Here’s a sentence from a federal report to Congress, published October 1, 2026: “In 2025, none of the Federal agencies with ECOA enforcement authority brought public enforcement actions for violations of ECOA.”
Not one. Not the CFPB, not the FDIC, not the Fed, not the OCC, not the FTC. The same report says the CFPB “did not initiate supervisory activities or cite any fair lending violations” during the year, and that “[i]n 2025, the CFPB did not refer any matters to DOJ pursuant to 15 U.S.C. § 1691e(g).” That’s the subsection that says the Bureau “shall refer” a lender to the Attorney General when it has reason to believe the lender engaged in “a pattern or practice of discouraging or denying applications for credit”. Zero referrals.
That’s the Fair Lending Report of the Consumer Financial Protection Bureau for 2025. The headline item inside it is that the Bureau stopped using disparate impact, and then rewrote Regulation B to say the Equal Credit Opportunity Act never allowed it in the first place.
It’s easy to read that as the end of disparate impact in lending. It isn’t. An agency deciding not to bring a theory doesn’t amend the statute the theory came from. And it doesn’t lay a finger on Minnesota’s.
What is disparate impact, in plain English?
Two ways to prove discrimination. Disparate treatment is the one everybody understands: the lender treated you worse because of your race, sex, religion, or another protected trait. Intent is the whole case.
Disparate impact is the other one. A neutral rule, applied to everybody, that lands much harder on one protected group, with no good business reason to justify it. You don’t have to prove anybody meant it.
Regulation B used to say outright that ECOA covered both. The Bureau’s own final rule describes the old text this way: “Regulation B provides in Sec. 1002.6 that the legislative history of ECOA indicates that the Congress intended an ‘effects test’ concept, as outlined in the employment field by the Supreme Court in the cases of Griggs, 401 U.S. 424, and Albemarle Paper Co., 422 U.S. 405, to be applicable to a creditor’s determination of creditworthiness.” 91 Fed. Reg. at 21621. That language goes back to a 1977 Federal Reserve Board rule.
What the Bureau says it stopped doing
The report doesn’t hide the ball. Page 4:
Consistent with Executive Order 14281, the CFPB no longer uses disparate impact in its supervision or enforcement of fair lending laws. . . . In addition, the CFPB has closed all elements of open supervision exams and enforcement investigations that relied on disparate impact liability and terminated CFPB orders that relied on disparate impact liability.
Executive Order 14281 is the April 2025 order the report says “directs federal agencies to stop using disparate impact liability in the enforcement of civil rights laws.” The report also says the Bureau now focuses “on proven, intentional racial discrimination with actual identifiable victims”, and that its fair-lending exams look for “direct evidence of intentional discrimination on a prohibited basis”.
Fine. That’s an enforcement agency deciding what cases it’ll bring. Agencies do that all the time. The rule is a different animal.
What the new Regulation B actually says
The final rule ran at 91 Fed. Reg. 21620 on April 22, 2026. Its effective date is stated in one line: “This final rule is effective July 21, 2026.” So it’s in force now.
The operative change is one sentence added to § 1002.6(a):
The Act does not provide that the “effects test” applies for determining whether there is discrimination in violation of the Act.
91 Fed. Reg. at 21668. And the Bureau rewrote the official commentary, comment 6(a)-2, to say this:
The Act does not provide for the prohibition of practices that are facially neutral as to prohibited bases, except to the extent that facially neutral criteria function as proxies for protected characteristics designed or applied with the intention of advantaging or disadvantaging individuals based on protected characteristics.
91 Fed. Reg. at 21670. Read the back half of that sentence twice. Even on the Bureau’s reading, a neutral-looking criterion still violates ECOA if it’s a proxy chosen on purpose. That’s disparate treatment wearing a disguise, and the Bureau kept it.
The Bureau’s stated reason, from the report at page 15: “Disparate impact was first read into ECOA based solely on the law’s legislative history. However, under the plain meaning of ECOA’s text, disparate impact is not a cognizable theory of liability under the statute and is contrary to the principles of Equal Protection.”
That’s an argument. Now look at what it is NOT.
A regulation can’t rewrite 15 U.S.C. § 1691
The statute didn’t change. Not a comma. Section 1691(a) still reads: “It shall be unlawful for any creditor to discriminate against any applicant, with respect to any aspect of a credit transaction” on the basis of race, color, religion, national origin, sex or marital status, or age, public-assistance income, or the good-faith exercise of a consumer-credit right.
