In today’s economic and political climate, regulatory agencies, law enforcement officials and consumer-advocacy groups are combining forces to focus attention on potential discriminatory lending practices in the financial services industry. Among other indicators of this heightened scrutiny, an increasing percentage of regulatory agency examinations are leading to Department of Justice (DOJ) actions or other sanctions. For financial institutions and other loan originators, a positive reputation is not the only asset at stake; when allegations of fair lending violations arise, institutions may also find themselves under threat of significant civil monetary, restitution and other penalties.

The lawyers of Hunton Andrews Kurth’s fair lending practice have years of experience helping clients address challenges to their loan activities, policies and procedures. We understand that agency examinations and subsequent enforcement actions are not isolated events, and that information arising from one investigation may also be used by other parties to their advantage in related disputes. Our integrated team of regulatory lawyers and litigators helps clients stay abreast of emerging issues; minimize exposure; and resolve claims of improper activity at each of the three key steps in the investigation process:

• First stage: agency examinations. We advise clients in Consumer Financial Protection Bureau, Federal Deposit Insurance Corporation, Office of the Comptroller of the Currency, Housing and Urban Development, Federal Reserve Board, National Credit Union Administration and other agency examinations, including development and implementation of strategies designed to increase regulatory compliance and reduce risk. We counsel clients on a broad range of issues — such as marketing practices, lending discrimination, redlining and reverse redlining, foreclosure, modification and servicing practices and loan pricing, as well as implications often raised under Unfair, Deceptive or Abusive Acts or Practices (UDAAP), and a host of other related concerns — and help the institution respond to requests for data and employees prepare for interviews with examiners.
• Second stage: “15-day” letters. We craft coordinated responses to agency findings and referrals to the DOJ, often stopping administrative actions before unnecessary corrective steps are required or penalties are assessed. We regularly draw on our network of industry experts and consultants, including economists and statisticians, to refute or correct inaccurate or outdated information upon which initial findings have been based, and to convince regulators to forgo pursuit of civil monetary penalties.
• Third stage: DOJ proceedings and civil litigation. When matters are referred to the DOJ or in the event of a private civil suit, we provide a rigorous defense in federal and state courts across the country. We have resolved numerous DOJ investigations on favorable terms and on a number of occasions have convinced the DOJ to decline prosecution. In situations in which clients have declined to defend DOJ actions, we have crafted arrangements that have mitigated the ramifications of such issues. When fair lending complaints have been pursued by consumer-advocacy and other groups, we have helped many clients avoid litigation.

Our lawyers are among the most experienced in the financial services sector. We understand all sides of the issues at hand; in addition to having represented clients in hundreds of matters, our team includes a former Assistant US Attorney and other lawyers with insight into the evolving priorities of regulatory and law enforcement officials. Members of the fair lending team have been named among the top corporate, finance and banking lawyers and litigators in the country by such publications as American Banker, Chambers USA and SNL Financial; regularly publish articles in leading legal and industry journals; and are frequently sought as speakers at conferences and seminars across the country.

Experience

• Addressed over a dozen referrals to the Department of Justice (“DOJ”) involving fair lending and other issues since 2010, most of which did not result in any formal enforcement action by either the DOJ or the prudential regulators
• Negotiated an agreed order with the DOJ involving relatively modest restitution despite retention after DOJ referral and analysis by bank’s consultant showed disparate pricing
• Represented client in connection with its decision to bring cause of action challenging the constitutionality of the Dodd-Frank Act
• Defended scores of financial institutions in connection with adverse compliance examinations, including over two dozen involving Regulation B, ECOA and FHA since 2010
• Addressed what is believed to be the first Real Estate Settlement Procedures Act (“RESPA”) action pursued after the advent of the Consumer Financial Protection Bureau (“CFPB”)
• Addressed a number of examination findings involving multiple bank regulatory agencies alleging unfair, deceptive or abusive acts or practices (“UDAAP”)
• Regularly conduct internal investigations and policy reviews of financial institutions relating to fair lending and compliance matters
• Conducted a number of presentations regarding compliance with the fair lending laws and other regulatory hot-button issues for the Bank CEO Network, Independent Community Bankers of America, Western Independent Bankers, Louisiana Bankers Association, North Carolina Bankers Association, Florida Bankers Association, among others

• Addressed over two dozen referrals to the DOJ involving fair lending and other issues since 2010, most of which did not result in any formal enforcement action by either the DOJ or the prudential regulators.
• Negotiated an agreed order with the DOJ involving relatively modest restitution despite retention after DOJ referral and analysis by bank’s consultant showed disparate pricing.
• Defended scores of financial institutions in connection with adverse compliance examinations, including dozens involving Regulation B, ECOA and FHA since 2010.
• Addressed a number of examination findings involving multiple bank regulatory agencies alleging UDAAP, including convincing such authorities to refrain from prosecuting in 12 straight matters.