Editing Redlining (section)

== Efforts to end ==

=== Legislation ===

In the United States, the [[Fair Housing Act of 1968]] was passed to combat the practice of redlining. According to the Department of Housing and Urban Development, "The Fair Housing Act makes it unlawful to discriminate in the terms, conditions, or privileges of sale of a dwelling because of race or national origin. The Act also makes it unlawful for any person or entity involved in residential real estate-related transactions to discriminate against any person in making available such a transaction, or in the terms or conditions of such a transaction, because of race or national origin."<ref name=HUDNo_15-064b>{{Cite web |title=HUDNo_15-064 |url=https://portal.hud.gov/hudportal/HUD?src=/press/press_releases_media_advisories/2015/HUDNo_15-064b |website=portal.hud.gov |access-date=2017-03-08 |url-status=dead |archive-date=2017-03-08 |archive-url=https://web.archive.org/web/20170308221250/https://portal.hud.gov/hudportal/HUD?src=%2Fpress%2Fpress_releases_media_advisories%2F2015%2FHUDNo_15-064b}}</ref>  The [[Office of Fair Housing and Equal Opportunity]] is tasked with administering and enforcing this law.

The Equal Credit Opportunity Act (ECOA), codified at 15 U.S.C. § 1691 et seq., was enacted on October 28, 1974.<ref>{{cite web |title=15 USC CHAPTER 41, SUBCHAPTER IV: EQUAL CREDIT OPPORTUNITY |url=https://uscode.house.gov/view.xhtml?req=granuleid%3AUSC-prelim-title15-chapter41-subchapter4&edition=prelim |website=uscode.house.gov}}</ref> This law makes it unlawful for any creditor to discriminate against any applicant regarding any aspect of a credit transaction based on race, color, religion, national origin, sex, marital status, or age (provided the applicant has the capacity to contract).<ref>{{cite web |title=Civil Rights Division {{!}} The Equal Credit Opportunity Act |url=https://www.justice.gov/crt/equal-credit-opportunity-act-3 |website=www.justice.gov |language=en |date=6 August 2015}}</ref>  It also prohibits discrimination based on the applicant's income deriving from a public assistance program or the applicant's good faith exercise of any right under the Consumer Credit Protection Act. The ECOA applies to any person who regularly participates in credit decisions,<ref>{{cite web |title=Federal Register :: Request Access |url=https://www.ecfr.gov/current/title-12/chapter-II/subchapter-A/part-202 |website=unblock.federalregister.gov}}</ref> including banks, retailers, bankcard companies, finance companies, and credit unions.

The part of the law that defines its authority and scope is known as Regulation B, referenced as 12 C.F.R. § 1002.1(b) (2017).<ref>{{cite web |title=Federal Register :: Request Access |url=https://www.ecfr.gov/current/title-12/chapter-X/part-1002 |website=unblock.federalregister.gov}}</ref> from the (b) that appears in Title 12 part 1002's official identifier: 12 C.F.R. § 1002.1(b) (2017).<ref name="auto">{{cite web |title=§ 1002.1 Authority, scope and purpose. |url=https://www.consumerfinance.gov/rules-policy/regulations/1002/1/ |website=Consumer Financial Protection Bureau |language=en}}</ref> Failure to comply with Regulation B can subject a financial institution to civil liability for actual and punitive damages in individual or class actions. Liability for punitive damages can be as much as $10,000 in individual actions and the lesser of $500,000 or 1% of the creditor's net worth in class actions.<ref name="auto"/>

The [[Community Reinvestment Act]] (CRA), passed by Congress in 1977, requires banks to apply the same lending criteria in all communities.<ref>{{cite book |title=Comeback Cities: A Blueprint for Urban Neighborhood Revival |author1=Paul S. Grogan |author2=Tony Proscio |isbn=978-0-8133-3952-8 |year=2002 |page=114 |publisher=Basic Books |quote=The goal was not to relax lending restrictions but rather to get banks to apply the same criteria to residents in the inner-city as in the [[suburbs]]. }}{{Dead link|date=July 2023 |bot=InternetArchiveBot |fix-attempted=yes }}</ref>

