Chicago Lender Says CFPB's Redlining Suit Goes Too Far
By Lauraann Wood (October 26, 2020, 8:58 PM EDT) -- A Chicago-area mortgage lender argued Friday that the Consumer Financial Protection Bureau is going beyond its federal authority with a lawsuit alleging that it redlines and disparages majority-Black neighborhoods through infomercial commentary, which the lender says targets constitutionally protected speech.
Townstone Financial Inc. argued in Illinois federal court that the CFPB's lawsuit against it is "flawed" and should be dismissed on the ground that the agency improperly seeks to impose Equal Credit Opportunity Act liability over conduct allegedly targeting prospective mortgage applicants, which the law does not govern.
Townstone also argued that applying the ECOA and its regulatory enforcement mechanism, Regulation...
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