AL 95-8
Subject:  Fair Lending   

TO:  Chief Executive Officers of all National Banks, Department and Division 
     Heads, and  all Examining Personnel


BACKGROUND

For some time, the OCC's Compliance Management Department has been receiving 
inquiries from bankers about OCC referrals and notifications of fair lending 
violations to the Department of Justice (DOJ) and the Department of Housing 
and Urban Development (HUD).  These referrals and notifications are required 
under the Equal Credit Opportunity Act, 15 U.S.C. 1691e, and Executive Order 
12892.


SUMMARY

To answer these questions, the Compliance Management Department is providing 
this updated summary of notifications and referrals made over the past two 
and a half years.   Since April 1993, the OCC has referred to DOJ or notified 
HUD of 20 national banks in violation of fair lending laws.  All the referrals 
and notifications involved either overt discrimination or disparate treatment 
on a prohibited basis.  

Although the OCC's interim procedures guiding the conduct of fair lending 
examinations focus on examining for discrimination in residential lending on 
the bases of race and national origin, fair lending laws prohibit 
discrimination in all credit products and on a number of bases.  Accordingly, 
national bank examiners are alert to the possibility of discrimination in
any loan product and on any prohibited basis. Of the 20 referrals and 
notifications made by the OCC, eight involved residential real estate loan 
transactions and twelve involved consumer loan transactions.
 








Additionally, of the 20 referrals and notifications made by the OCC:

o    Seven involved discrimination on the basis of marital status,
o    Six involved discrimination on the basis of race,
o    Four involved discrimination on the basis of age,
o    One involved discrimination on the basis of national origin,
o    One involved discrimination on the bases of sex and marital status, and
o    One involved discrimination on the bases of sex and familial status.


While DOJ and HUD have pursued, or are currently pursuing, several of the OCC's 
referrals and notifications, in most cases, these enforcement agencies have 
asked the OCC to attempt to resolve the violations administratively.  
Specifically:

     Fourteen cases were resolved administratively by the OCC after being 
     returned by the enforcement agency, which agreed with the OCC's findings;

     One case resulted in a simultaneous complaint, consent decree, and 
     consent order between DOJ, the OCC, and the national bank;

     One case resulted in a simultaneous complaint and consent decree between 
     DOJ and the national bank;

     One case is currently pending investigation by both DOJ and HUD;

     One case is currently pending investigation by the DOJ;

     One case is currently pending investigation by HUD;

     One case was returned by DOJ to the OCC and then forwarded to the Federal 
     Reserve for administrative resolution of the violation following the 
     bank's conversion from a national to a state charter.




QUESTIONS

Attached are more detailed summaries of these cases.  We hope this 
information will prove helpful to national banks.  For further information, 
please contact Russ Bailey, Larry Riedman or Karen Weinstock in Compliance 
Management at (202) 874-4446.




                                           
Stephen M. Cross
Deputy Comptroller for
   Compliance Management

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