Business
(Reuters) – The end U.S. consumer financial watchdog agency on Friday acknowledged it had reached a settlement in a prolonged-running lawsuit with a Chicago mortgage lender over alleged racial discrimination.
Beneath the terms of the proposed settlement, Townstone Financial would pay a $105,000 ravishing into the U.S. Client Financial Protection Bureau’s victims relief fund.
In a assertion on its web space, the Pacific Apt Foundation, which represented Townstone, acknowledged the corporate neither admitted nor denied the allegations and settled due to the government’s superior correct resources. “This case should never have been brought,” attorney Steve Simpson acknowledged.
WHY IT MATTERS
The CFPB says the enforcement lunge follows the agency’s July correct victory sooner than the U.S. Seventh Circuit Court docket of Appeals, which gave it novel freedom to fight racial discrimination no longer ideal in lending but additionally in marketing of loans. It’s miles the agency’s second lunge on racial bias in the mortgage change in less than three weeks.
KEY QUOTE
“The CFPB’s lawsuit against Townstone Financial included a major appellate court victory that makes clear that people are protected from illegal redlining even before they submit their application,” CFPB Director Rohit Chopra acknowledged in a assertion.
CONTEXT
In 2020, the CFPB accused Townstone Financial of discouraging Shadowy folk from applying for mortgages and warding off the credit needs of African American neighborhoods in the Chicago space. In weekly marketing radio exhibits and podcasts, the corporate allegedly disparaged predominantly Shadowy neighborhoods as crime ridden and the “jungle.”
