DOJ fines mortgage lender Fairway for alleged racial discrimination

[BumRushDaShow]

Source: Reuters

October 15, 2024 8:38 PM EDT Updated 11 hours ago


Oct 15 (Reuters) - The U.S. Justice Department and the Consumer Financial Protection Bureau penalized Fairway Independent Mortgage Corporation for alleged redlining in Black neighborhoods in Birmingham, Alabama, the agencies said on Tuesday, which the company denies.

The mortgage lender will pay a $1.9 million penalty and provide $7 million in loan subsidies as a result, the CFPB said in a statement. Fairway determined that a settlement with the bureau would be the most appropriate solution, the company said in a statement.

U.S. Attorney General Merrick Garland said the case was a "reminder that redlining is not a relic of the past and the Justice Department will continue to work urgently to combat lending discrimination wherever it arises." Garland said the enforcement action was part of a Justice Department initiative to combat redlining, the illegal practice of restricting mortgage lending to certain areas based on occupants' race or ethnicity that was banned in 1974.

Officials accuse the company of failing to take action when its own data showed the company was not serving majority Black areas between 2018 and 2022 and of focusing its marketing efforts in majority-white areas between 2015 and 2022.

Read more: https://www.reuters.com/world/us/us-penalizes-mortgage-lender-fairway-alleged-racial-discrimination-alabama-2024-10-15/

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Link to DOJ PRESS RELEASE - Justice Department Secures $8M from Fairway Independent Mortgage Corporation to Address Redlining in Black Communities in Birmingham, Alabama

[ampm]

1. What penalty ?

They will pay for that and still play the game. Until we put real dollars in place this will never stop.

[Martin68]

2. Why is the word "alleged"" used here? If the DOJ fined them then it means they conducted an official investigation

and they were found guilty of an infraction.

[BumRushDaShow]

3. Since it was a "settlement" with a "consent decree"

and not a judgement from a court of law, the weasel words remain.

The Executive Branch cannot find someone "guilty". The Judicial Branch is in charge of that and would do that through some sort of trial (whether "jury" or "bench" where the judge decides). The Judiciary signs-off on those "agreements" but again, this was not a "verdict".