NCUA Q&As – Can credit unions self-test their fair lending compliance program?

Compliance > Lending > Fair Lending
Q:   Can credit unions self-test their fair lending compliance program?
A:  Yes.  Regulation B defines a “self-test” as any program, practice, or study that: (i) is designed and used specifically to determine the extent or effectiveness of a creditor's compliance with the Act or this regulation; and (ii) creates data or factual information that is not available and cannot be derived from loan or application files or other records related to credit transactions.  12 CFR § 1002.15(b)(1).  Under the Fair Housing Act, self-testing includes, but is not limited to, using fictitious credit applicants (testers) or conducting surveys of applicants or customers, nor is it limited to the pre-application stage of loan processing. 24 CFR § 100.141.  
Management must understand that corrective action is required when a self-test shows that it is more likely than not that a violation has occurred, even though no violation has been formally identified through an examination or supervision contact.  12 CFR § 1002.15(c).
This Q&A was obtained from NCUA’s website, in a document entitled “NCUA Fair Lending Examination and Compliance Program for Federal Credit Unions,” which may be found here: 

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