LoanDepot algorithm denied mortgage to Black couple in Charlotte
In August 2019, Crystal Marie and Eskias McDaniels, a Black couple, were denied a mortgage for a house in Charlotte, North Carolina, by loanDepot's automated underwriting algorithm. The algorithm rejected the application because Crystal Marie was a contractor, not a full-time employee, despite her high credit score and income. After the couple enlisted their real estate agent and employer to intervene, the lender reversed the decision and cleared them to close. The couple alleged that race played a role in the denial, which loanDepot denied.
- Company involved
- loanDepot
- AI system involved
- Classic FICO and Fannie Mae/Freddie Mac automated underwriting software
10 source articles · read the reporting →
$3.75M HireVue Illinois BIPA class action settlement - Top Class Actions
Collected voice and facial biometrics from job applicants during video interviews without consent
- Company involved
- HireVue Inc.
- AI system involved
- HireVue
1 source article · read the reporting →
Illinois job applicants may get about $150 from HireVue biometric privacy settlement - The Cool Down
Job applicants were subjected to biometric data collection during video interviews without proper consent.
- Company involved
- HireVue
- AI system involved
- HireVue
1 source article · read the reporting →
Facebook settles facial recognition privacy lawsuit for $550 million
Facebook agreed to pay $550 million to settle a class-action lawsuit alleging its Tag Suggestions tool scanned users' faces without consent, violating the Illinois Biometric Information Privacy Act. The case, ongoing since 2015, resulted in a settlement for eligible Illinois users. Facebook later made facial recognition opt-in.
- Company involved
- Facebook
- AI system involved
- Tag Suggestions
1 source article · read the reporting →
Job seeker asks First Circuit to revive class action over AI interviewing tool
Massachusetts financial consultant Mozart Saint Cyr leads a proposed class of job applicants who say JPMorgan Chase's use of HireVue one-way video interviews amounted to a lie detector test banned by state law. After a federal judge dismissed the case, they asked the First Circuit to revive it.
- Company involved
- JPMorgan Chase
- AI system involved
- HireVue one-way video interview
1 source article · read the reporting →
AI Hiring Platform Faces FCRA Class Action Over Data Use | Kistler et al. v. Eightfold AI Inc.
The AI platform screened job applicants, affecting their hiring prospects.
- Company involved
- Eightfold AI
- AI system involved
- Eightfold AI
1 source article · read the reporting →
Class action claims Checkr misreported criminal records in background checks
Checkr's system misreported criminal records belonging to someone else on Natasha Davis's consumer report, impeding her ability to gain employment.
- Company involved
- Checkr Inc.
1 source article · read the reporting →
How Your Shadow Credit Score Could Decide Whether You Get an Apartment - ProPublica
Tenant screening companies assign renters a score drawn from data far wider than credit history, an industry subject to less regulation than credit scoring agencies. ProPublica reports that experts warn these algorithms can decide who gets an apartment on the basis of information applicants cannot see or correct. Kim Fuller was denied a rental application on such a score.
- Company involved
- Habitat America
- AI system involved
- RentGrow
1 source article · read the reporting →
Goldman Sachs Apple Card Algorithm Accused of Gender Bias in Credit Limits
In late 2019, David Heinemeier Hansson alleged on Twitter that the Apple Card underwriting algorithm, operated by Goldman Sachs, gave him a higher credit limit than his wife despite similar financial profiles. The New York Department of Financial Services investigated and found no violation of fair lending laws, but critics argue the audit methodology was outdated and failed to detect proxy discrimination. Apple later updated its credit policy to allow spouses to combine credit files, acknowledging a lack of fairness in industry credit scoring.
- Company involved
- Goldman Sachs
- AI system involved
- Apple Card
6 source articles · read the reporting →
Scammers use AI-generated identities to steal $5.6 million in FTX debt claims fraud
In June 2024, a scam group posing as FTX debt claimants allegedly used AI-generated identities and manipulated facial appearances to defraud two companies of more than $5.6 million. The perpetrators accessed FTX customer data through public bankruptcy filings or a 2023 data breach at Kroll. Blockchain analysis traced the stolen funds through Binance, CoinEx, and Gate.io. The incident remains unresolved.
