PHILADELPHIA (KYW Newsradio, Associated Press) — A Pennsylvania mortgage company owned by billionaire businessman Warren Buffett’s Berkshire Hathaway discriminated against potential Black and Latino homebuyers in Philadelphia, New Jersey and Delaware, the Department of Justice said Wednesday, in what it is calling the second-largest redlining settlement in history.
Trident Mortgage Co., a division of Berkshire’s HomeServices of America, deliberately avoided writing mortgages in minority-majority neighborhoods in West Philadelphia like Malcolm X Park; Camden, New Jersey; and in Wilmington, Delaware; the DOJ and the Consumer Financial Protection Bureau said in their settlement with Trident. As part of the agreement with the DOJ and the CFPB, Trident will have to set aside $20 million to make loans in underserved neighborhoods.
The DOJ alleged that between 2015 and 2019 the employees of Trident, which stopped writing mortgages in 2020, made racist comments about making loans to Black homebuyers, calling certain neighborhoods “ghettos.” One manager of Trident was photographed posing in front of the Confederate flag. The marketing materials used by Trident involved exclusively white individuals, and nearly all of the company’s staff were white.
Josh Shapiro, Pennsylvania’s attorney general who is running for governor, called the behavior by Trident “systematic racism, pure and simple.”
Philadelphia has a long history of racism toward Black homebuyers that even to this day is not resolved. Philadelphia City Council released a report Wednesday that found that 95% of all of Philly’s home appraisers were white and a racial gap remains between how homes owned by Black homeowners are valued versus homes owned by white owners.
Related
“Trident’s unlawful redlining activity denied communities of color equal access to residential mortgages, stripped them of the opportunity to build wealth, and devalued properties in their neighborhoods,” said Kristen Clarke, an assistant attorney general of the Justice Department’s Civil Rights Division, in a prepared statement.
Trident also agreed to hire mortgage loan officers in impacted neighborhoods as well as pay a monetary fine of $4 million. Since Trident no longer operates, a separate company will be contracted to provide the $20 million in loan subsidies, the DOJ said.
City Council President Darrell Clarke said this historic settlement is a long-awaited one.
“This is so significant because it allows people of color to be able to access housing, build family wealth, build generational wealth,” he said. “The home is probably the most significant thing that you will ever purchase in your life.”
Related
Trident also agreed to hire mortgage loan officers in impacted neighborhoods as well as pay a monetary fine of $4 million. Since Trident no longer operates, a separate company will be contracted to provide the $20 million in loan subsidies, the DOJ said.
The company must also conduct anti-bias training and community outreach. State Sen. Vincent Hughes of Philadelphia said this move puts other lenders on notice.
“What this says to them is that someone is paying attention, someone is going to hold them accountable, someone is going to watch over them,” he said. “This is the beginning but it can’t be the end.”
Related
