On June 29th, the Consumer Financial Protection Bureau (CFPB) and the Department of Justice (DOJ) announced a joint action against BancorpSouth Bank for discriminatory mortgage lending practices that harmed African Americans and other minorities. The complaint filed by the CFPB and DOJ alleges that BancorpSouth engaged in numerous discriminatory practices, including: Illegally redlining in Memphis; Denying certain African Americans mortgage loans more often than similarly situated non-Hispanic white applicants; Charging African-American customers for certain mortgage […]
Tag: DOJ
TURNING A BLIND EYE WON’T FLY
On April 25, the U.S. District Court for the Eastern District of North Carolina entered a consent order and approved a settlement resolving the DOJ’s complaint charging Four Oaks Bank with unlawfully allowing third party merchants to work through the bank to defraud consumers. Four Oaks’ clients included a Texas-based third-party payment processor that provided access to the national payment system to a wide variety of merchants. Four Oaks was specifically informed that many of […]
ANOTHER DOJ DISCRIMINATION SETTLEMENT
On July 12, 2012, Wells Fargo, the nation’s largest mortgage lender, agreed to settle with the Justice Department to resolve allegations that it steered black and Hispanic borrowers into subprime loans when similarly qualified white borrowers received mortgages with lower rates. The settlement requires Wells Fargo to provide $125 million to borrowers, $50 million in down-payment assistance in hard-hit regions where Justice found evidence of discrimination, and additional compensation to blacks and Hispanics who were […]
ANOTHER DOJ FAIR LENDING CASE
On May 31st the Department of Justice settled a fair lending case with Sun Trust Mortgage. The case was completely typical. The case: > Began with a referral from the bank’s regulator – the Federal Reserve Board. > Involved discrimination against black and Hispanic borrowers. > Involved pricing discrimination resulting from unguided lender discretion. DOJ continues to very active in this area. During the past few years DOJ has averaged about seven cases per year. […]