U.S. BANK ACCUSED OF RACIAL DISCRIMINATION IN THE MAINTENANCE OF FORECLOSED PROPERTIES IN PALM BEACH COUNTY

 

WASHINGTON, D.C. – Today, the National Fair Housing Alliance,  Fair Housing Center of the Greater Palm Beaches and two other member organizations announced new evidence of housing discrimination by Minneapolis-based U.S. Bank.  The civil rights groups allege that U.S. Bank fails to maintain and market bank-owned foreclosures (also known as real estate owned or REO properties) in African American and Latino neighborhoods to the same standard as in White neighborhoods, a practice that violates the federal Fair Housing Act.

The complaint was initially filed with the U.S. Department of Housing and Urban Development (HUD) in October 2012.  Evidence gathered from 2010 through September 2014 documents an ongoing pattern and practice of discrimination by U.S. Bank.  New evidence of discrimination continues to emerge, so NFHA and its partners are amending the original complaint for the third time.  Currently, NFHA and its partners have investigated 489 REOs owned by U.S. Bank in 41 cities across the United States.

 “U.S. Bank has made a practice of not maintaining its foreclosures in neighborhoods of color,” said Shanna L. Smith, President and CEO of the National Fair Housing Alliance.  “The foreclosure crisis hit these middle- and working-class communities hardest, and what we’re seeing now is an illegal pattern of neglect that lowers property values, creates safety and health risks for neighbors, and contributes to community blight.  City governments and people living next to U.S. Bank foreclosures simply ask that the bank conduct routine maintenance, such as keeping the grass cut, securing windows and doors, and clearing debris and trash from the lawn and porch.  U.S. Bank must be held accountable for its discrimination and adhere to basic standards of maintenance in every neighborhood.”

The fair housing organizations investigated the maintenance and marketing of bank-owned foreclosed homes for 39 different types of deficiencies, including broken windows and doors, broken and obstructed gutters and downspouts, accumulated trash, overgrown lawns and shrubs, no “for sale” signs, and other issues that affect curb appeal, the security of the home, and the value of the property.

 This third amended complaint adds data from investigations in Palm Beach County, Denver, Colo., Minneapolis, Minn., and Orlando, Fla.  

 The overall complaint encompasses neighborhoods in 19 metro regions.  The three organizations joining NFHA in submitting new evidence of discrimination are Fair Housing Center of the Greater Palm Beaches (Palm Beaches), Denver Metro Fair Housing Center (Denver), and Fair Housing Continuum, Inc. (Orlando).

 “U.S. Bank is liable for the differences in treatment between white neighborhoods and Latino and African American neighborhoods.  U.S. Bank likes to say that it is simply the trustee for the homes and not the servicer, but U.S. Bank knows the Fair Housing Act makes owners, even trustees, accountable under the law,” said Shanna Smith. 

“People in Greater Palm Beaches work hard to keep their neighborhoods safe and vibrant,” said Vince Larkins, President and CEO of Fair Housing Center of the Greater Palm Beaches.  “The damage that U.S. Bank has inflicted on these neighborhoods is shocking.  Would you want to live next to a house littered with trash and infested with rodents?  Floridians certainly don’t.”

The groups found that U.S. Bank properties in communities of color had excessive trash, unsecured doors and windows, overflowing mail, and overgrown lawns, while most U.S. Bank properties in predominantly white communities did not.  These problems require simple fixes and are the responsibility of the bank and its contractors.”U.S. Bank must take measures to address this clear disparity in upkeep,” said David Baade, President and CEO of Fair Housing Continuum.  “We found homes infested with fleas and carpenter ants creating health issues for neighbors and certainly deterring buyers from considering the house. Orlando deserves better.”

