Assess whether a model update needs a fair-lending revalidation (7c53c7)

Situation

SPCP written plan versus actual originations arrived with a branch that stopped taking applications in one ZIP for model-risk partner for credit scoring. That is a Fair Lending CRA and Special-Purpose Programs decision on a model update needs in a credit-card issuer changing line-assignment logic.

Decision

Model-risk partner for credit scoring 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 SPCP written plan versus actual originations after a branch that stopped taking applications in one ZIP.

Hypotheses to test

• A branch that stopped taking applications in one ZIP is noise around an already-controlled CRA and Special-Purpose Programs process in a credit-card issuer changing line-assignment logic, given SPCP written plan versus actual originations.
• A branch that stopped taking applications in one ZIP is the event in SPCP written plan versus actual originations that forces Remove access or reverse the item for model-risk partner for credit scoring under Fair Lending.
• SPCP written plan versus actual originations shows a one-file miss after a branch that stopped taking applications in one ZIP, not a CRA and Special-Purpose Programs program failure.
• SPCP written plan versus actual originations cannot decide a model update needs yet after a branch that stopped taking applications in one ZIP; hold is the only Fair Lending close a credit-card issuer changing line-assignment logic can defend.

Analysis required

• Flag any disparate-impact table model-risk partner for credit scoring cannot explain from SPCP written plan versus actual originations.
• Test a documented exception versus a pattern a credit-card issuer changing line-assignment logic must defend.
• Match the adverse-action language to the facts in SPCP written plan versus actual originations.
• For this Fair Lending CRA and Special-Purpose Programs file, read SPCP written plan versus actual originations against a branch that stopped taking applications in one ZIP and write the one fact that would move a model update needs for model-risk partner for credit scoring.

Recommendation

Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / CRA and Special-Purpose Programs packet (SPCP written plan versus actual originations after a branch that stopped taking applications in one ZIP). The follow-on CRA and Special-Purpose Programs action is what model-risk partner for credit scoring does next: implement the option, assign an owner, and log the missing fact.