=== Regulatory lawsuits ===
In May 2015, the [[United States Department of Housing and Urban Development|U.S. Department of Housing and Urban Development]] announced that [[Associated Banc-Corp|Associated Bank]] had agreed to a $200 million settlement over redlining in Chicago and Milwaukee. The three-year HUD observation led to the complaint that the bank purposely rejected mortgage applications from black and Latino applicants.<ref name=HUDNo_15-064b/> The final settlement required AB to open branches in non-white neighborhoods.<ref>{{Cite news |url=http://www.housingwire.com/articles/33998-associated-bank-settles-with-hud-over-discriminatory-lending |title=Associated Bank settles with HUD over discriminatory lending |access-date=2017-03-08}}</ref>

[[Attorney General of New York|New York Attorney General]] [[Eric Schneiderman]] announced a settlement with Evans Bank for $825,000 on September 10, 2015. An investigation had uncovered the erasure of black neighborhoods from mortgage lending maps.<ref>{{Cite news |date=2015-09-10 |url=https://www.nytimes.com/2015/09/11/business/dealbook/evans-bank-settles-new-york-redlining-lawsuit.html |title=Evans Bank Settles New York 'Redlining' Lawsuit |last1=Silver-Greenberg |first1=Jessica |last2=Corkery |first2=Michael |work=The New York Times |access-date=2017-03-08 |url-access=subscription |url-status=live |archive-url=https://web.archive.org/web/20150918072445/https://www.nytimes.com/2015/09/11/business/dealbook/evans-bank-settles-new-york-redlining-lawsuit.html |archive-date=September 18, 2015 }}</ref> According to Schneiderman, of the over 1,100 mortgage applications the bank received between 2009 and 2012, only four were from African Americans.<ref>{{Cite web |url=https://ag.ny.gov/press-release/ag-schneiderman-secures-agreement-evans-bank-ending-discriminatory-mortgage-redlining |title=A.G. Schneiderman Secures Agreement With Evans Bank Ending Discriminatory Mortgage Redlining In Buffalo {{!}} New York State Attorney General |website=ag.ny.gov |access-date=2017-03-08 |archive-url=https://web.archive.org/web/20180130080121/https://ag.ny.gov/press-release/ag-schneiderman-secures-agreement-evans-bank-ending-discriminatory-mortgage-redlining |archive-date=2018-01-30 |url-status=dead}}</ref> Following this investigation, ''[[The Buffalo News]]'' reported that more banks could be investigated for the same reasons in the near future. The most notable examples of such DOJ and HUD settlements have focused heavily on community banks in large metropolitan areas, but banks in other regions have been the subject of such orders as well, including First United Security Bank in Thomasville, Alabama, and Community State Bank in Saginaw, Michigan.<ref>{{Cite web |url=http://buffalonews.com/2014/09/02/evans-bancorp-isnt-only-lender-at-risk-of-redlining-lawsuit/ |title=Evans Bancorp isn't only lender at risk of redlining lawsuit |last=Glynn |first=Matt |date=2014-09-02 |website=The Buffalo News |access-date=2017-03-08 |archive-date=March 8, 2017 |archive-url=https://web.archive.org/web/20170308224601/http://buffalonews.com/2014/09/02/evans-bancorp-isnt-only-lender-at-risk-of-redlining-lawsuit/ |url-status=dead }}</ref>

