Beginning in the mid-1960s, U.S. consumer and civil rights activists sought to turn an unlikely arm of the federal administrative state to their causes: bank supervision. Fighting against long-standing racial and gender discrimination in banking and in favor of new financial safety measures like price and credit score disclosure, these activists won a string of Congressional victories in the late 1960s and early 1970s, including the Fair Housing Act (1968), the Truth-in-Lending Act (1968, with amendments in 1970), the Fair Credit Reporting Act (1968), the Equal Credit Opportunity Act (1974, with amendments in 1976), and many others. Collectively, these laws made federal bank supervisors—the Comptroller of the Currency, the Federal Deposit Insurance Corporation, and the Federal Reserve—responsible for ensuring that the nation’s banks complied with new consumer protection and anti-discriminatory provisions. Bank supervisors balked at these novel responsibilities. To that point, federal banking officials had worked to ensure banks remained solvent and stable; they feared consumer protection and antidiscrimination mandates would interfere with what they understood as more important work.
Recently, historians have focused significant attention on the legislative victories won by consumer and civil rights groups to make finance more equitable and accessible, but scholars have not yet examined the implementation of these laws. Through close examination of supervisory archives and congressional records, this paper shows that federal supervisors focused most of their attention on helping banks comply with consumer protection laws, in order to protect banks from private consumer lawsuits that could threaten their solvency. Because anti-discrimination laws lacked effective private enforcement provisions, federal supervisors made little meaningful effort to establish patterns of racial discrimination within financial institutions. Over time, civil rights and antidiscrimination laws became subsumed under the larger framework of consumer protection, further weaking an already waning federal commitment to financial equity.