A new FTC decision could potentially bring DEI into business practices across the country, according to a GOP commissioner.

One Republican commissioner has warned that the Federal Trade Commission's (FTC) new decision could encourage diversity, equity and inclusion (DEI) practices in companies that offer price-varied goods and services nationwide.

On Thursday, the FTC settled a case against an Arizona car dealership that was accused of advertising misleading prices for vehicles. The actual prices were thousands of dollars higher than what was advertised.

The dealership was accused of discriminatory financing practices, including arranging financing with higher prices for Latino consumers than for non-Latino, White customers.

While Republican FTC Commissioner Melissa Holyoak concurred with the majority in determining violations of the Equal Credit Opportunity Act (ECOA) in this case, she expressed concern that the majority also added an unnecessary violation of Section 5 of the FTC Act, which she believed could have a detrimental impact on businesses in the future.

Holyoak stated that even if well-intentioned, broad liability standards under disparate impact theories can have unintended consequences, particularly when applied to the entire American economy, increasing the risk of unlawful race-based practices.

The resolution to our country's racial issues cannot be achieved through policies based on affirmative action or any other notion of fairness. Racialism cannot be resolved through more racialism, as stated by her, referring to the recent Supreme Court decision in Students for Fair Admissions v. Harvard, which prohibited race-based factors in higher education admission policies.

Holyoak stated that without Congressional approval, the Commission should not expand the FTC's unfairness consumer protection mandate into a comprehensive civil rights authority, which could result in unforeseen and detrimental consequences.

The consequences of individual liability being assigned by the Commission due to statistical disparities may be particularly harmful. People may feel compelled to protect themselves from liability by incorporating racial considerations, practices, or audits into their daily business operations to avoid future discrimination claims.

The FTC's decision could force businesses to make business decisions based on race or DEI-related factors to avoid enforcement.

The FTC is a federal agency responsible for enforcing consumer protection and competition laws across various economic sectors. Its mission is to safeguard the public from unethical business practices and competition through law enforcement, research, education, and advocacy.

The commission has five members, including two Republicans and three Democrats. President Biden has nominated Lina Khan to be the chair.

Planet Chronicle Digital reached out to Khan for comment on Holyoak's remarks.

Holyoak wrote that bringing an "unfair discrimination" claim based on statistical analysis and disparate impact is in line with a broader vision to establish economy-wide, equity-oriented regulation of conduct that has never been prescribed by Section 5 of the FTC Act.

The FTC Act's Section 5 prohibits any individual or business from engaging in deceptive or unfair practices that impact commerce.

The Commission has asserted its authority for "unfair discrimination" only outside court scrutiny and in the context of consent orders, as Holyoak notes in a footnote.

Holyoak explained that disparate impact theory has been used in civil rights laws to examine whether a neutral policy has disproportionately affected members of a protected class.

In 2020, former Commissioner Chopra recommended using disparate impact analysis and the FTC's unfairness authority as a way to combat discrimination across the economy, according to Holyoak.

Holyoak stated that the broader motivation behind the approach in this case, which is to combat discrimination across the economy, makes it clear that the Majority's purpose for including the otherwise superfluous unfair discrimination count is to expand unfairness beyond its traditional boundaries.