Rights & Ethics
Adverse Action
Denial or unfavorable decision based on consumer information.
Definition
A decision to deny credit, employment, or insurance, or take other unfavorable action against a consumer based on information in a consumer report. Requires disclosure and explanation to affected individuals.
Sources
- •FCRA
- •ECOA
Related Terms
Consumer Report
Information used for credit, employment, or insurance eligibility....
significant adverse effect
Materially consequential negative outcome from an automated decision....
Material decisions
Outcomes with direct substantial impacts on customers....
Unfair Discrimination
Practices where AI systems lead to biased or inequitable treatment of consumers without legitimate grounds....
Material Decision
Outcome with direct and substantial impact on a customer....