (e)(5); and
``(III) take the action described
in subsection (f) with respect to the
information; and
``(B) in carrying out subparagraph (A), may not
include in any record the name, specific address,
telephone number, electronic mail address, or any other
personally identifiable information of the applicant.
``(2) Information described.--The information described in
this paragraph shall include, with respect to an applicant who
submits an application to a creditor in connection with a
covered transaction--
``(A) the age of the applicant;
``(B) the race of the applicant;
``(C) the color of the applicant;
``(D) the sex of the applicant;
``(E) the marital status of the applicant;
``(F) the sexual orientation of the applicant; and
``(G) the gender identity of the applicant.
``(3) Right to refuse.--An applicant with respect to a
covered transaction may refuse to provide any information
requested under paragraph (1) with respect to the covered
transaction.
``(d) No Access by Underwriters.--
``(1) Limitation.--Where feasible, and subject to paragraph
(2), no loan underwriter or other officer or employee of a
creditor, or any affiliate of a creditor, involved in making
any determination concerning an application with respect to a
covered transaction may have access to any information provided
by the applicant with respect to that covered transaction
pursuant to a request for information under subsection
(c)(1)(A)(i) in connection with that application.
``(2) Limited access.--If a creditor determines that a loan
underwriter or other officer or employee of the creditor, or
any affiliate of the creditor, involved in making any
determination concerning an application with respect to a
covered transaction should have access to any information
provided by the applicant with respect to that covered
transaction pursuant to a request for information under
subsection (c)(1)(A)(i) in connection with that application,
the creditor shall provide notice to the applicant--
``(A) regarding the access of the underwriter to
that information; and
``(B) that the creditor may not discriminate on the
basis of that information.
``(e) Disclosure of Information to Bureau.--
``(1) In general.--Not later than March 1 of the year after
a covered year for a creditor, the creditor shall submit to the
Bureau all of the information that the creditor collected under
clause (i) of subsection (c)(1)(A) and itemized under clause
(iii) of that subsection during that covered year.
``(2) Information retained.--Each creditor that submits
information to the Bureau under paragraph (1) shall retain a
copy of that information in the records of the creditor for not
less than 3 years after the date on which the creditor submits
the information.
``(3) Prohibition.--A creditor that collects information
under subsection (c)(1)(A) may not--
``(A) share, exchange, transfer, sell, disclose, or
otherwise permit access to that information except as
provided in this subsection; or
``(B) use that information for any purpose,
including for a purpose relating to marketing, except
as provided in this subsection.
``(4) Disclosure statement.--The Bureau shall make
available a disclosure statement based on the information that
each creditor submits for a covered year under paragraph (1),
which--
``(A) shall include--
``(i) the number of applications for
covered transactions that the creditor received
and approved during that covered year; and
``(ii) the zip code and State of residence
for each applicant with respect to an
application for a covered transaction received
by the creditor during that covered year; and
``(B) may not include any information described in
subsection (c)(1)(B).
``(5) Online disclosure.--The Bureau shall--
``(A) post a general notice regarding the
availability of the information received by the Bureau
under paragraph (1);
``(B) in the notice posted under subparagraph (A),
clearly convey that the information described in that
subparagraph is available on the website of the Bureau;
and
``(C) when making the information received under
paragraph (1) available on the website of the Bureau,
ensure that--
``(i) the information is easy for members
of the public to access and understand; and
``(ii) accessing and reading the
information does not require the use of any
advanced computer program or software.
``(f) Bureau Action.--
``(1) Ensuring no discrimination.--
``(A) In general.--The Bureau shall examine the
information submitted to the Bureau under subsection
(e) or subparagraph (B), as applicable, to ensure
that--
``(i) each creditor makes a decision
regarding whether to approve an application for
a covered transaction based on the internal
requirements and policies of the creditor with
respect to the extension of credit; and
``(ii) no creditor with respect to a
covered transaction discriminates against an
applicant with respect to that covered
transaction on the basis of any characteristic
of the applicant described in subsection
(c)(2).
``(B) Information from other government entities.--
For the purposes of subparagraph (A), the Bureau may
rely on information that is collected by another
Federal, State, or local government agency and
submitted to the Bureau if the Director of the Bureau
determines that--
``(i) relying on that information promotes
transparency; and
``(ii) the information collected by that
other agency is substantially similar to the
information that is submitted to the Bureau
under subsection (e).
``(2) Enforcement.--
``(A) In general.--The Bureau may take such action
as the Bureau determines to be necessary or appropriate
to carry out paragraph (1)(A), including by--
``(i) imposing a civil penalty in an amount
described in section 706(b) against a creditor
that violates that paragraph; and
``(ii) as appropriate, referring a matter
to the Attorney General.
``(B) Rules of construction regarding bona fide
errors.--
``(i) Unintentional errors.--An error by a
creditor in compiling or recording information,
including an incorrect entry for a census tract
number, may not be construed as a violation of
this section if the error is unintentional and
occurs despite the maintenance of procedures by
the creditor that are reasonably adapted to
avoid those errors.
``(ii) Inaccurate or incomplete
information.--If a creditor, not later than 30
days after the end of each calendar quarter,
makes a good faith effort to record all
information required to be collected under
clause (i) of subsection (c)(1)(A) and itemized
under clause (iii) of that subsection during
that quarter and some of that information is
nevertheless inaccurate or incomplete, the
error or omission, as applicable, may not be
construed to violate this section if the
creditor corrects or completes the information
before submitting the information to the Bureau
under subsection (e).
``(g) Reporting Requirement.--Not later than 1 year after the date
of enactment of this section, and annually thereafter, the Bureau shall
submit to Congress a report regarding the efforts of the Bureau in
carrying out this section.''.
(b) Technical and Conforming Amendment.--The table of contents for
the Equal Credit Opportunity Act (15 U.S.C. 1691 et seq.) is amended by
inserting after the item relating to section 704B (15 U.S.C. 1691c-2)
the following:
``704C. Collection of demographic information.''.
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