6 source articles · read the reporting →
Michigan's MiDAS system falsely accused 34,000 of unemployment fraud
Michigan's Unemployment Insurance Agency (UIA) deployed the Michigan Integrated Data Automated System (MiDAS) to automate fraud detection. The system algorithmically adjudicated over 40,000 fraud cases between October 2013 and September 2015, with 85 percent of those resulting in incorrect fraud determinations. The false accusations led to severe financial penalties, ruined credit, and homelessness for many victims. A class-action lawsuit was filed, and while the state has apologised and returned fines, it has fought against compensation claims, though legislators have promised to seek at least $30 million for those affected.
- Company involved
- Michigan Unemployment Insurance Agency
- AI system involved
- Michigan Integrated Data Automated System (MiDAS)
10 source articles · read the reporting →
CFPB Acts Against Hello Digit for Faulty Savings Algorithm Causing Overdrafts
Hello Digit, a fintech company, used an automated savings algorithm that made transfers from consumers' checking accounts, falsely guaranteeing no overdrafts. The algorithm caused customers to incur overdraft fees, and the company often denied reimbursement requests. The CFPB found that Hello Digit engaged in deceptive practices and ordered the company to pay redress to harmed consumers and a $2.7 million fine.
- Company involved
- Hello Digit, LLC
- AI system involved
- Hello Digit app
1 source article · read the reporting →
Schufa's Black-Box Scoring Unfairly Penalises Consumers with Positive Credit Data
An investigation by SPIEGEL and BR Data reveals that Schufa's credit scoring algorithm often assigns poor risk scores to consumers with only positive credit information. One consumer, Sven Drewert, was denied a credit card limit increase despite having no negative entries. The algorithm uses limited data, and its secret formula can lead to arbitrary categorisations, affecting access to loans, phone contracts, and housing. The system's opacity and potential biases raise concerns about fairness and accountability.
- Company involved
- Schufa Holding AG
- AI system involved
- Schufa Score
2 source articles · read the reporting →
Arity collected drivers' data via apps for insurance scores
Popular smartphone apps including Life360, MyRadar and GasBuddy reportedly shared users' location and motion data with Arity, an Allstate-owned company. Arity used the data to calculate driving scores that could be sold to car insurers to set rates. Users were said not to be clearly informed that their data would be used for insurance pricing. Life360 and Arity stated that users had to opt in and that no personally identifiable driving data was shared without consent.
- Company involved
- Arity
- AI system involved
- Arity IQ network
2 source articles · read the reporting →
CFPB fines General Information Services for inaccurate background checks
The Consumer Financial Protection Bureau took action against General Information Services and its affiliate e-Background-checks.com for failing to ensure the accuracy of employment background screening reports. The companies allegedly provided inaccurate criminal history information to employers, potentially affecting job applicants' eligibility and causing reputational harm. The CFPB ordered the companies to provide $10.5 million in relief to harmed consumers and pay a $2.5 million penalty.
- Company involved
- General Information Services
10 source articles · read the reporting →
FinTech and traditional lenders discriminate against minority borrowers in mortgage pricing
A study of mortgage lending from 2012-2018 found that Latinx and African-American borrowers were charged higher interest rates than white borrowers with similar credit risk. FinTech algorithms reduced the disparity by 40% but did not eliminate it. The discrimination costs minority borrowers an estimated $765 million per year in extra interest.
10 source articles · read the reporting →
Wells Fargo software error caused hundreds of faulty foreclosures
Wells Fargo disclosed that a software error in its mortgage modification underwriting tool caused incorrect denials of loan modifications for approximately 870 borrowers between 2010 and 2015. The error miscalculated attorneys' fees, leading to 545 foreclosures that should not have occurred. Wells Fargo set aside $8 million for remediation and is contacting affected customers to offer compensation and mediation.
