A coalition of civil rights and consumer advocacy groups has filed an amicus brief in federal district court seeking to stop the motion filed by the Consumer Financial Protection Bureau (CFPB) to vacate its $105,000 redlining settlement with the mortgage company Townstone Financial Inc.
The settlement followed a protracted litigation that began in 2020 under the first Trump administration and concluded last November under the Biden administration. The CFPB claimed Townstone actively discouraged potential mortgage applicants because of their race or the racial composition of where they lived or sought to live between 2014 and 2017. In seeking to reverse the settlement, the CFPB claimed it “set out to destroy” the company using sketchy data while claiming the company was allegedly targeted for hosting a radio show that discussed “local crime, political issues around freedom of speech, supporting local law enforcement, and telling people to check out a neighborhood before buying a home.”
“CFPB abused its power, used radical ‘equity’ arguments to tag Townstone as racist with zero evidence, and spent years persecuting and extorting them – all to further the goal of mandating DEI in lending via their regulation by enforcement tactics,” said Acting CFPB Director Russ Vought in a statement.
Among the groups seeking to maintain the settlement are the National Fair Housing Alliance, Public Citizen, the American Civil Liberties Union, the Consumer Federation of America, the Fair Housing Center of Central Indiana and the National Consumer Law Center.
Lisa Rice, president and CEO of the National Fair Housing Alliance, accused the Trump administration with having “contempt for civil rights and consumer protection” and demanded that the settlement remain in effect.
“This administration is signaling in every way that it will not protect Black people and other people of color from discriminatory conduct,” Rice said. “This unconscionable reversal is the latest in a series of steps the Trump administration has taken to weaken and undermine longstanding protections and unleash an era of anti-civil rights and anti-consumer policies empowering bad actors to discriminate. It has attacked its own employees, private corporations, universities, and law firms, and now it is even attacking its own prior work. These actions leave people exposed with no mechanism for accountability or enforcement.”