Whether “discriminate” in that sentence reaches disparate impact is a question about the meaning of a statute. And since June 2024, an agency doesn’t get the last word on that. Loper Bright Enterprises v. Raimondo, 603 U.S. 369 (2024), overruled Chevron, and the Court put it bluntly:
Courts must exercise their independent judgment in deciding whether an agency has acted within its statutory authority, as the APA requires.
Slip op. at 35. The Court allowed that “[c]areful attention to the judgment of the Executive Branch may help inform that inquiry.” But “courts need not and under the APA may not defer to an agency interpretation of the law simply because a statute is ambiguous.” Id.
Here’s the part I enjoyed. The Bureau cited Loper Bright itself. Its proposal noted that “as the Supreme Court made clear in Loper Bright Enterprises v. Raimondo, courts are the ultimate arbiters of statutory meaning.” 91 Fed. Reg. at 21625. Right. Which means the Bureau’s reading binds the Bureau. A federal judge hearing a private ECOA case will decide what § 1691 means for herself.
And the Bureau concedes the courts haven’t settled it. Its own rule says that, on ECOA, “fewer Courts of Appeals have addressed the issue and those that have either assumed without deciding that ECOA authorized disparate-impact liability or provided only limited analysis.” 91 Fed. Reg. at 21635. The rule also notes the Supreme Court “has not examined whether a disparate-impact claim is permitted under ECOA.” Id. at 21621. So it’s an open question in court. A press release can’t close it, and neither can a Federal Register notice.
The lender’s best card is in the statute itself
Now the fact that cuts the other way, and it’s a real one. ECOA has a good-faith safe harbor. Section 1691e(e):
No provision of this subchapter imposing liability shall apply to any act done or omitted in good faith in conformity with any official rule, regulation, or interpretation thereof by the Bureau . . . notwithstanding that after such act or omission has occurred, such rule, regulation, interpretation, or approval is amended, rescinded, or determined by judicial or other authority to be invalid for any reason.
Look at the last clause. Even if a court later decides the Bureau got ECOA wrong, a lender who acted “in good faith in conformity with” the rule has a statutory defense for what it did in the meantime. Expect defendants in federal disparate-impact cases built on conduct after July 21, 2026 to plead it.
Does a rule that says the Act “does not provide” for an effects test count as something a lender “conform[s]” to? That’s going to get litigated. But I wouldn’t pretend the safe harbor isn’t there. It’s the strongest thing the new rule actually does, and it’s the reason a borrower should be looking hard at state law right now.
What a private ECOA plaintiff still has
Everything the statute gives, which is plenty for a disparate-treatment case. Section 1691e provides:
- Actual damages, individually or as a class, § 1691e(a).
- Punitive damages “in an amount not greater than $10,000,” and in a class action a total that “shall not exceed the lesser of $500,000 or 1 per centum of the net worth of the creditor”, § 1691e(b). Governments are exempt from punitives.
- Equitable and declaratory relief, § 1691e(c).
- Costs and “a reasonable attorney’s fee” on any successful action, § 1691e(d).
- Five years to sue: “No such action shall be brought later than 5 years after the date of the occurrence of the violation,” § 1691e(f).
None of that moved. The Bureau’s own economic analysis says what it expects to change: “Fewer enforcement actions and private claims premised on disparate-impact theories”. 91 Fed. Reg. at 21660. Fewer. Not none.
Minnesota’s credit statute never ran through the CFPB
Congress wrote this into ECOA in 1976, and it’s still there at 15 U.S.C. § 1691d(f):
This subchapter does not annul, alter, or affect, or exempt any person subject to the provisions of this subchapter from complying with, the laws of any State with respect to credit discrimination, except to the extent that those laws are inconsistent with any provision of this subchapter, and then only to the extent of the inconsistency.
The next two sentences give the Bureau a role and then fence it in: “The Bureau is authorized to determine whether such inconsistencies exist. The Bureau may not determine that any State law is inconsistent with any provision of this subchapter if the Bureau determines that such law gives greater protection to the applicant.”
And in this rule, the Bureau declined to tell lenders how to comply with state law. Responding to lenders who asked how to handle state disparate-impact laws, the final rule says “the Bureau has primary authority for administering ECOA, but not other Federal or State laws that include a disparate-impact component. Thus, the Bureau has neither the authority nor expertise to instruct regulated entities on how to comply with those other laws.” 91 Fed. Reg. at 21637. Elsewhere it predicts the rule “may have limited impact on covered persons since they are still subject to other antidiscrimination statutes such as the FHA and State laws similar to ECOA.” Id. at 21661.