- Company involved
- Wells Fargo
3 source articles · read the reporting →
France: CNAF's discriminatory risk-scoring algorithm must be stopped
Amnesty International and coalition partners filed a complaint with the Council of State against CNAF's risk-scoring algorithm used to detect benefit overpayments. The algorithm assigns risk scores based on criteria that discriminate against vulnerable groups, including those with disabilities, single parents, and low-income households. The complaint alleges the system violates human rights to equality and privacy. The EU AI Act's social scoring ban may apply, but its definition remains unclear.
- Company involved
- CNAF
2 source articles · read the reporting →
Deepfake video of Sam Bankman-Fried used in crypto phishing scam
A verified Twitter account posted a deepfake video of FTX founder Sam Bankman-Fried claiming to offer compensation to users of the collapsed exchange. The video directed viewers to a phishing website, ftxcompensation.com, that asked them to connect their crypto wallets and send funds with the promise of doubling them. The site's Ethereum address reportedly received over $1,000 in ETH. The account was later suspended.
10 source articles · read the reporting →
OAIC finds 7-Eleven breached privacy with facial recognition surveys
The Australian Information Commissioner found that 7-Eleven interfered with customers' privacy by collecting facial images and creating faceprints through in-store surveys without adequate notice or consent. The system was used to exclude non-genuine responses and profile demographics. The OAIC ordered 7-Eleven to destroy the collected data and cease the practice.
- Company involved
- 7-Eleven
9 source articles · read the reporting →
Nevada's AI grad score model cuts funding for low-income students
Nevada replaced its income-based school funding formula with a machine learning model developed by Infinite Campus that generates a 'grad score' for each student. The model reduced the number of students eligible for supplemental funding from 288,000 to 63,000, disproportionately affecting low-income students. Critics argue the model lacks transparency and de-emphasizes economic status, potentially leaving many high-poverty schools underfunded.
- Company involved
- Nevada Department of Education
- AI system involved
- Grad score model
7 source articles · read the reporting →
FTC settles with Sitejabber over reviews from customers who had not received goods
The US Federal Trade Commission has charged Sitejabber, an AI-enabled review platform, with deceiving consumers by publishing ratings and reviews submitted at the point of purchase, before buyers had received or experienced the products. The FTC alleges this artificially inflated average ratings and review counts for its clients. Sitejabber has agreed to a proposed consent order prohibiting it from making such misrepresentations in the future.
- Company involved
- Sitejabber
- AI system involved
- Sitejabber
10 source articles · read the reporting →
DeepScore markets facial and voice analysis app for trustworthiness scoring despite experts' doubts
DeepScore, a Tokyo-based company, is marketing an app that uses facial and voice recognition to score people's trustworthiness for lenders and insurers in Japan, Indonesia, Vietnam and the Philippines. The company says the app can detect deception with 70 per cent accuracy, but researchers and privacy advocates say there is no reliable scientific basis for such judgments and warn of discrimination and privacy harms. The chief executive said the system is only one part of lenders' and insurers' decision-making and that people can choose not to use it. Critics respond that an unequal balance of power makes consent difficult.
- Company involved
- DeepScore
- AI system involved
- DeepScore
6 source articles · read the reporting →
Facebook Allowed Age-Targeted Credit Card Ads Violating Its Policy
The Markup found that four companies—Aspiration, Hometap, Chime, and Varo Bank—ran Facebook ads for credit cards and home equity loans that were targeted by age, excluding users under 25 or 35. This practice violates Facebook's own anti-discrimination policy and may violate the Equal Credit Opportunity Act and California's Unruh Civil Rights Act. Facebook did not respond to requests for comment, and some advertisers said they would review their ad targeting.
- Company involved
- Facebook
- AI system involved
- Facebook Ad Platform
9 source articles · read the reporting →
