Huh? I'm all for calling this what it is: discrimination. But many these are private institutions. They can discriminate however they want. Also as people have been saying for a long time: standardized tests don't necessarily measure what certain educational institutions deem important.
Also for what it's worth, I encountered more cheating Chinese students in my time in college than any other race by far. They even had email lists where they'd circulate around all the test prompts and homework answers. So let's not pretend like grades and test scores are some end-all be-all of academic achievement.