COLUMBUS, Ohio (Legal
Newsline) — The U.S. Department of Justice announced Dec. 28 that Union Savings
Bank and Guardian Savings Bank had settled allegations of engaging in “redlining,” a practice of
discriminating against predominantly African-American neighborhoods in and
Through the alleged strategy,
the companies denied or avoided credit services to consumers of these
neighborhoods due to the neighborhoods’ racial demographics. According to the department, the
companies violated the Fair Housing Act and Equal Credit Opportunity Act.
“Lenders must treat all
potential borrowers equally and fairly,” said principal deputy assistant attorney general Vanita Gupta, head of the Justice Department’s Civil Rights
Division. “This settlement embodies a win-win solution for all parties by
increasing the volume of mortgage loans, driving economic activity and creating
a level playing field for qualified borrowers.”
United Savings and Guardian Savings agreed to
commit $9 million in investments for majority African-American neighborhoods
throughout the Cincinnati, Columbus, Dayton and Indianapolis metropolitan areas.
They will also commit $2 million to advertising, outreach and financial
education in those neighborhoods.
“Redlining has no place in
the Southern District of Ohio,” said U.S. attorney Benjamin C. Glassman of the district. “This office is committed to vigorously
enforcing the guarantees of the Fair Housing Act and the Equal Credit
Opportunity Act so that the people in our district can borrow without prejudice
based on race and color.”