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Press Release

Justice Department Announces New Initiative to Combat Redlining

For Immediate Release
U.S. Attorney's Office, Western District of Tennessee
DOJ, CFPB and OCC Announce Resolution of Lending Discrimination Claims Against Trustmark National Bank

Memphis, TN – Today the Department of Justice, the U.S. Attorney’s Office for the Western District of Tennessee, the Consumer Financial Protection Bureau (CFPB) and the Office of the Comptroller of the Currency (OCC) announced an agreement to resolve allegations that Trustmark National Bank engaged in lending discrimination by redlining predominantly Black and Hispanic neighborhoods in Memphis, Tennessee. "Redlining" is an illegal practice in which lenders avoid providing services to individuals living in communities of color because of the race or national origin of the people who live in those communities.

"Enforcement of fair lending laws is a priority for the Civil Rights Division. Our fair lending laws enable us to hold banks and lenders accountable when they fail to serve communities of color in our country. Having fair access to mortgage lending opportunities is the cornerstone on which families and communities can build wealth," said Assistant Attorney General Kristen Clarke of the Civil Rights Division. "This settlement makes clear our commitment to ensuring equal access to lending opportunities for all communities, regardless of race or national origin."

"Home ownership," said Joseph C. Murphy, Jr., Acting United States Attorney for the Western District of Tennessee, "is the foundation of economic success for most American families. Fair lending practices required by federal law - and the enforcement of those laws - ensure a better future for all Americans. Our office believes that enforcement actions of this type are essential to fair lending system that benefits everyone, and we will continue to prioritize these cases."

The parties’ proposed consent order was filed today in conjunction with a complaint in the U.S. District Court for the Western District of Tennessee. The complaint alleges that Trustmark National Bank violated the Fair Housing Act and the Equal Credit Opportunity Act, which prohibit financial institutions from discriminating on the basis of race, color, or national origin in their mortgage lending services. The complaint also alleges that Trustmark National Bank violated the Consumer Financial Protection Act, which prohibits offering or providing to a consumer any financial product or service not in conformity with federal consumer financial law.

Specifically, the complaint alleges that, from 2014 to 2018, Trustmark engaged in unlawful redlining in Memphis by avoiding predominantly Black and Hispanic neighborhoods because of the race, color, and national origin of the people living in, or seeking credit for properties in, those neighborhoods. The complaint also alleges that Trustmark’s branches were concentrated in majority-white neighborhoods, that the bank’s loan officers did not serve the credit needs of majority-Black and Hispanic neighborhoods, that Trustmark’s outreach and marketing avoided those neighborhoods, and that Trustmark’s internal fair-lending policies and procedures were inadequate to ensure that the bank provided equal access to credit to communities of color.

The department opened its investigation after one of Trustmark’s regulators, the OCC, referred the matter. Trustmark has fully cooperated in this investigation and amicably resolved the allegations.

"Trustmark purposely excluded and discriminated against Black and Hispanic communities," said Director Rohit Chopra of the Consumer Financial Protection Bureau (CFPB). "The federal government will be working to rid the market of racist business practices, including those by discriminatory algorithms."

"The OCC has had a long history of strong partnership with the Justice Department’s Housing and Civil Enforcement Section of the Civil Rights Division, referring potential fair lending violations and sharing our extensive examiner, economist and legal findings, as we did in the Trustmark matter," said Acting Comptroller of the Currency Michael J. Hsu. "Today’s announcement is important because it signifies the unified and unmitigated focus that each of our agencies has placed on the enforcement of the Fair Housing Act and the Equal Credit Opportunity Act. Our collective efforts are critical to addressing the discriminatory lending practices that create and reinforce racial inequity in the financial system."

Under the proposed consent order:

• Trustmark will invest $3.85 million in a loan subsidy fund to increase credit opportunities for current and future residents of predominantly Black and Hispanic neighborhoods in the Memphis area; dedicate at least four mortgage loan officers or community lending specialists to these neighborhoods; and open a loan production office in a majority-Black and Hispanic neighborhood in Memphis.

• Trustmark will devote $400,000 to developing community partnerships to provide services to residents of majority-Black and Hispanic neighborhoods in Memphis that increase access to residential mortgage credit.

• Trustmark will devote at least $200,000 per year to advertising, outreach, consumer financial education, and credit repair initiatives in and around Memphis.

• Trustmark will pay a total civil money penalty of $5 million to the OCC and CFPB.

• Trustmark already has established a Fair Lending Oversight Committee and designated a Community Lending Manager who will oversee these efforts and work in close consultation with the Bank’s leadership.

The Justice Department’s enforcement of fair lending laws is conducted by the Civil Rights Division’s Housing and Civil Enforcement Section. Additional information about the Section’s fair lending enforcement can be found at Individuals may report lending discrimination by calling the Justice Department’s Housing Discrimination Tip Line at 1-833-591-0291, or submitting a report online.



Cherri Green
Public Affairs
(901) 544-4231

Updated October 22, 2021