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Regulations and Examinations

Compliance Training Program - Introduction to Fair Lending School

Last Updated: February 3, 2023

Program Overview

The Introduction to Fair Lending School addresses:

  • The two fair lending statutes (Equal Credit Opportunity Act and Fair Housing Act),
  • How to use the Interagency Fair Lending Examination Procedures to conduct a fair lending review, and
  • How to document a fair lending review in the Fair Lending Scoping and Conclusions (FLSC) memorandum.

The course consists of lessons, group exercises, and a case study meant to prepare a pre-commissioned examiner to conduct an effective and efficient small bank fair lending review and write a FLSC memorandum.

Skills Taught

By the end of this course, students will have been taught how to:

  • Risk scope the underwriting, steering, pricing, redlining, and marketing portions of a fair lending review
  • Apply the risk scoping guidelines
  • Determine the focal point (product, market, decision center, and target/controls groups, otherwise known as PMCG) based on the risk profile analysis
  • Conduct a comparative file analysis using benchmarks and overlaps
  • Evaluate management's responses to apparent differences in treatment
  • Conduct a fair lending review for a small institution
  • Write a FLSC memorandum

Duration and Format

This course contains:

  • 24 hours of Pre-course Work
  • 1 week Facilitated classroom discussion/lectures
    • Small group activities
    • In-class case study

Level and Credits

Basic
Continuing Education Unit (CEU): 3.3
Continuing Professional Education Unit (CPE): 39.0

Target Audience

FDIC participants should attend in accordance with the parameters outlined in the Examiner Training and Development Policy.  State Banking Authority participants should have 11-15 months of experience in compliance examinations.  This course is open to appropriate staff of the FDIC and partner government regulatory agencies. This course is not open to the public or staff of private banks.

Prerequisites and Prior Work Experience

Prior to attending the course, participants must have completed and have a working knowledge of the following:

  • Assisted in or conducted two fair lending reviews – including interviews and preparation of the Fair Lending Scoping and Conclusions (FLSC) memorandum
  • Completed the pre-course assignment
    • Complete two BAI computer-based instruction (CBI) courses. It is critical that you complete the required courses; however, if you have previously completed any of these BAI courses as part of your FDIC training, then there is no need to complete it again.
    • Complete one FDIC CBI course
    • Review case study documents to complete the case study bank FLSC Section 1 review. Participants receive the IFLS Case Study information in IFLS Office 365 SharePoint about eight weeks prior to the start of the session.

Pre-Course Assignment

The items below constitute the pre-course assignment.  The pre-course assignment is due in general two weeks/11 business days prior to the start of the session.  The exact date the work is due for any given session is specified in the pre-course information sent approximately two months prior to the start date.  Prior to attending the course, participants are required to complete and submit the following pre-course assignments:

  • Complete two BAI computer-based instruction (CBI) courses. It is critical that you complete the required courses; however, if you have previously completed any of these BAI courses as part of your FDIC training, then there is no need to complete it again.
  • Complete one FDIC CBI course
  • Review case study documents to complete the case study bank FLSC Section 1 review. Participants receive the IFLS Case Study information in IFLS Office 365 SharePoint about eight weeks prior to the start of the session.

NOTE: The Division of Depositor and Consumer Protection (DCP) has authorized 24 hours of official time to complete the pre-course assignment.

Post Course Recommendation and Feedback

The participant Summary Evaluation Form (SEF), sent approximately thirty days after the conclusion of the school, will summarize the students performance at the course.

Key Topics Covered

  • Apply the Interagency Fair Lending Examination Procedures to conduct the fair lending review for the small non-complex case study bank
  • Document the case study bank fair lending review in the FLSC memorandum:
    • Section 1 Develop an Institution Overview:  During pre-course, participants use case study information to draft the scoping, underwriting, steering, pricing, redlining, and marketing portions of the FLSC Section 1.  During the course, they update the draft after course content which covers each area.
    • Section 2 Identification of Discrimination Risk Factors:  Participants use case study information to determine if there is residual risk in any area to warrant the selection of one or more potential focal points to consider for an in-depth analysis.
    • Section 3 Description of Potential Focal Points:  Participants use case study information to determine the focal point (product, market, decision center, and target/controls groups, otherwise known as PMCG) based on the risk profile analysis.
    • Section 4 Description of Focal Point Analysis:  Participants use case study information to conduct a comparative file analysis using benchmarks and overlaps.  They also evaluate management's responses to apparent differences in treatment.
    • Section 5 Fair Lending Conclusions and Recommendations:  Participants summarize the overall conclusions of the case study fair lending review and describe any findings.

More Information

CPE Credit logoFor information regarding administrative policies such as complaints and refunds, please contact Corporate University, Attn: NASBA Representative Ava Livas, Room A-3025, 3501 North Fairfax Drive, Arlington, VA 22226 (703) 562-2463.

The Federal Deposit Insurance Corporation is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: NASBARegistry.org

IACET logoThe Federal Deposit Insurance Corporation (FDIC) is accredited by the International Association for Continuing Education and Training (IACET) (www.iacet.org). The FDIC complies with the ANSI/IACET Standard, which is recognized internationally as a standard of excellence in instructional practices. As a result of this accreditation, the FDIC is accredited to issue the IACET CEU.

For more information concerning course content and administration, please contact Judy Long or Sonya Staples.