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Bank of America has agreed to fork over a record $335 million to settle claims that its mortgage division, Countrywide Financial, discriminated against minority homebuyers.
Countrywide charged higher fees and interest rates to more than 200,000 black and Hispanic borrowers and steered minority home purchasers into subprime mortgages, the U.S. Department of Justice said.
“The department’s action against Countrywide makes clear that we will not hesitate to hold financial institutions accountable, including one of the nation’s largest, for lending discrimination,” Attorney General Eric Holder said.
Bank of America bought Countrywide in 2008 and has spent billions to clean up the mess left behind by the mortgage lender.
“We reached this settlement to resolve issues about Countrywide’s alleged historic practices that occurred before Bank of America acquired the company,” said Bank of American spokesman Dan Frahm.
“We are committed to fair and equal treatment of all our customers, and will continue to focus on doing what’s right for our customers, clients and communities.”
The National Council of La Raza, a Hispanic civil rights and advocacy organization, applauded the Department of Justice for holding Countrywide accountable.
“This historic settlement sends a powerful message that financial institutions will be held accountable for targeting communities of color with unfair practices that have led to needless foreclosures,” said Janis Bowdler, Director of the Wealth-Building Policy Project at NCLR.
With News Wire Services