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53 B.C. L. Rev. 1695 (2012)
Toward a Stronger Financial History Antidiscrimination Norm

handle is hein.journals/bclr53 and id is 1711 raw text is: 


                              LEA  SHEPARD*

   Abstract: This Article examines a topic at the intersection of consumer
   protection and antidiscrimination law: the use by employers and licensing
   organizations of applicants' credit reports and financial histories in the
   hiring and licensing processes. The Article begins with a broad normative
   assessment of the merits of the practice by examining applicable logics of
   personhood,  categories of a framework  of antidiscrimination analysis
   that assesses whether traditionally unprotected groups are entitled to
   formal antidiscrimination safeguards. Thus, the Article considers whether
   financial histories validly and reliably reflect personality traits relevant to
   job performance. It then examines to what extent the use of financial his-
   tory in the employment and  licensing settings is a necessary and helpful
   deterrent to debt default-long regarded  as a socially undesirable prac-
   tice. Next, the Article evaluates the practice's impact on traditionally dis-
   advantaged groups  by assessing its relationship to racial equality and so-
   cial mobility. Finally, in a novel application of behavioral economics to the
   area of credit reports and financial history, this Article suggests that, in
   spite of the difficult conceptual distinctions between consumer debtors
   and traditional Title VII categories like race, sex, and national origin, the
   findings of behavioral economists suggest that an adverse financial status
   is more immutable   than neoclassical economists have been  willing to
   concede. These observations lend critical normative support to legislative
   efforts to establish a stronger financial history antidiscrimination norm.

   * © 2012, Lea Shepard, Assistant Professor, Loyola University Chicago School of Law;
J.D., Harvard Law School; A.B., Duke University. I thank Elizabeth Glazer, Cynthia Ho,
Dan  Krivinskas, Donna Krivinskas, Nancy Ota, Geoffrey Rapp, Alan White, and all atten-
dees of the 2011 Central States Law Schools Association Conference, the LatCrit XVI Con-
ference, and the Symposium on Credit Scoring and Credit Reporting for their very helpful
comments  and suggestions. My library liaison, Patricia Scott, and my research assistants,
Patrick Gleeson, Leigh Kelly, and Ashley Koenen, provided excellent research support. I
thank my family for their kindness and guidance. As always, I owe Spencer Shepard IV, my
wonderful husband, my deepest gratitude for his patience, helpful feedback, and encour-


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