The [[United States Department of Justice]] announced a $33 million settlement with [[Hudson City Savings Bank]], which services [[New Jersey]], [[New York (state)|New York]], and [[Pennsylvania]], on September 24, 2015.<ref>{{Cite web|url=https://www.justice.gov/opa/file/777866/download|title=CONSUMER FINANCIAL PROTECTION BUREAU, and UNITED STATES OF AMERICA, v. HUDSON CITY SAVINGS BANK, F.S.B.}}</ref> The six-year DOJ investigation had proven that the company was intentionally avoiding granting mortgages to Latinos and African Americans and purposely avoided expanding into minority-majority communities. The Justice Department called it the "largest residential mortgage redlining settlement in its history."<ref>{{Cite web |url=https://www.justice.gov/opa/pr/justice-department-and-consumer-financial-protection-bureau-reach-settlement-hudson-city |title=Justice Department and Consumer Financial Protection Bureau Reach Settlement with Hudson City Savings Bank to Resolve Allegations of Mortgage Lending Discrimination |website=www.justice.gov |access-date=2017-03-08 |date=2015-09-24}}</ref> As a part of the settlement agreement, HCSB was forced to open branches in non-white communities. As U.S. Attorney Paul Fishman explained to Emily Badger for ''[[The Washington Post]]'', "[i]f you lived in a majority-black or Hispanic neighborhood and you wanted to apply for a mortgage, Hudson City Savings Bank was not the place to go." The enforcement agencies cited additional evidence of discrimination in Hudson City's broker selection practices, noting that the bank received 80 percent of its mortgage applications from mortgage brokers but that the brokers with whom the bank worked were not located in majority African-American and Hispanic areas.<ref>{{Cite news |url=https://www.washingtonpost.com/news/wonk/wp/2015/09/25/what-it-looks-like-when-a-bank-structures-its-business-to-avoid-minorities/ |title=What it looks like when a bank goes out of its way to avoid minorities |newspaper=[[The Washington Post]] |access-date=2017-03-08}}</ref>

On January 12, 2023, [[City National Bank (California)|City National Bank of California]] agreed to pay $31,000,000 to resolve allegations of redlining from 2017 to at least 2020, brought by the [[United States Department of Justice]].<ref>{{Cite web |date=2023-01-12 |title=Justice Department Secures Over $31 Million from City National Bank to Address Lending Discrimination Allegations |url=https://www.justice.gov/opa/pr/justice-department-secures-over-31-million-city-national-bank-address-lending-discrimination |access-date=2023-01-13 |website=www.justice.gov}}</ref>

=== Community organizations ===
[[ShoreBank]], a community-development bank in [[Chicago]]'s [[South Shore, Chicago|South Shore]] neighborhood, was a part of the private sector fight against redlining.<ref name="shorebank">{{cite web |last=Douthwaite |first=Richard |title=HOW A BANK CAN TRANSFORM A NEIGHBOURHOOD |website=Short Circuit |url=http://www.feasta.org/documents/shortcircuit/index.html?sc4/shorebank.html |access-date=January 8, 2007}}</ref> Founded in 1973, ShoreBank sought to combat racist lending practices in Chicago's [[African-American]] communities by providing financial services, especially mortgage loans, to local residents.<ref>{{cite web |last=Thomsen |first=Mark |date=2001-10-01 |title=ShoreBank Surpasses $1 Billion in Community Development Investment |website=Social Funds |url=http://www.socialfunds.com/news/article.cgi/673.html |url-status=dead |archive-date=2012-09-10 |archive-url=https://archive.today/20120910162601/http://www.socialfunds.com/news/article.cgi/673.html |access-date=January 8, 2007}}</ref> In a 1992 speech, then-Presidential candidate [[Bill Clinton]] called ShoreBank "the most important bank in America".<ref name="shorebank"/> On August 20, 2010, the bank was declared insolvent, closed by regulators and most of its assets were acquired by [[Urban Partnership Bank]].

In the mid-1970s, community organizations, under the banner of the NPA, worked to fight against redlining in South Austin, Illinois. One of these organizations was SACCC ([[South Austin Coalition Community Council]]), formed to restore South Austin's neighborhood and to fight against financial institutions accused of propagating redlining. This got the attention of insurance regulators in the Illinois Department of Insurance, as well as federal officers enforcing anti-racial discrimination laws.<ref>{{Cite web |url=http://archives.chicagotribune.com/1981/02/14/page/S8/article/combatting-redlining-in-austin |title=Combatting redlining in Austin |date=February 14, 1981 |access-date=2017-03-16 |work=Chicago Tribune}}{{dead link|date=February 2020}}</ref>