Bank of America reached a settlement with the federal government over allegations of discriminatory policies against individuals with disabilities under guardianships.
According to the U.S. Department of Justice, Bank of America maintained written policies that barred adults with disabilities under legal guardianships or conservatorships from obtaining mortgages or home equity loans. These policies were in place from 2010 and lasted until Bank of America changed their policy for mortgages in 2016 and for home equity loans in 2017.
The Justice Department said these practices violate the Fair Housing Act. This act protects people from discrimination when they engage in housing-related activities, including renting or buying a home, getting a mortgage, or seeking housing assistance.
Under this settlement, Bank of America will pay $4,000 per loan to any eligible applicant impacted by these policies. It is expected that these payments will total $300,000.
Bank of America also agreed to maintain the new, non-discriminatory policies and to provide training to employees on these policies. The bank must also monitor its loan processing and underwriting to ensure compliance with the Fair Housing Act.
“No one in this free country should be denied access to the American dream merely because of a disability. The Fair Housing Act prohibits banks from denying mortgage loans and other housing-related credit to people because of their disabilities, and this department will hold accountable those lenders who engage in such illegal conduct,” says Eric Dreiband, assistant attorney general of the Justice Department’s Civil Rights Division.
Bank of America maintains that it did not discriminate against anyone because of a disability, that it extended mortgages to people with legal guardianships or conservatorships during the time in question, that the policies were put in place following the financial crisis “for the purpose of protecting at-risk applicants from financial exploitation,” and that these policies were changed voluntarily.