On 8/30/2021, the OCC and Department of Justice (DOJ) jointly announced an agreement to resolve allegations that Cadence Bank, which is headquartered in Atlanta, engaged in lending discrimination by “redlining” predominantly Black and Hispanic neighborhoods in the Houston, metro area. Under the department’s settlement, Cadence will invest over $5.5 million to increase credit opportunities for residents of those neighborhoods.
In conjunction with this announcement, the OCC also announced that it has assessed penalties against the bank in the amount of $3 million related to the violations alleged in the department’s complaint. Specifically, the complaint alleges that, from 2013 to 2017, Cadence engaged in unlawful redlining in the Houston area by avoiding predominantly Black and Hispanic neighborhoods because of the race, color and national origin of the people living in those neighborhoods.
The DOJ also alleges that Cadence’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 and that the bank’s outreach and marketing avoided those neighborhoods.
“Redlining” is an illegal practice in which lenders avoid providing services to individuals living in communities of color because of the race, color or national origin of the people who live in those communities.
The DOJ announcement can be found here.
The original complaint can be found here.