FTC mails $1.5 million in mortgage refund checks to Hispanics
The Federal Trade Commission mailed $1.5 million in refund checks to Hispanic borrowers who were allegedly charged more on their mortgage than whites.
The refund stems from a lawsuit the FTC filed against California-based Golden Empire Mortgage and its CEO Howard Kootstra. The suit alleged the company charged Hispanic consumers higher prices for mortgages. The pricing disparity could not be explained in the borrowers' credit or underwriting risk.
In September, a settlement was struck. A $5.5 million judgment was suspended when the defendants paid the $1.5 million for the refunds. The settlement bars the defendants from discriminating on the basis of national origin in future loans and requires Golden Empire to establish a policy restricting the discretion of a loan originator's pricing.
Golden Empire is also required to establish a fair-lending monitoring program, another program to ensure the accuracy and completeness of its data and training programs for employees.
The FTC sent more than 3,100 checks, urging borrowers who receive the checks to cash them before June 21.
Write to Jon Prior.
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