American Bank of Oklahoma has reached a settlement with the U.S. Department of Justice to settle charges of lending discrimination by redlining in Tulsa.
The bank was accused of failing to provide mortgage lending services to majority-Black and Hispanic neighborhoods in the Tulsa metropolitan area between 2017 and 2021. The bank was also accused of locating all its branches and loan production offices in majority-white neighborhoods, designating a service area that excluded all majority-Black and Hispanic-census tracts in the metropolitan area and failing to monitor and address fair lending risk.
As part of the settlement, American Bank of Oklahoma has agreed to invest over $1.15 million to increase credit opportunities in neighborhoods of color in the Tulsa metropolitan area, with at least $950,000 in a loan subsidy fund for residents of majority-Black and Hispanic neighborhoods in the Tulsa area, $100,000 for advertising, outreach and consumer education, and $100,000 for development of community partnerships to provide services that increase access to residential mortgage credit.
The bank will also open a new community-oriented loan production office in the historically Black area of Tulsa, ensure at least two mortgage loan officers are dedicated to serving majority-Black and Hispanic neighborhoods in and around Tulsa, host at least six consumer financial education seminars per year (which will include Spanish translations), and employ a full-time director of community lending to oversee lending in neighborhoods of color in the Tulsa area.
“Providing equal access to credit is essential in every community, but the painful history of Tulsa makes this agreement particularly poignant because the redlined areas include historically Black neighborhoods that have endured the legacy of racial violence and the continuing effects of segregation and discrimination,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division.
In announcing the settlement, the Justice Department noted that some of the communities where the alleged redlining occurred were the site of the 1921 Tulsa Race Massacre. American Bank of Oklahoma was founded in 1998, and the $383 million-asset community bank has branches in Collinsville, Disney, Muskogee, Ramona and Skiatook.
In a statement, the bank denied the allegations brought against it but said it “agreed to resolve the matter to avoid the cost and distraction of protracted litigation.” Joe Landon, chairman and CEO and the bank, welcomed the settlement as an opportunity to expand its banking footprint.
“We are excited about the opportunity to apply our community banking model in north and northeast Tulsa and look forward to expanding ways we can help members of the communities with their banking and lending needs,” said Landon.
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