On July 31, the Illinois governor signed the Civil Rights Safeguard Act, Public Act 104-0744, into law. The law codifies disparate impact liability under the Illinois Human Rights Act for employment, financial credit, and public accommodations. The law, which takes effect January 1, 2027, makes it a civil rights violation for financial institutions to use criteria or methods that have the effect of subjecting individuals to unlawful discrimination in connection with loans or credit cards. Such criteria or methods are unlawful if they are not necessary to achieve a substantial, legitimate and nondiscriminatory interest, or if that interest could be served by another practice with a less discriminatory effect. The law also permits the Illinois Department of Human Rights (IDHR) to consult with the Secretary of Financial and Professional Regulation or a financial institution’s primary prudential regulator when investigating a charge involving a financial institution, while preserving IDHR’s investigative authority and specified financial regulators’ examination authority.

According to the governor’s office, the legislation responds to federal policy changes that have raised questions about civil rights protections, and is intended to ensure that disparate impact standards remain enforceable in Illinois regardless of changes in federal enforcement priorities.