Texas Judge Blocks Fair Lending Rules

(TotalConservative.com) – A conservative Texas judge is blocking the implementation of Biden administration rules which would change how lenders make loans available to the public and businesses. The rules are specific for low and moderate income earners. The ruling prevented implementation of the new rules which were slated to go into effect on Monday, April 1.

Judge Matthew Kacsmaryk in Amarillo, Texas agreed with industry representatives including the U.S. Chamber of Commerce and American Bankers Association that the new rules violate the 1977 Community Reinvestment Act. That law was specifically crafted to prevent red-lining: a discriminatory lending practice which only made funds available for certain ethnic or racial groups in eras past.

The rules were updated last year which broadened the geographical areas covered under a specific lender. A change that regulators claimed accounted for the changes in the banking industry with more digital banking and less focus on local branches serving their immediate communities.

Kacsmaryk ruled that the changes went beyond the scope of the 1977 law; he said that the impact would also tweak retail lending and granted regulators new powers to scrutinize deposit products which are well-outside the scope of the law cited. He highlighted how scrutiny of retail lending was a completely new authority.

Kaczsmaryk has been criticized as being conservatively biased; he was the judge which approved a ban on the abortion drug mifepristone. The ban was temporarily halted while the appeals process plays out. That case was argued before the Supreme Court on Tuesday, March 26, with many judges asking questions that suggested they were skeptical about a ban on the drug.

A new policy was adopted by the U.S. Judicial Conference which makes policy for judiciaries around the country. The discretionary policy change should make the assignment of judgements more random, preventing the potential for litigants to shop their cases around to smaller jurisdictions with only one judge, as is the case in Amarillo.

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