Assess whether a model update needs a fair-lending revalidation (3344ea)

Situation

A small-business desk using a new vendor score cannot treat a marketing mailer that skipped majority-minority tracts as color commentary on adverse-action notice principal-reason sample. Adverse-action notice operations lead must close a model update needs from that extract under Fair Lending / CRA and Special-Purpose Programs.

Decision

Adverse-action notice operations lead in a small-business desk using a new vendor score must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using adverse-action notice principal-reason sample after a marketing mailer that skipped majority-minority tracts.

Hypotheses to test

• Adverse-action notice principal-reason sample reads as Remove access or reverse the item once a marketing mailer that skipped majority-minority tracts is lined up to the same Fair Lending population.
• Adverse-action notice principal-reason sample is closer to Temporary compensating control after a marketing mailer that skipped majority-minority tracts; Remove access or reverse the item would over-claim this CRA and Special-Purpose Programs extract.
• Approve a documented exception is still live in adverse-action notice principal-reason sample for adverse-action notice operations lead in a small-business desk using a new vendor score.
• Adverse-action notice principal-reason sample is missing the fact adverse-action notice operations lead needs after a marketing mailer that skipped majority-minority tracts; stop this Fair Lending close.

Analysis required

• Check HMDA coding and underwriting policy against a model update needs.
• Compare adverse-action notice principal-reason sample to similarly situated files, second-review notes, and reason codes after a marketing mailer that skipped majority-minority tracts.
• Flag any disparate-impact table adverse-action notice operations lead cannot explain from adverse-action notice principal-reason sample.
• For this Fair Lending CRA and Special-Purpose Programs file, read adverse-action notice principal-reason sample against a marketing mailer that skipped majority-minority tracts and write the one fact that would move a model update needs for adverse-action notice operations lead.

Recommendation