These documents are not legal documents but are placed here for reference purposes only. For a legal copy please contact the department.

Non-Discrimination in Financial Services

Monday, January 1, 1990


Effective January 1, 1990


1.1 This Regulation is issued by the Department of Banking and Insurance pursuant to authority granted by 8 V.S.A. section 75, 8 V.S.A. subsection 1211(b) and 3 V.S.A. subsection 831(a).

1.2 This Regulation applies to all financial institutions offering personal and/or commercial credit services in Vermont.

1.3 The purpose of this Regulation is to implement 8 V.S.A. section 1211, entitled "Prohibition on discrimination based on sex, marital status, race, color, religion, national origin, age or handicapping condition". A specific purpose is to identify requirements of the Vermont law which supplement Federal Regulation B, Equal Credit Opportunity, as revised effective December 16, 1985 (12 CFR 202).


The definitions set forth in 8 V.S.A. subsection 1211(c) apply to this Regulation.


3.1 A financial institution shall not discriminate against an applicant on a prohibited basis regarding any aspect of a personal or commercial credit transaction.

3.2 Prohibited bases are gender, marital status, race, color, religion, national origin, age or handicapping condition.

3.3 Within 30 days of reaching a decision on a completed application, a financial institution shall notify the applicant of its decision on the application.

3.4 Each applicant against whom adverse action is taken shall receive a written statement of reasons for such action from the financial institution.

(a) A financial institution may not provide a written disclosure of the right to a statement of reasons in lieu of providing an actual statement, as is permitted by 12 CFR section 202.9 (a)(2).

(b) A financial institution may not comply with sub-section 3.4 herein by providing a statement of reasons only upon request by the applicant as is permitted by 12 CFR section 202.3 (d)(3)(i).

3.5 For commercial credit only, a statement of reasons meets the requirements of subsection 3.4 herein only if it contains the specific reasons for adverse action taken, and cites the specific documentation or business judgment which supports the adverse decision on the application.

(a) "Documentation" includes, but is not limited to, all borrower supplied external documents, credit reports, appraisals, business or market projections, demographic data, tax returns, financial history, business records or government surveys and reports.

(b) "Business Judgment" includes any subjective method of evaluation used in lieu of or in addition to an empirically derived, demonstrably and statistically sound, credit scoring system.

3.6 Financial institutions shall maintain a copy of all "statements of reasons" and the documentation upon which the decision was based for one calendar year after the date of issuance, notwithstanding the requirement of 12 CFR 202.3 (d)(3)(ii). Financial institutions shall provide copies of these statements and documents to the Department within five (5) working days of request for same.


4.1 A financial institution that discriminates against an applicant in violation of section 1211 of 8 V.S.A. shall be liable to the applicant for punitive damages, actual damages sustained by the applicant as a result of the discrimination, for costs and a reasonable attorney's fee as determined by the court.

4.2 The civil enforcement provision of subsection 4.1 herein shall be in addition to any other applicable penalty provisions of Vermont law.

Gretchen Babcock , Commissioner