Assess whether line assignments have a disparate impact the bank will defend

Situation

A credit-card issuer changing line-assignment logic cannot treat an exception rate twice as high for one group after credit controls as color commentary on small-business decline comparative file set. Adverse-action notice operations lead must close line assignments have a from that extract under Fair Lending / Examination and Notices.

Decision

Adverse-action notice operations lead in a credit-card issuer changing line-assignment logic must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using small-business decline comparative file set after an exception rate twice as high for one group after credit controls.

Hypotheses to test

• Authorize Remove access or reverse the item now; small-business decline comparative file set already has the discriminator after an exception rate twice as high for one group after credit controls.
• Keep Temporary compensating control in force until small-business decline comparative file set is completed after an exception rate twice as high for one group after credit controls for adverse-action notice operations lead.
• Treat small-business decline comparative file set as Approve a documented exception because both readings appear after an exception rate twice as high for one group after credit controls.
• Refuse a Fair Lending close: adverse-action notice operations lead does not have the page line assignments have a turns on in small-business decline comparative file set.

Analysis required

• Compare small-business decline comparative file set to similarly situated files, second-review notes, and reason codes after an exception rate twice as high for one group after credit controls.
• Flag any disparate-impact table adverse-action notice operations lead cannot explain from small-business decline comparative file set.
• Test a documented exception versus a pattern a credit-card issuer changing line-assignment logic must defend.
• For this Fair Lending Examination and Notices file, read small-business decline comparative file set against an exception rate twice as high for one group after credit controls and write the one fact that would move line assignments have a for adverse-action notice operations lead.

Recommendation