Managing Fair Lending Risk in the Digital Age
Author: R. Andrew Arculin.; Paula Vigo Marqués.; Daniel Funaro.
Source: Volume 38, Number 09, September 2020 , pp.93-98(6)
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Abstract:
The growing use of innovations in machine learning, artificial intelligence (“AI”), and alternative data are raising new fair lending risks for lenders. The authors address such risks, beginning with the use of the data, followed by an overview of fair lending laws and enforcement. They then turn to protocols for lenders to carefully consider to avoid fair lending violations when developing and using AI/machine learning models that use alternative data.Keywords: Automated Decisioning Algorithms; Anti-Discrimination Laws; Machine Learning-Based Discrimination; AI Risk and Lending Models
Affiliations:
1: Blank Rome LLP; 2: Blank Rome LLP; 3: Blank Rome LLP.