Excerpt
JEFFREY BROWN (Newshour): The U.S. Justice Department announced a major settlement today over alleged racial bias in home mortgage lending. Bank of America agreed to pay $335 million in a case involving Countrywide Mortgage, which the bank bought in 2008.
Attorney General Eric Holder said Countrywide engaged in systematic discrimination against blacks and Hispanics.
ERIC HOLDER, U.S. attorney general: Now, these allegations represent alarming conduct by one of the largest mortgage lenders in the country during the height of the housing market boom. For example, in 2007, a qualified African-American customer in Los Angeles borrowing $200,000 paid an average of roughly $1,200 more in fees than a similarly qualified white borrower.
JEFFREY BROWN: The settlement stems from an investigation that began in 2008.
Two years later, Illinois Attorney General Lisa Madigan filed her own lawsuit, and she worked with the Department of Justice to gain today's settlement.
Humm.... one has to wonder if BofA regrets buying Countrywide Mortgage?
This also high-lights the issue of loan brokers being paid in accordance with the loans they sell, or on commission (which is a common practice). If you want to stop abuse, just pay them a fixed salary.
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