THE EQUAL CREDIT OPPORTUNITY ACT (ECOA) is a United States law (codified at 15 U.S.C. § 1691 et seq.), enacted October 1974, that
makes it unlawful for any creditor to discriminate against any
applicant, with respect to any aspect of a credit transaction, on the
basis of race, color, religion, national origin, sex, marital status, or
age (provided the applicant has the capacity to contract); the
applicant's use of a public assistance program to receive all or part
of their income; or the applicant's previous good-faith exercise of any
right under the Consumer Credit Protection Act.
Technically,
women won the right to open a bank account in the 1960s, but many banks
still refused to let women do so without a signature from their
husbands. This meant men still held control over women’s access to
banking services, and unmarried women were often refused service by
financial institutions.
The Equal Credit
Opportunity Act prohibited financial institutions from discriminating
against applicants based on their sex, age, marital status, religion,
race or national origin. Because of the act’s passage, women could
finally open bank accounts independently.
The law applies
to any person who, in the ordinary course of business, regularly
participates in a credit decision, including banks. retailers, bankcard
companies, finance companies, and credit unions.
The part of the law that defines its authority and scope is known as Regulation B, that appears in Title 12 part 1002's official identifier: 12 C.F.R. § 1002.1(b) (2017). Failure
to comply with Regulation B can subject a financial institution to
civil liability for actual and punitive damages in individual or class
actions. Liability for punitive damages can be as much as $10,000 in
individual actions and the lesser of $500,000 or 1% of the creditor's
net worth in class actions.
Before the
enactment of the law, lenders and the federal government frequently and
explicitly discriminated against female loan applicants and held female
applicants to different standards from male applicants. A
large coalition of women's and civil rights groups pressured the
government to pass the ECOA (and the Housing and Community Development
Act of 1974) to prohibit such discrimination.
I hope it gives
all of us pause to understand this is a mere 50 years ago. Something
that occurred within the lifetimes of many of us. And along with other
rights most of us take for granted, are under siege. VOTE VOTE VOTE
(another right women only achieved 100 years ago.)
