The Consumer Financial Protection Bureau (CFPB) has issued an interpretive rule to clarify that, with respect to any aspect of a credit transaction, the prohibition against sex discrimination in the Equal Credit Opportunity Act (ECOA) and Regulation B, which implements ECOA, encompasses sexual orientation discrimination and gender identity discrimination, including discrimination based on actual or perceived nonconformity with sex-based or gender-based stereotypes and discrimination based on an applicant’s associations.
The CFPB has determined that under ECOA and Regulation B: (1) sexual orientation discrimination and gender identity discrimination necessarily involve consideration of sex; (2) an applicant’s sex must be a “but for” cause of the injury but need not be the only cause; and (3) discrimination against individuals, and not merely against groups, is covered. The CFPB has also clarified that ECOA’s and Regulation B’s prohibition against sex discrimination encompasses discrimination motivated by perceived nonconformity with sex-based or gender-based stereotypes, as well as discrimination based on an applicant’s associations.