That’s the agency telling you, in its own rule, where to go next. In Minnesota, that’s Minn. Stat. § 363A.16, subd. 1:
It is an unfair discriminatory practice to discriminate in the extension of personal or commercial credit to a person, or in the requirements for obtaining credit, because of race, color, creed, religion, disability, national origin, sex, gender identity, sexual orientation, familial status, or marital status, or due to the receipt of federal, state, or local public assistance including medical assistance.
Subdivision 2 separately covers tenants on housing subsidies, and subdivision 3 covers a card issuer that refuses a woman a card under her current or former surname.
Side by side, on the points that decide a case:
| ECOA (federal) | Minnesota Human Rights Act | |
|---|---|---|
| Protected classes | Race, color, religion, national origin, sex, marital status, age, public-assistance income, exercising a consumer-credit right, § 1691(a) | Race, color, creed, religion, disability, national origin, sex, gender identity, sexual orientation, familial status, marital status, public assistance, § 363A.16, subd. 1; housing-subsidy tenants, subd. 2 |
| Deadline | 5 years, § 1691e(f) | 1 year to sue or file a charge, § 363A.28, subd. 3(a) |
| Damages | Actual damages; punitives capped at $10,000, § 1691e(a)–(b) | Compensatory damages, including mental anguish, up to three times actual; punitives under § 549.20; civil penalty to the state, § 363A.33, subd. 8(a) |
| Fees | Mandatory on success, § 1691e(d) | Discretionary, to the prevailing party, § 363A.33, subd. 7 |
| Jury | Not addressed in § 1691e | Either side “is entitled to a jury trial”, § 363A.33, subd. 6 |
| Good-faith reliance on a CFPB rule | Defense, § 1691e(e) | Chapter 363A contains no such defense |
Minnesota isn’t broader on every axis, though. Section 363A.16 doesn’t list age, and ECOA does. And the clock is shorter: one year, not five. I’ve written about how MHRA claims die on the calendar, and that’s doubly true when someone spends the first six months waiting on a federal agency that, by its own report, isn’t taking these cases.
And you can’t double-dip on money. Section 1691d(e) says that where the same conduct violates ECOA and state law, the borrower may sue “to recover monetary damages either under this subchapter or under such State law, but not both.” That’s a choice to make early, and I’ve laid out what that choice costs in a discrimination case.
Does Minnesota law recognize disparate impact in credit?
The statute’s text answers part of this, and only part.
Chapter 363A has exactly one burden-shifting disparate-impact framework, and it’s for employment. Section 363A.28, subdivision 10, titled “Disparate impact cases in employment”, shifts the burden once a plaintiff shows “an employment practice is responsible for a statistically significant adverse impact on a particular class of persons protected by section 363A.08, subdivision 2”. A few other provisions reach effects without intent, and none of them is about credit. A public accommodation can’t use standards or criteria “that have the effect of discriminating on the basis of disability”, § 363A.11, subd. 2(4)(i). The definition of “program access” requires the absence of criteria that “have the effect of subjecting qualified disabled persons to discrimination on the basis of disability,” § 363A.03, subd. 33. And the chapter won’t validate age requirements “which have a disproportionate impact on persons of any class otherwise protected by section 363A.08 or 363A.13.” § 363A.20, subd. 6(b). Credit has no counterpart. Section 363A.16 uses the words “discriminate . . . because of”, and that’s all.
So I won’t tell you Minnesota writes an effects test into its credit statute. It doesn’t. What I will tell you is that whatever § 363A.16 means, the CFPB’s rewrite of Regulation B didn’t change a word of it. A federal agency’s view of a federal statute doesn’t construe a Minnesota one. The chapter tells Minnesota courts how to read it: “The provisions of this chapter shall be construed liberally for the accomplishment of the purposes thereof.” § 363A.04. And it says its remedies “are in addition to, and shall not preclude, those available at law or in equity.” Id.
There’s also a state enforcer who doesn’t answer to the Bureau. Under § 363A.28, subd. 2, “[w]henever the commissioner has reason to believe that a person is engaging in an unfair discriminatory practice, the commissioner may issue a charge”. A borrower can also go straight to district court under § 363A.33, subd. 1. Housing finance has its own overlapping protections, which I covered in Minnesota’s fair housing statute, along with the Supreme Court’s Fair Housing Act disparate-impact case. The Bureau’s own rule says the FHA is untouched.
