A former unit of Deutsche Bank has been slapped with a $12m fine for discriminating against black and Hispanic customers.
The US Department of Housing and Urban Development (HUD) said US lender MortgageIT charged black and Hispanic mortgage borrowers more than white borrowers and refused them loans more frequently.
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Bryan Greene, HUD’s acting assistant secretary for fair housing and equal opportunity, said: "It is creditworthiness and ability to pay that matter when you apply for a loan, not your race or where you come from."
Deutsche Bank disputes the allegations but has agreed to pay the fine.
MortgageIT, an indirect subsidiary bought by Deutsche Bank in 2007 and wound down in 2008, was ordered to pay compensation to the borrowers it had wrongfully denied loans or given more expensive loans than their white peers.
HUD said that the lender’s practices violated the Fair Housing Act.
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By GlobalDataIt said data from 2007-2008 showed there was respectively a 65% greater chance and a 72% greater chance of black and Hispanic borrowers being issued more expensive loans than similar white borrowers.
Deutsche Bank spokeswoman, Renee Calabro, said: "Though we deny these allegations, we are pleased to put the matter behind us."
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