Weaponized Data

Weaponized Data: How Information & Technology Restrict Access and Harm Communities

Š 2019 National Fair Housing Alliance Please do not distribute.

www.nationalfairhousing.org

@natfairhouse @ItsLisaRice 1

Data and Technology are the New Civil Rights Frontier • Industries more and more onRestrict data Access to deliver products and services Weaponized Data: relying How Information & Technology and Harm Communities

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Housing Credit/Financial Services Insurance Employment Criminal Justice Food Access Transportation

© 2019 National Fair Housing Alliance Please do not distribute.

www.nationalfairhousing.org

@natfairhouse @ItsLisaRice 2

Technologies in Housing and Financial Services • Credit Scoring Weaponized Data: How Information & Technology • Automated Underwriting Systems Restrict Access and Harm Communities •

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Automized Verifications Processing

Risk-based Pricing Advertising Systems/Platforms Revenue Management Software Eloans Video-Conferencing Digital Fingerprinting Facial Recognition Systems

© 2019 National Fair Housing Alliance Please do not distribute.

www.nationalfairhousing.org

@natfairhouse @ItsLisaRice 3

Data and Technology are not Innocuous Weaponized Data: How Information & Technology Restrict Access and Harm Communities • Data is tainted

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Computers are not blind Technology can make it easier to manifest/replicate discrimination Technology can amplify discrimination Technology can systemize discrimination

© 2019 National Fair Housing Alliance Please do not distribute.

www.nationalfairhousing.org

@natfairhouse @ItsLisaRice 4

Federal Policies • • • • • • • • • • • •

Land Grant Act Homestead Act Indian Removal Act Jim Crow Laws Home Owners’ Loan Corporation Act National Housing Act Chinese Exclusion Act Social Security Act Japanese Internment Urban Renewal Model Cities National Highway Act

Dual Credit Market Disproportionately Impacts Under-Served Groups

@NatFairHouse Š 2018 National Fair Housing Alliance Please do not distribute.

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Weaponized Data: How Information & Technology Restrict Access and Harm Communities

Š 2019 National Fair Housing Alliance Please do not distribute.

www.nationalfairhousing.org

@natfairhouse @ItsLisaRice 7

Consumers of Color Disproportionately Use AFS

@NatFairHouse Š 2018 National Fair Housing Alliance Please do not distribute.

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Credit Scoring Weaponized Data: How Information & Technology Restrict Access and Harm Communities

Š 2019 National Fair Housing Alliance Please do not distribute.

www.nationalfairhousing.org

@natfairhouse @ItsLisaRice 9

AFS Usage Negatively Impacts Credit Scores •

Subprime loans and non-traditional credit information are not reported to repositories when the payments are timely made.

Weaponized• Data: How Information & Technology Restrict and Harm Communities Negative collections/default data is reported to Access credit repositories.

• People of color have higher uninsured rates and therefore may be more likely to have medical debt collections which can unfairly cause lower credit scores – especially in older scoring models.

• Scoring mechanisms do not control for predatory loan terms, distribution channels or abusive debt collection procedures, which can negatively impact borrowers of color.

• Borrowers may unduly have a lower credit score not because they themselves were risky but rather because the product they obtained, the distribution channel they used, their loan servicer or debt collection agency caused the risk.

• Scoring models cannot pick up the fact that a consumer has credit available to use when the source of the credit is from a fringe lender.

• Borrowers who face discrimination and therefore must pursue multiple lenders to seek credit will have a negative impact on their scores. © 2019 National Fair Housing Alliance Please do not distribute.

www.nationalfairhousing.org

@natfairhouse @ItsLisaRice 10

Risk-based Pricing Systems Weaponized Data: How Information & Technology Restrict Access and Harm Communities

Š 2019 National Fair Housing Alliance Please do not distribute.

www.nationalfairhousing.org

@natfairhouse @ItsLisaRice 11

Risk-based Pricing Systems Perpetuate Discriminatory Outcomes Weaponized Data: How Information & Technology Restrict Access and Harm Communities

• Berkeley Analysis • • • • • • • •

Both face-to-face and online lenders overprice African American and LatinX borrowers Surcharge ranges from 5.6 to 8.6 basis points higher interest rate 11 to 17 higher profits Up to $500 billion each year in additional, unfair costs Systems may use what Professor Adair Morse calls “algorithmic strategic pricing” May be tethered to geography, ie. borrowers living in credit deserts May reflect fewer shopping options due to dual credit market May Be incorrectly “reading” bias in the market

© 2019 National Fair Housing Alliance Please do not distribute.

www.nationalfairhousing.org

@natfairhouse @ItsLisaRice 12

Š 2019 National Fair Housing Alliance Please do not distribute.

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Š 2019 National Fair Housing Alliance Please do not distribute.

www.nationalfairhousing.org

@natfairhouse @ItsLisaRice 14

AI-based Advertising Systems Weaponized Data: How Information & Technology Restrict Access and Harm Communities

Š 2019 National Fair Housing Alliance Please do not distribute.

www.nationalfairhousing.org

@natfairhouse @ItsLisaRice 15

Weaponized Data: How Information & Technology Restrict Access and Harm Communities

Š 2019 National Fair Housing Alliance Please do not distribute.

Š 2017 National Fair Housing Alliance distribute.

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Please do not

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Facial Recognition Technology Weaponized Data: How Information & Technology Restrict Access and Harm Communities

Š 2019 National Fair Housing Alliance Please do not distribute.

www.nationalfairhousing.org

@natfairhouse @ItsLisaRice 17

Weaponized Data: How Information & Technology Restrict Access and Harm Communities

Š 2019 National Fair Housing Alliance Please do not distribute.

www.nationalfairhousing.org

@natfairhouse @ItsLisaRice 18

Weaponized Data: How Information & Technology Restrict Access and Harm Communities

Š 2019 National Fair Housing Alliance Please do not distribute.

www.nationalfairhousing.org

@natfairhouse @ItsLisaRice 19

Solutions •

Dramatically increase diversity in Tech, Financial Services and Housing Weaponized Data: How Information & Technology Restrict Access and Harm Communities industries • Training for engineers, developers, coders, etc.

• Increased networking between advocates and data analysts/tech professionals • Increase fair housing/fair Lending Enforcement • Improve platforms/systems to remove bias • Remove racial disparities – individual- and community-based • Close racial wealth gap © 2019 National Fair Housing Alliance Please do not distribute.

www.nationalfairhousing.org

@natfairhouse @ItsLisaRice 20

Weaponized Data: How Information & Technology Restrict Access and Harm Communities

Š 2019 National Fair Housing Alliance Please do not distribute.

www.nationalfairhousing.org

@natfairhouse @ItsLisaRice 21