WASHINGTON — A Trump-aligned legal group is pushing the White House to do away with a requirement that home lenders collect data on the race and sex of mortgage applicants.
America First Legal (AFL), founded by White House Deputy Chief of Staff Stephen Miller, is decrying the rule as a racial “surveillance tool” and urging the Trump administration to restore “colorblind” lending policies.
Currently, if mortgage applicants do not provide their race, sex and ethnicity, lenders are required to record it based on their observations.
The rule, enforced by the Consumer Financial Protection Bureau (CFPB), “turns mortgage applications into a government-mandated demographic sorting exercise,” AFL attorney Alice Kass said in a statement.
“These policies exceed the CFPB’s authority and compel the collection of protected personal information without legal justification.”
President Trump’s team has repeatedly tried to abolish and scale down the CFPB, but federal courts have so far rejected their attempts to do so.
AFL petitioned the CFPB Jan. 12 to scrap the rule entirely. On Wednesday, it formally asked the White House Office of Information and Regulatory Affairs (OIRA) to end its approval of the rule, which has its origins in the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.
The White House has sway over federal disclosure rules under the Paperwork Reduction Act of 1980, which gives administrations the power to scrap regulations deemed to impose too much of a paperwork burden on Americans.
OIRA can either narrow the scope of the rule or get rid of it completely, according to American First Legal.
The Trump-aligned group believes that recent Supreme Court decisions, such as Students for Fair Admissions v. Harvard, justify its push to end race and sex data collection.
Additionally, Trump signed an executive order last year directing his administration to pursue colorblind regulatory policies.
“Government bureaucrats use [the rule] to justify policing mortgage lenders for failing to balance their books based on race and sex,” America First Legal wrote in its petition.
“[The rule] is essentially a surveillance tool that pressures lenders to compromise between doing business with reliable borrowers and selecting borrowers to meet government-mandated race and sex balancing,” the group added.
“This burden stifles free enterprise and prioritizes social engineering over merit-based lending.”
