HUD Guidance on AI Use

The Department of Housing and Urban Development (HUD) released two guidance documents on May 2 addressing the application of the Fair Housing Act to two areas in which the use of artificial intelligence (AI) poses particular concerns: the tenant screening process and its application to advertising housing opportunities through online platforms that use targeted ads. The HUD Acting Secretary Adrienne Todman said the new guidance would ensure that private sector partners "who utilize artificial intelligence and algorithms are aware of how the Fair Housing Act applies to these practices."

The new tenant screening guidance describes fair housing issues created by tenant screening practices, including the increasing use of third-party screening companies to aid with tenant screening decisions and the emerging use of machine learning and artificial intelligence. The guidance also suggests best practices for fair, transparent, and non-discriminatory tenant screening policies, for both housing providers and companies that offer tenant screening services.

The new guidance for use of online advertising platforms cautions that violations of the Fair Housing Act may occur under various scenarios, including: when ad targeting and delivery functions are used-on the basis of protected characteristics-to target vulnerable consumers for predatory products or services, display content that could discourage or deter potential consumers, or charge different amounts for delivered advertisements.