After nearly a decade of litigation, Judge Beryl A. Howell of the U.S. District Court for the District of Columbia has approved the Consumer Financial Protection Bureau’s $6.0 million settlement of class claims of alleged discrimination by the CFPB against 85 Black and Hispanic employees. The class consists of all “minority employees and women who work or worked as Consumer Response Specialists and have been subjected to and harmed by the Bureau’s agency-wide pattern or practice of discrimination and retaliation and discriminatory policies and practices,” according to the complaint. The settlement fund will be distributed to the 85 class members. In addition to the $6.0 million settlement fund, the settlement provides for an award of $1.5 million in attorney’s fees for class counsel.
The class action lawsuit was filed in 2018 against the CFPB’s former Acting Director Mick Mulvaney. Class representatives alleged that they were consistently paid less than their White male colleagues, unfairly denied promotions since 2011, and faced retaliation for making discrimination complaints.
The CFPB does not admit wrongdoing as part of the settlement. In a statement, the CFPB said it remains committed to ensuring all employees are treated fairly. The CFPB recently updated its pay structures, but advised that the compensation reform is independent of the discrimination allegations.
We view as ironic that the CFPB, which has been vigorously, and sometimes zealously enforcing fair lending laws, would be sued for employee discrimination and pay out $6.0 million in damages and $1.5 million in attorney’s fees. The optics are not very pleasant.