Profs: considering credit history could violate rights of mentally ill

Various federal laws, including the Americans with Disabilities Act and Fair Housing Act, prohibit discrimination against disabled persons, and mental illness is a disability. And so — say three professors — businesses may be violating these laws by dinging credit applicants for poor credit history unless they make allowance for persons whose poor financial choices were the result of mental illness. Bonus: citation to authority of “United Nations Convention on the Rights of Persons with Disabilities (which the United States has signed)” [Christopher Guzelian, Michael Ashley Stein, and H. S. Akiskal, SSRN via @tedfrank]


  • Disparate impact theory is just the gift that keeps on giving. To explain, it’s normally not necessary for anyone to accommodate anybody without a request for accommodation. In other words, if you know you’re being rated by some credit company, you would have to announce your mental illness to them, supply them with a diagnosis, and ask that it be taken into account. Nobody does this, for obvious reasons.

    It also appears from the executive summary, that Elizabeth Warren has emerged from her teepee to lend her insight to the situation. Feh.

  • My firm did a pro bono case for a person with Tourette’s Syndrome who lived in a community of attached townhomes. Through no fault of his own, his outbursts disturbed a neighbor, and the neighbor got the assistance of the HOA, which ultimately threatened to force the person with Tourette’s Syndrome to sell. I, of course, sympathized with the person with the condition, but my sympathies lay more with the neighbor forced to endure loud cursing outbursts. Seems to me that her right of quiet enjoyment should trump the right of a person to inflict his symptoms on others in a pervasive manner.

    The Tourette’s patient won, but, in my view, shouldn’t have.

  • Sure, as long as the person can prove that their mental illness is a thing of the past. Perhaps the American Psychological Association would underwrite its members’ written affirmations of such cures, in case of the incredibly rare event that an illness resurfaces and someone has to sue for damages.

    /Yes I do live under a rock. But if you treat me as crazy you’ll violate the law!

  • And how are creditors going to be able to make allowances for financial choices made as of results of metal illness without violating a medical privacy “right”?

  • It’s not their fault they have a bad payment history, they’re too mentally ill to handle finances in a responsible manner.

    Yeah, this will really help them out when all credit goes away.

    • You’ve just described most of our elected officials. “It’s not their fault they have a bad payment history, they’re too mentally ill to handle finances in a responsible manner.” and most of the voters who keep re-electing them.

  • What a great opportunity for identity theft and fraud. Comb the court records to identify persons subject to guardianships because they cannot manage their affairs, and then use their identities to fraudulently obtain goods, services, credit and loans. Then skip and leave it for the guardian to deal with the mess, someone who likely are next of kin serving because they care about their wards, and not because of financial sophistication. Thank you Professors. You’ll be protecting the rights of disabled persons and their care givers right into bankruptcy.

  • Anyone who gets into such a fix that they can’t pay their credit card bills is insane. Next!


  • All this liberal gibberish is driving me crazy.

    Hmmmm, where do I sign for the loan and can I get a VISA card with that?

  • One of many catch-22 clauses. Can’t consider credit history for giving a loan, but get in trouble with regulators if too many risky loans. Can’t consider criminal history (ban the box) but get in trouble if an employee assaults a customer or steals from you. argh

  • Who’s crazier, the mentally ill guy, or the guy who loans him money?