The new initiative represents the department’s most aggressive and coordinated enforcement effort yet to address redlining, which is prohibited by the Fair Housing Act and the Equal Credit Opportunity Act.
“Lending discrimination runs counter to fundamental promises of our economic system,” Attorney General Merrick Garland said in a release. “When people are denied credit simply because of their race or national origin, their ability to share in our nation’s prosperity is all but eliminated. Today, we are committing ourselves to addressing modern-day redlining by making far more robust use of our fair lending authorities. We will spare no resource to ensure that federal fair lending laws are vigorously enforced and that financial institutions provide equal opportunity for every American to obtain credit.”
The DOJ noted that redlining, a practice institutionalized by the federal government during the New Deal era and implemented then and now by lenders, has had a lasting negative impact.
“For American families, homeownership remains the principal means of building wealth, and the deprivation of investment in and access to mortgage lending services for communities of color have contributed to families of color persistently lagging behind in homeownership rates and net worth compared to white families,” the DOJ stated. “The gap in homeownership rates between white and Black families is larger today than it was in 1960, before the passage of the Fair Housing Act of 1968.”
The initiative, which will be led by the Civil Rights Division’s Housing and Civil Enforcement Section in partnership with U.S. Attorney’s offices, will:
The initiative was kicked off by a joint agreement with the DOJ, Consumer Financial Protection Bureau, the Office of the Comptroller of the Currency and the U.S. Attorney’s Office for the Western District of Tennessee to resolve allegations that Trustmark National Bank engaged in lending discrimination by redlining predominantly Black and Hispanic neighborhoods in Memphis, Tenn.
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