Ameris Bank and the U.S. Department of Justice announced an agreement Oct. 19 over allegations the bank engaged in redlining in predominantly black and Hispanic neighborhoods in Jacksonville.
Ameris agreed to invest $9 million in the Jacksonville market under the agreement, which resulted from a Combating Redlining Initiative launched by the Justice Department two years ago.
Redlining is defined by the Justice Department as an “illegal practice in which lenders avoid providing credit services to individuals living in or seeking to live in, communities of color because of the race, color, or national origin of the residents in those communities.”
“As today’s case makes clear, redlining is not just a relic of the past,” Attorney General Merrick Garland said in a news release.
“Once today’s settlement is approved, that Initiative will have secured more than $100 million for communities across the country that have been harmed by discriminatory lending practices,” he said.
The Justice Department previously reached settlement agreements in Houston, Memphis, Philadelphia, Camden, Wilmington, Newark, Los Angeles, Columbus, Tulsa and Rhode Island.
Garland said there are two dozen other active redlining investigations in progress.
“We strongly disagree with any suggestion that we have engaged in discriminatory conduct and are confident in our efforts to provide equal access to affordable mortgage products in the Jacksonville community and all the markets we serve,” Ameris CEO Palmer Proctor said in a news release.
“We cooperated fully with the Department’s inquiry and have entered into this settlement to avoid the distraction of litigation and because we share the Department’s goal of expanding access to homeownership in underserved areas,” he said.
The Justice Department filed a complaint in U.S. District Court for the Middle District of Florida alleging Ameris disproportionately made mortgage loans in predominantly white neighborhoods over black and Hispanic neighborhoods from 2016 to 2021.
Ameris is based in Atlanta, after moving its executive offices from Jacksonville to Atlanta in 2019.
The bank still has 18 branches in the Jacksonville metropolitan area, according to Federal Deposit Insurance Corp. data.
The settlement agreement includes a provision that Ameris will open a new branch in a majority-black and Hispanic neighborhood in Jacksonville.
The $9 million includes $7.5 million in a loan subsidy fund that will be made available to residents of those neighborhoods over five years.
Ameris will also invest $900,000 in advertising and outreach programs and $600,000 to develop community partnerships to provide services that increase access to residential mortgage credit.
“Today’s agreement with Ameris Bank represents the first redlining case brought by the Department of Justice in the state of Florida and signals a step forward for black and Hispanic communities in Jacksonville that were previously denied access to economic resources for generations,” Roger Handberg, U.S. Attorney for the Middle District of Florida, said in the news release.
The agreement is subject to court approval.