SunTrust increased loan prices for many qualified minorities, suit says
Government officials say they examined 850,000 residential mortgage loans
Settlement says 20,000 African-American and Hispanic borrowers were charged more
Richmond-based SunTrust Mortgage Inc. has agreed to pay $21 million to resolve a Justice Department lawsuit which alleged that during the boom years prior to the financial meltdown SunTrust discriminated against African-American and Hispanic borrowers.
A two-and-a-half year investigation found that between 2005 and 2009 SunTrust increased loan prices for many qualified minorities. Government officials say they examined 850,000 residential mortgage loans. The settlement filed in federal court in Richmond says 20,000 African-American and Hispanic borrowers were charged higher fees and interest rates than white borrowers based on their race or national origin.
SunTrust, the 11th largest commercial bank in the United States, is the parent of SunTrust Mortgage. Based in Atlanta, Georgia, SunTrust Bank serves the Southeast and Mid-Atlantic through 1600 branches in seven states and the District of Columbia.
“Racial and ethnic bias have no place in the lending market,” said U.S, Attorney Neil MacBride in Richmond. He said SunTrust Mortgage has cooperated in the government’s investigation, and changed its policies to prevent discrimination.
Assistant Attorney General Thomas Perez commended SunTrust mortgage for implementing strong fair lending policies “even before they knew the full results of our investigation.”