Letter to the Hon. Ben Carson, Secretary of the U.S. Department of Housing and Urban Development - In Public Comments to Proposed Rule, Booker Blasts HUD for Eroding Fair Housing Act Protections

Letter

Dear Secretary Carson:

I am writing to express my opposition to the U.S. Department of Housing and Urban Development's (HUD) proposal to amend the Fair Housing Act's (FHA) disparate impact standard, which would erode federal protections for victims of housing discrimination. Not only does the proposed rule strip away existing protections for some of the most vulnerable populations in our country, but it also removes critical safeguards on emerging technologies. In particular, regarding the use of models and algorithms, the new guidance significantly undermines FHA protections while disregarding the mechanics of machine learning. As financial institutions, landlords, and other housing providers increasingly rely on the use of algorithmic decision making, this proposal weakens protections for consumers, instead of ensuring industries adhere to best practices as they implement new technologies.

Although I share HUD's desire to increase access to credit to underserved communities, this proposal essentially makes lenders and landlords using algorithmic models exempt from the disparate impact standard. This burden-shifting framework establishes lines of defense for accused violators of the FHA that are fundamentally flawed and demonstrate a lack of understanding of how machine learning technologies work.

First, under the proposal, a defendant need only demonstrate that their inputs in a model or algorithm are not a protected characteristic, or a substitute for a protected characteristic, in order to dismiss an accusation of a FHA violation.[1] However, it is well established that algorithmic bias rarely stems from a single protected characteristic or a substitute, but, rather, arises from incomplete data sets and historic human biases[2]. There are countless examples of this[3], not the least of which was HUD's own decision to sue Facebook for housing discrimination earlier this year.[4] Despite the fact that Facebook removed suspect categories from its menu items, recent research indicates that the algorithmic model in the ad delivery system itself was also responsible for bias in delivering housing advertisements.[5] This shows that HUD should delve deeper into the mechanics of the decision making tools used by lenders, landlords, and realtors in order to determine whether these tools cause a disparate impact. HUD's position in the Facebook case is plainly inconsistent with the proposed rules.

Second, the proposal removes liability from offenders by shifting responsibility to the third party that provides the decision making tool. Should a bank or rental company engage in unfair practices through a biased algorithm, no party would be held accountable. Allowing lenders, landlords and realtors to outsource the liability for housing discrimination ensures they will ignore discriminatory outcomes and actually incentivizes them to avoid asking their vendors questions. Rather than absolving housing stakeholders from responsibility, HUD should be encouraging actors to take steps to address biases. In the Algorithmic Accountability Act, which I recently introduced with Senator Ron Wyden and Congresswoman Yvette Clarke, we outline methods with which the federal government can mitigate the impacts of biased and discriminatory algorithms. HUD should require housing providers to adopt these policies, which include third party audits of algorithmic systems that study impacts on accuracy, fairness, bias, discrimination, privacy, and security.

Should the administration enact the proposed rule, millions of Americans could be subject to housing discrimination without recourse. At a time when the country faces an affordable housing crisis[6], the proposal not only weakens the federal government's ability to execute the Fair Housing Act, but could potentially perpetuate biased algorithmic decision making across industries. I urge you to reconsider and rescind this proposal, and I appreciate your consideration of my request.

Sincerely,

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