Home / Business / N.J. bank agrees to record settlement with Justice Department

N.J. bank agrees to record settlement with Justice Department

“Two, four, six, eight… we ain’t gonna integrate.”

This is one of the many chants that were shouted on September 25, 1957. That was the day that the Little Rock Nine entered and attended their first day of classes at Central Rock High School. While they were set to attend classes in early September, Arkansas Governor ordered the state’s National Guard to surround the high school and stop the students from entering. It wasn’t until President Eisenhower sent over a thousand U.S. Army men to protect the nine students and demanded National Guard to obey federal orders that the students were able to enter the school weeks later. The Little Rock Nine were simply trying to make a better life for themselves through education. They were trying to access resources that were rightfully theirs as Americans. However, as it is seen, they were met with a strong resistance: racism.

While many may think we’re beyond those shameful times of racism in American society, I ponder are we really?

Last week, the Department of Justice and the Consumer Financial Bureau announced the settlement agreement of the lawsuit against Hudson City Bank. The Department of Justice and The Consumer Financial Protection Bureau alleged that Hudson City provided unequal access to credit through excluding most or all majority-Black and Hispanic neighborhoods in NY, NJ, Connecticut, and Pennsylvania.

Even after a branch expansion from 2004 to 2010, still 94% of their operating branches are located outside of majority black and Hispanic areas and instead inside affluent areas with a predominantly white demographic. These are the external stakeholders of the bank. That is, the people who have important transactions with the bank or in this case, people who potentially could have transactions with this bank. However, including information on the internal stakeholders adds even more substance to the DOJ and CFPR’s claim. Of all of the retail loan officers employed by the bank, none of them were African-American or Latino, or could speak Spanish.

Instead of going through the entire court procedure, Hudson City agreed to pay $25 million in direct loan subsidies to qualified borrowers in the affected communities, $2.25 million in community programs and outreach and a $5.5 million penalty. This $33 million agreement is the largest-ever residential-mortgage redlining settlement in the history of the DOJ.

However, the bank still remains firm on their stance of not admitting or denying any wrongdoing of bank practices. Instead, they released a statement saying that the bank “disagrees with the statistical analysis of loans relied upon by the DOJ and CFPB as the principal basis for [the] claims as well as the agencies’ conclusions from their investigations.” Many believe that Hudson City wanted to settle quickly so it can continue to work on its pending merger with M&T Corp.

Hudson City intentionally avoided inner-city areas with high minority populations. They avoided lending to the customers who lived in those neighborhoods and avoided opening up branches there too. These customers were simply trying to make a better life for themselves and access the resources that are rightfully theirs as Americans. Sharing similar aspirations with the Little Rock Nine, they too were met with a resistance. This resistance that didn’t even give them a chance or opportunity to apply for mortgage credit. And so this article, paired with mirroring of the Little Rock Nine, leave me asking the question of what is this resistance in this recent case… Veiled racism, strategic business practice and operations, or just random and unsubstantiated occurrences?



Received information from combined articles below:






About ep0803a

Check Also

Drug companies seek billion-dollar tax deductions from opioid settlement

Claire Pascocello Feb 12, 2021 The opioid epidemic kills tens of thousands of Americans each ...