U.S. Senator Kevin Cramer (R-ND) joined his colleagues on the Senate Banking, Housing, and Urban Affairs Committee in a letter to Attorney General Merrick B. Garland and Director of the Consumer Financial Protection Bureau (CFPB) Rohit Chopra, expressing concerns regarding the October 12, 2023 joint statement by the CFPB and the U.S. Department of Justice (DOJ). The statement warned financial institutions the consideration of immigration status in loan applications may be a violation of the Equal Credit Opportunity Act (ECOA).

The senators urged Attorney General Garland and Director Chopra to retract the agencies’ irresponsible joint statement and instead endorse risk-based lending practices which promote safety and soundness in the bank sector.

“The CFPB and DOJ’s joint directive not only flies in the face of responsible lending standards, risk-based pricing, and sound risk management, but also contradicts and rewrites decades worth of guidance from the CFPB and the federal banking regulators—all without an official rulemaking pursuant to the Administrative Procedures Act (“APA”), giving financial institutions the chance to comment, or even offering any other semblance of advanced notice,” wrote the senators. “We are also concerned that the CFPB and DOJ’s joint statement appears to be at odds with the official guidelines for various federal lending programs, many of which require U.S. citizenship or permanent residency to qualify.”

“While the CFPB and DOJ’s joint statement conflicts with decades of immigration status-related guidance from the CFPB and the Fed, it also poses serious risks to financial stability— encouraging financial institutions to ignore critical dispositive factors in their calculation of risk. Additionally, the fact that your agencies moved forward with this guidance outside of the APA rulemaking process, and without any advanced communication or feedback from industry, raises even more concerns,” the senators continued.

Additional cosigners include U.S. Senators JD Vance (R-OH), Tim Scott (R-SC), Mike Crapo (R-ID), Mike Rounds (R-SD), Thom Tillis (R-NC), John Kennedy (R-LA), Bill Hagerty (R-TN), Cynthia Lummis (R-WY), Katie Boyd Britt (R-AL), and Steve Daines (R-MT).

Click here to read the letter.