In a significant policy shift, an executive order issued by President Trump mandates that federal agencies cease utilizing disparate impact as a basis for enforcement or supervision. This directive is aimed at reshaping the landscape of civil rights enforcement, particularly in sectors such as housing and lending where the concept of disparate impact has been a key legal standard. By removing the basis for claims that can target policies or practices disproportionately affecting specific demographic groups, the executive order raises concerns about potential regression in protections for minority populations and may simplify compliance for businesses, particularly in the mortgage and housing industries.
Key elements of the executive order include:
– **Elimination of Disparate Impact**: Directs federal agencies to abandon the use of disparate impact as grounds for enforcement actions, which could redefine standards in housing and lending sectors.
– **Impact on Civil Rights Enforcement**: The order may lead to reduced scrutiny over practices that, while neutral on their face, disproportionately affect certain groups, raising concerns among civil rights advocates about potential setbacks in equality measures.
– **Business Compliance Simplification**: Lifting the disparate impact standard may ease compliance burdens for businesses, possibly leading to more streamlined processes in mortgage lending and housing policies.
You can read this full article at: https://www.housingwire.com/articles/occ-drops-disparate-impact-enforcement-fair-lending-risk-assessment/(subscription required)
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