Compliance Q&A: Recent UDAAP Changes

Question: Have there been any changes to UDAAP recently? One of our providers has made changes to some of their documentation involving UDAAP and we are wondering if there has been a recent change. 

Answer: Yes, the CFPB recently updated its UDAAP exam procedures for the first time in almost a decade. The main area of change is new authority under UDAAP to address discrimination in connection with non-credit products and services in an effort to address discrimination related to non-credit products. For example, when reviewing internal controls, the updated procedures now include: 1) whether the bank has policies and procedures to review, test, and monitor any decision-making processes for discrimination, 2) whether the bank has policies and procedures to mitigate discrimination that may arise from its decision-making processes, 3) whether the bank’s policies, procedures and practices target or exclude consumers from products and services, or offer different terms and conditions, in a discriminatory manner, and 4) whether the bank has appropriate training to prevent discrimination. The full exam procedures can be found here:

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