JPMorgan Chase has reportedly agreed to pay $55 million to settle a U.S. Department of Justice (DOJ) lawsuit accusing it of discriminating against minority borrowers by allowing mortgage brokers to charge them more for home loans.
As per a Reuters report, citing the DOJ’s complaint, mortgage brokers working on behalf of the bank overcharged at least 53,000 African-American and Hispanic borrowers between 2006 and 2009 – a violation of the Fair Housing Act and the Equal Credit Opportunity acts – simply because there were no controls in place preventing them from doing so.
At the time, Chase did not require mortgage brokers – who are basically independent contractors – to document the reasons for changing rates. The bank failed to address the racial discrimination, the DOJ says in its complaint.
In settling the allegations, the bank has not admitted to any wrongdoing.
The news comes on the same day that the U.S. Department of Labor filed a lawsuit against JPMorgan Chase claiming the bank engaged in pay discrimination against women.
A complaint filed with an administrative judge claims the bank paid at least 93 women in four different job categories less than comparable male coworkers over the last five years, Reuters reports.