AI Governance Engineer
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Adverse action notice

By Updated

The notice a US creditor must give when it denies or worsens credit, stating the specific principal reasons 1. The reasons must be accurate even when the decision comes from a complex model, so reason codes need a fidelity test.

Developed in
ch. 20, Credit and lending
Chapters
ch. 16, Fairness & XAI · ch. 20, Existing Law
Contrast with
Decision notice
Source
1 numbered reference, listed below

Where it is used

The term is not used under this name in running prose; the sections listed under "Developed in" treat it.

  • Reason code

    A stable, human-readable statement of a principal factor behind an adverse decision, mapped from the factors the model actually scored and versioned with the…

Sources

  1. [1] 12 CFR 1002.9 (Regulation B, notifications) (1002.9(b)(2) statement of specific principal reasons for adverse action; Supplement I commentary; text as of 2026-09-01). eCFR. 2026-09-01. https://www.ecfr.gov/current/title-12/chapter-X/part-1002/section-1002.9 (verified: primary)

Definitions of legal terms paraphrase the cited text, which governs. Dated statements are as of .

Cite this term

García Aibar, J. (2026). Adverse action notice. In AI Governance Engineering: The Thesis & Body of Knowledge (v0.5.0), Glossary. https://doi.org/10.5281/zenodo.22956197. https://aigovernanceengineer.com/glossary/adverse-action-notice. CC BY 4.0

BibTeX

@misc{aige2026adverseactionnotice,
  author  = {Jorge García Aibar},
  title   = {{Adverse action notice}},
  note    = {Glossary, AI Governance Engineering: The Thesis \& Body of Knowledge, version 0.5.0},
  year    = {2026},
  doi     = {10.5281/zenodo.22956197},
  url     = {https://aigovernanceengineer.com/glossary/adverse-action-notice}
}