The Federal Trade Commission has struck deals with auto dealers, effectively ignoring court-ordered obligations to prevent unlawful credit discrimination. This move is seen as a step back by some legal experts and state attorneys.

Defendants in the cases, including former managers at Coulter Motor Company, agreed not to enforce fair lending programs or engage in discriminatory practices. However, critics say this undermines previous efforts aimed at ensuring equal treatment for minority borrowers.

The FTC’s decision focuses on statistical analyses of disparate impact, a theory that has faced scrutiny during the Trump administration. Critics argue that this approach is crucial as AI systems increasingly make important decisions like loan eligibility.

With these agreements, the FTC risks weakening future enforcement efforts and allowing discriminatory practices to persist. The unusual nature of these deals raises questions about transparency and cooperation between federal and state authorities.