“We saw these differences again and again in African American and Latino neighborhoods in Denver,” said Arturo Alvarado, Executive Director of the Denver Metro Fair Housing Center. “If U.S. Bank can mow lawns, secure doors, and clear gutters in White neighborhoods, it can do it anywhere.  There is simply no excuse for this discriminatory behavior.”The Fair Housing Act makes it illegal to discriminate based on race, color, national origin, religion, sex, disability, or familial status, as well as on the race or national origin of residents of a neighborhood.  This law applies to housing and housing-related activities, which include the maintenance, appraisal, listing, marketing, and selling of homes.

CITY-SPECIFIC INFORMATION FOR U.S. BANK

Full data available at www.nationalfairhousing.org

Greater Palm Beaches, Fla.:

• 50.0% of REO properties in communities of color had more than 10 maintenance or marketing deficiencies while none of the REO properties in White communities had more than 10 deficiencies.

• 50.0% of REO properties in communities of color had broken or boarded windows while none of the REO properties in predominantly White communities had the same problem.  

Denver, Colo.:

• REO properties in communities of color were 2.6 times more likely to have overgrown or dead shrubbery on the premises compared to REO properties in White communities (21.4% of REO properties in communities of color had overgrown or dead shrubbery while only 8.3% of REO properties in predominantly White communities had the same deficiency).

• REO properties in communities of color were 3.4 times more likely to have broken or boarded windows compared to REO properties in White communities (28.6% of REO properties in communities of color had broken or boarded windows while only 8.3% of REO properties in predominantly White communities had the same problem).

Minneapolis, Minn.:

• REO properties in communities of color were 4.4 times more likely to have an unsecured, broken, or boarded door compared to REO properties in White communities (44.4% of REO properties in communities of color had an unsecured, broken, or boarded door while only 10.0% of REO properties in predominantly White communities had the same problem).

• REO properties in communities of color were 2.8 times more likely to have holes in the structure of the property compared to REO properties in White communities (27.8% of REO properties in communities of color had holes in the structure while only 10.0% of REO properties in predominantly White communities had the same problem).

Orlando, Fla.:

• REO properties in communities of color were 1.7 times more likely than REO properties in White communities to have 15 or more maintenance or marketing deficiencies (50.0% of REO properties in communities of color had 15 or more maintenance or marketing deficiencies, while only 30.0% of REO properties in predominantly White communities had 15 or more maintenance or marketing deficiencies).

• REO properties in communities of color were 1.6 times more likely to have broken or boarded windows compared to REO properties in White communities (65.0% of REO properties in communities of color had broken or boarded windows, while only 40.0% of REO properties in predominantly White communities had the same problem).

National Fair Housing Alliance:

Founded in 1988, the National Fair Housing Alliance is a consortium of more than 220 private, non-profit fair housing organizations, state and local civil rights agencies, and individuals from throughout the United States.  Headquartered in Washington, D.C., the National Fair Housing Alliance, through comprehensive education, advocacy, and enforcement programs, provides equal access to apartments, houses, mortgage loans, and insurance policies for all residents in the nation.

 

Fair Housing Center of the Greater Palm Beaches:

The FHC is a full service, community-based fair housing agency which provides comprehensive Fair Housing Services throughout the State of Florida.  The FHC is the only agency in Palm Beach County whose sole purpose is the eradication of one of the last vestiges of “Jim Crow” in our society today, housing discrimination.

Denver Metro Fair Housing Center:

The Denver Metro Fair Housing Center is a private non-profit fair housing enforcement agency serving 6 Denver Metro Counties: Adams, Arapahoe, Broomfield, Denver, Douglas, and Jefferson.  DMFHC is dedicated to eliminating housing discrimination and promoting housing choice through education, advocacy, and enforcement of fair housing laws.  DMFHC accepts complaints from individuals and families who believe they have been discriminated against in their pursuit of housing.  DMFHC investigates the complaints and assists clients in finding the best remedies to their fair housing issues.

Fair Housing Continuum:

The Fair Housing Continuum, Inc. is a private non-profit fair housing agency dedicated entirely to the elimination of housing discrimination in Florida, serving Brevard, Indian River, Seminole, Osceola, Orange and Volusia Counties.