NEW YORK (Legal Newsline) - Those who received higher interest rates from a lender because of their race are receiving more than $900,000 in restitution thanks to New York Attorney General Andrew Cuomo.
Approximately 270 African-American and Latino borrowers will soon receive the checks after Cuomo alleged GreenPoint brokers were manipulating interest rates. GreenPoint is a subsidiary of Capital One Financial Corp.
"No business should even think about basing prices on a customer's skin color, ethnicity or national origin," Cuomo said. "In this case, we identified discriminatory practices and obtained restitution for hundreds of minority New Yorkers.
Cuomo said Home Mortgage Disclosure Act data prompted his investigation. It showed that minority customers were more likely than white customers to receive high-priced loans in New York.
GreenPoint and Cuomo reached a fair lending agreement for more than $1 million. The company has stopped making residential mortgage loans.
The first-term Democrat added that he is still investigating discriminatory pricing by other mortgage brokers that did business with GreenPoint.
GreenPoint must also take actions against brokers whose pricing practices contributed to the discrimination and enhance monitoring of broker conduct.
"We believe there is an industry-wide problem in which African-American and Latino borrowers are being charged higher prices," Cuomo said. "Following GreenPoint's lead, responsible lenders should increase monitoring of their employees' and brokers' conduct and take necessary steps to ensure fair lending practices."
From Legal Newsline: Reach John O'Brien by e-mail at firstname.lastname@example.org.