Discrimination With A Smile

File under “Financial Sector Are Scum”:

Countrywide specialised in sub-prime mortgages, which were often granted without proper checks on criteria including the creditworthiness of borrowers.

The justice department said Countrywide had “steered” more than 10,000 minority borrowers into sub-prime mortgages, while white borrowers with similar credit profiles received prime loans.

Those sub-prime mortgage holders ended up paying more in fees and rates.

“These institutions should make judgements based on applicants’ creditworthiness, not on the colour of their skin,” Attorney General Eric Holder told reporters at a Wednesday press conference.

The justice department accused the company of abusing the trust of minority lenders, advertising that its offices had Spanish-speaking staff while charging Hispanic customers higher rates than they were qualified for.

“This is discrimination with a smile,” said Thomas Perez, head of the department’s civil rights division.

NOTE: Bank of America bought Countrywide in 2008. The settlement covers conduct between 2004 and 2008, before the BoA takeover.

(Source: BBC)