KleinBank allegedly engaged in 'redlining' in Twin Cities

By Mark Iandolo | May 14, 2018

WASHINGTON (Legal Newsline) — The U.S. Department of Justice announced May 8 that KleinBank will settle allegations of “redlining,” a practice of discrimination in which lenders intentionally avoid providing services to members of certain communities because of the race or national origin of those residents.

KleinBank purportedly committed discrimination in predominantly minority neighborhoods in and around the Twin Cities of Minneapolis-St. Paul between 2010 and at least 2015. Alleged conduct of this nature violates the the Fair Housing Act and the Equal Credit Opportunity Act. 

To resolve the allegations, KleinBank will expand its banking services in predominantly minority neighborhoods. The company will also spend $300,000 for a loan subsidy fund for those neighborhoods and another $300,000 for advertising, outreach and financial education in those areas.

“Federal law prohibits lenders from discriminating against mortgage applicants and other potential customers based on race or national origin,” said acting assistant attorney general John Gore of the Civil Rights Division. “The Justice Department will continue to use its enforcement authority to combat this illegal discrimination.”

Handling the case for the Justice Department was the  Civil Rights Division’s Housing and Civil Enforcement Section.

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