The United States Justice Department announced an agreement on Jan. 12 with City National Bank to resolve allegations that that bank engaged in a pattern and practice of lending discrimination in Los Angeles County. The resolution includes more than $31 million in relief to impacted individuals and communities.
The agreement is part of the department’s Combating Redlining Initiative launched by Attorney General Merrick B. Garland in October 2021. It represents the largest redlining settlement in its history. City National is the largest bank headquartered in Los Angeles and among the 50 largest banks in the United States.
Redlining is an illegal practice in which lenders avoid providing credit services to individuals living in communities of color because of the race, color, or national origin of the residents in those communities. A complaint filed in federal court alleges that from 2017 through at least 2020, City National avoided providing mortgage lending services in majority-Black and Hispanic neighborhoods in Los Angeles County and discouraged residents in those neighborhoods from obtaining mortgage loans.
The complaint also alleges that during that time period, other banks received more than six-times as many applications in majority-Black and Hispanic neighborhoods in Los Angeles County than City National each year. City National only opened one branch in a majority-Black or majority-Hispanic neighborhood in the past 20 years, authorities said, despite having opened or acquired 11 branches during that time period. And unlike at its branches in majority-white areas, City National did not assign any employees to generate mortgage loan applications at that branch.
City National worked with the department to remedy the allegations. In conjunction with this settlement, City National has announced that it is proactively taking steps to expand its lending services to provide greater access to credit in communities of color. Housing discrimination can be reported by calling (213)894-2879, and emailing firstname.lastname@example.org.
This site uses Akismet to reduce spam. Learn how your comment data is processed.