Bank of America to pay $300K over federal discrimination probe

by Ryan Smith28 Jul 2020

Bank of America will pay $300,000 to settle federal allegations that it denied mortgages and home equity loans to people with disabilities.

Between 2010 and 2016, the bank allegedly denied mortgages to adults with disabilities who were under legal guardianship, in violation of the Fair Housing Act, according the Department of Justice. The bank allegedly denied disabled adults home equity loans until 2017.

“No one in this free country should be denied access to the American dream merely because of a disability,” said Assistant Attorney General Eric Dreiband of the DOJ’s Civil Rights Division. “The unalienable right to pursue happiness extends to all people, including those with disabilities, and purchasing a home is one way many people exercise this right. The Fair Housing Act prohibits banks from denying mortgage loans and other housing-related credit to people because of their disabilities, and this department will hold accountable those lenders who engage in such illegal conduct. Today’s settlement provides compensation to victims of unlawful discrimination and requires Bank of America to apply non-discriminatory policies in deciding which applicants will receive loans.”

“This settlement ensures that Bank of America will no longer discriminate against people with disabilities when issuing mortgage and home equity loans, and compensates the victims for their losses,” said Seth D. DuCharme, acting US attorney for the Eastern District of New York. “Our office is committed to standing up for the rights of individuals with disabilities and taking action when necessary to vindicate those rights.”

Under the terms of the settlement, BoA will pay $4,000 per loan to eligible applicants who were affected by the policy. The DOJ said it expects the payments to total around $300,000. The settlement also requires the bank to maintain non-discriminatory underwriting policies and monitor loan-processing and underwriting activities to ensure compliance with the Fair Housing Act.