Agency Lobs More Discrimination Claims Against U.S. Bank

Agency Lobs More Discrimination Claims Against U.S. Bank

10/15/2013 BY: ASHLEY R. HARRIS

The National Fair Housing Alliance (NFHA) and six of its member organizations announced that they have amended their federal housing discrimination complaint against U.S. Bank.

The civil rights groups allege U.S. Bank continues to maintain and market foreclosed homes in white neighborhoods in a much better manner than in African-American and Latino neighborhoods. Failing to maintain and market homes because of the racial or ethnic composition of the neighborhood violates the federal Fair Housing Act.

New metropolitan areas were added to the complaint, including: Baton Rouge, Louisiana; Indianapolis, Indiana; Memphis, Tennessee; and Milwaukee, Wisconsin. Evidence already in the complaint from the Chicago metropolitan area is being supplemented with additional properties near Chicago. NFHA also made claims to HUD that U.S. Bank is involved in those same practices in Baltimore.

The six member organizations that filed the complaint with NFHA are the Fair Housing Center of Central Indiana, HOPE Fair Housing Center located in Illinois, South Suburban Housing Center based in Illinois, Open Communities located in Illinois, Metropolitan Milwaukee Fair Housing Council, and the Greater New Orleans Fair Housing Action Center.

The complaint now brings the total to 24 cities in 11 metropolitan areas where U.S. Bank is alleged to have discriminated in the maintenance and marketing of its bank-owned homes and homes for which it is the owner of record as the trustee. The number of new properties added to the complaint is 96, bringing the total number of properties to 273.

The original complaint was filed with HUD on April 17, 2012, and included Atlanta, Georgia; Dayton, Ohio; Miami-Fort Lauderdale, Florida; Oakland-Richmond-Concord, California; and Washington, D.C.

“U.S. Bank has failed to take care of homes that it owns and for which it is the owner of record in the communities of color we have investigated,” said Shanna L. Smith, president and CEO of NFHA. “U.S. Bank’s actions have significant financial and health impacts on local governments, schools, neighborhoods, and homeowners who live near these neglected properties. Homes with broken and boarded windows and overgrown lawns become targets for vandalism, dumping, and criminal activity. “

U.S. Bank, however, maintains that it has done nothing wrong.

“Unfortunately, NFHA’s claims against U.S. Bank have been inaccurate. U.S. Bank is one of the nation’s leading corporate trustees, which is important in this matter because it means we have no legal right to service or maintain properties that are held in an investment pool for which we are trustee,” said Thomas Joyce, SVP and director of corporate public relations for U.S. Bancorp.

“The vast majority of the properties originally identified by NFHA are properties where we are trustee. We have no legal ability to service or maintain these properties,” Joyce stressed.

Joyce says the bank has been fully cooperative with NFHAand will continue to investigate the claims made against it.

“When we do own a property, we have a strong and comprehensive process in place to regularly inspect and maintain properties to marketing standards, where we have legal access, regardless of their location,” Joyce said. “Of the non-trust properties identified by NFHA, the vast majority of those homes have been ‘conveyed’ or transferred to HUD, which requires maintenance to HUDstandards–and approval by HUD—before they are conveyed. The remaining few houses identified by the 2012 report were immediately inspected and any issues were quickly addressed.”

NFHA lobbed a similar complaint against Bank of America. BofA SVP Dan Frahm responded that NFHA had not contacted Bank of America about the properties referenced, and if they had Bank of America would have helped to ensure the accuracy of their information.

“Bank of America applies uniform practices to the management and marketing of vacant bank-owned properties across the U.S., regardless of their location. Any suggestion to the contrary is simply untrue,” Frahm said.

According to NFHA, U.S. Bank has handled the foreclosure process in a way that has compromised safety in the communities it serves.

“Everyone deserves to live in a safe neighborhood. U.S. Bank is putting the health and safety of neighbors, including children, at risk by failing to secure these homes,” said James Perry, executive director of the Greater New Orleans Fair Housing Action Center. “U.S. Bank must address these problems immediately and stop treating foreclosed properties differently because of the racial make up of the neighborhoods where they are located.”

The Fair Housing Act makes it illegal to discriminate based on race, color, national origin, religion, sex, disability, or familial status, as well as the race or national origin of residents of a neighborhood. This law applies to housing and housing-related activities, which include the maintenance, appraisal, listing, marketing, and selling of homes.

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