The U.S. Department of Justice (DOJ) announced a $9 million settlement with Ameris Bank, a wholly owned subsidiary of Ameris Bancorp (NASDAQ: ABCB) to resolve allegations that the lender engaged in redlining against predominantly Black and Hispanic communities in Jacksonville, Florida.
The DOJ claimed that Ameris Bank avoided providing mortgage services to majority-Black and Hispanic neighborhoods in Jacksonville between 2016 and 2021 and discouraged people in those communities from obtaining home loans, instead focusing disproportionately on predominantly White areas of Jacksonville. The DOJ noted that Ameris operates 18 branches in Jacksonville, but none are in majority-Black and Hispanic neighborhoods in the city.
U.S. Attorney General Merrick Garland, in a rare public appearance, announced the settlement by noting that Ameris used postcard advertising only featuring White people to illustrate their mortgage lending products and services.
As part of the settlement, Ameris will invest $7.5 million in a loan subsidy fund that will be made available to residents of majority-Black and Hispanic neighborhoods and those seeking credit in those communities. The bank will also invest $900,000 for advertising and outreach targeted toward the residents of these neighborhoods while allocating $600,000 to develop community partnerships to provide services that increase access to residential mortgage credit.
Furthermore, a new Ameris branch will be opened in a majority-Black and Hispanic neighborhood in Jacksonville and at three mortgage loan officers dedicated to serving majority-Black and Hispanic neighborhoods and a full-time Director of Community Lending will be appointed.
Palmer Proctor, CEO of Ameris, disputed the DOJ’s claims of intentional redlining.
“We strongly disagree with any suggestion that we have engaged in discriminatory conduct and are confident in our efforts to provide equal access to affordable mortgage products in the Jacksonville community and all the markets we serve,” said Proctor. “We cooperated fully with the Department’s inquiry and have entered into this settlement to avoid the distraction of litigation and because we share the Department’s goal of expanding access to homeownership in underserved areas. The terms of this settlement are consistent with the bank’s existing programs and initiatives. We condemn discrimination in any form and remain committed to helping people in underserved communities gain equal opportunity to achieve homeownership, as well as access to banking services.”
Photo courtesy Alpha Photo / Flickr Creative Commons