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WBK Industry News - Federal Regulatory Developments

HUD Announces Agreement between Fair Housing Project of Legal Aid of North Carolina and North Carolina-Based Bank to Resolve Allegations of Unfair Lending

HUD recently announced that the Fair Housing Project of Legal Aid of North Carolina, Inc. (a HUD Fair Housing Initiatives Program agency) and The Fidelity Bank entered into a conciliation agreement to resolve allegations of unfair mortgage lending practices against minority applicants. As part of the agreement, Fidelity agreed to make investments and community development loans in predominantly minority census tracts where at least 40% of the loans will specifically promote affordable housing, earmarking a total of at least $1 million for this purpose over the next two years.

As part of the agreement, Fidelity also agreed to apply its policies and procedures in a nondiscriminatory manner, publicly display a HUD Fair Housing poster and copies of its non-discrimination policies in both English and Spanish at the branch office at issue, and provide fair lending training to its employees engaged in loan origination, loan processing, and underwriting. HUD may engage in ongoing monitoring to ensure compliance with the agreement.

The underlying complaint was filed with HUD on February 9, 2015 and alleged that the complainant was injured by the bank’s discriminatory acts, specifically alleging discriminatory financing, discriminatory terms, conditions, or privileges or facilities in connection with financing, and otherwise denying or making housing unavailable because of race in violation of sections of Title VIII of the Civil Rights Act of 1968 as amended by the Fair Housing Act of 1988. The bank disputed the merits of the complaint and maintained that it did not engage in discriminatory acts. In entering into the agreement, neither party admitted fault, liability, or responsibility for the complainant’s alleged damages.

The HUD announcement can be found at: http://portal.hud.gov/hudportal/HUD?src=/press/press_releases_media_advisories/2016/HUDNo_16-054.

A copy of the agreement can be found at: http://portal.hud.gov/hudportal/documents/huddoc?id=16LegalAidofNC.pdf.