Bank of America will contribute more than $400,000 towards fair housing efforts in South Carolina and nationwide as the result of a settlement between the bank and the National Fair Housing Alliance over charges of lending discrimination, the fair housing group announced Friday.
The settlement covers charges levied against Bank of America by the NFHA in 2014. That original complaint led to the Department of Housing and Urban Development filing charges against Bank of America earlier this year for lending discrimination.
The original complaint from the NFHA complaint alleged that Bank of America and two of its employees in South Carolina discriminated against Hispanic mortgage borrowers.
When HUD filed charges against Bank of America back in January, the NFHA said that it conducted a series of “secret shopper” tests where Hispanic and non-Hispanic individuals, posing as prospective mortgage borrowers, attempted to get a mortgage from a Bank of America branch in Charleston, South Carolina.
Those tests revealed that Hispanic prospective mortgage borrowers received inferior loan options compared to non-Hispanic prospective borrowers, the NFHA said.
In January, HUD accused Bank of America of discrimination based on national origin by treating the Hispanic testers less favorably than the non-Hispanic testers, which would qualify as a violation of the Fair Housing Act.
As a result of those charges, Bank of America and the NFHA reached a settlement.
Under the terms of the agreement, Bank of America will invest in efforts designed to increase Hispanic homeownership in Charleston, including $50,000 donations to Metanoia and Origin S.C., two Charleston-area organizations.
According to the NFHA, that $100,000 will be used for down payment and closing cost assistance for Hispanic homebuyers in the Charleston area.
Under the terms of the settlement, Bank of America will also give $336,380 to the NFHA to be used to support of NFHA’s mission of ensuring equal housing opportunity.
Additionally, the NFHA said that Bank of America is committed to “continuing its community partnerships with organizations focused on promoting homebuyer education and counseling and financial literacy to all prospective homebuyers in the Charleston area.”
When contacted by HousingWire, a spokesperson for Bank of America said that the bank denies all of the allegations made by HUD and the NFHA, but chose to settle nonetheless.
“Bank of America rejects all of the allegations in the complaint and voluntarily entered into an agreement with NFHA to resolve the matter,” a Bank of America spokesperson said in a statement.