The gap between a report and a statute
Strip the adjectives out of the 2025 report and here’s what’s left. One federal agency stopped bringing a kind of case. It closed the investigations and ended the orders that rested on that theory. It rewrote its regulation to say Congress never authorized the theory, and the rule took effect July 21, 2026.
Here’s what didn’t happen. Congress didn’t amend § 1691. Under Loper Bright, no court has to take the Bureau’s word for what § 1691 means. And the Bureau’s own rule says it has “neither the authority nor expertise to instruct regulated entities on how to comply with” state laws that include a disparate-impact component.
If you were denied credit, or offered worse terms, and the reason doesn’t add up, the federal enforcement picture is grim and the federal statute is still standing. Minnesota’s statute never left. An agency can change what it enforces. It can’t change what the law says.
Madgett Law, LLC represents Minnesota consumers in credit disputes, including credit-reporting errors through our Credit File Corrections practice, debt-collection abuse, and discrimination claims under the Minnesota Human Rights Act. If a lender’s decision doesn’t add up, send us a message or call 612-470-6529.
Sources: Consumer Financial Protection Bureau, Fair Lending Report of the Consumer Financial Protection Bureau for 2025 (Sept. 2026; posted Oct. 1, 2026), at 2 (focus “on proven, intentional racial discrimination with actual identifiable victims”), 4 (§ 2.1, termination of disparate impact in supervision and enforcement; closure of exams and investigations; termination of orders; description of Executive Order 14281), 10 (§ 4.1, no supervisory activities initiated or fair lending violations cited; exam focus on “direct evidence of intentional discrimination”), 11 (§ 4.2, no referrals to DOJ under § 1691e(g)), 15 (§ 5.1.3, stated rationale for the Regulation B amendment), and 22 (§ 8.1.1, no public ECOA enforcement actions by any federal agency in 2025). Equal Credit Opportunity Act (Regulation B), Final Rule, 91 Fed. Reg. 21620 (Apr. 22, 2026), at 21620 (effective date July 21, 2026), 21621 (prior § 1002.6 “effects test” text; Supreme Court has not examined disparate impact under ECOA), 21625 (Loper Bright cited in the proposal), 21635 (courts of appeals “assumed without deciding”), 21637 (Bureau lacks authority over other federal or state disparate-impact laws), 21660 (expected reduction in enforcement actions and private claims), 21661 (covered persons remain subject to the FHA and state laws), 21668 (amended 12 C.F.R. § 1002.6(a)), and 21670 (revised comment 6(a)-2). 15 U.S.C. § 1691(a) (prohibited bases); § 1691d(e) (election of remedies between ECOA and state law) and (f) (state credit-discrimination laws preserved; Bureau’s authority to determine inconsistencies; greater-protection rule); § 1691e(a) (actual damages), (b) (punitive damages caps), (c) (equitable and declaratory relief), (d) (costs and attorney’s fees), (e) (good-faith conformity defense), (f) (five-year limitations period), and (g) (mandatory referral to the Attorney General) — Cornell Legal Information Institute. Loper Bright Enterprises v. Raimondo, 603 U.S. 369 (2024), slip op. at 35 (independent judgment; no deference because a statute is ambiguous), from the Supreme Court of the United States. Minn. Stat. § 363A.03, subd. 33 (“program access” definition); § 363A.04 (liberal construction; remedies cumulative); § 363A.11, subd. 2(4)(i) (public accommodations: criteria with “the effect of discriminating on the basis of disability”); § 363A.20, subd. 6(b) (age requirements with a disproportionate impact); § 363A.16, subds. 1–3 (credit discrimination); § 363A.28, subd. 2 (commissioner’s charge), subd. 3(a) (one-year limitation), and subd. 10 (disparate impact cases in employment); § 363A.33, subd. 1 (civil action in district court), subd. 6 (jury trial), subd. 7 (attorney’s fees), and subd. 8(a) (compensatory damages up to three times actual, punitive damages under § 549.20, civil penalty) — Minnesota Office of the Revisor of Statutes.
This article is general legal information about Minnesota and federal law, not legal advice, and reading it does not create an attorney–client relationship. It describes a federal agency’s report and rule and the published text of statutes; it does not predict how any court would rule on any particular lending decision or set of facts. No outcome is promised or implied.