JACKSONVILLE, Fla. – Georgia-based Ameris Bank has been accused by the Department of Justice of systematically denying and discouraging home loans and other credit to those living in Black and Hispanic neighborhoods in Jacksonville.
Attorney General Merrick Garland announced the accusations against the major bank during a Thursday morning news conference at a Jacksonville Boys & Girls Club.
Garland said Ameris Bank engaged in the practice of redlining, where lenders deny, discourage or avoid providing loans in neighborhoods because of the race, color or national origin of the people living in those neighborhoods.
Garland laid out specific allegations against the bank and said Ameris has agreed to pay $9 million to expand access to credit opportunities for Black and Hispanic neighborhoods in Jacksonville if the settlement agreement is approved by the courts.
The DOJ alleged that the bank located its branches in specific areas of Jacksonville to serve majority-white neighborhoods and to avoid serving Black and Hispanic neighborhoods. This included failing to open even a single branch in a majority-Black and Hispanic neighborhood in Jacksonville, despite having opened 18 full-service branches in other parts of Jacksonville.
“For example, we allege that, in 2019, Ameris closed two of its Jacksonville branches as part of a so-called ‘efficiency initiative.’ Ameris had identified both of those branches as having “minority” populations “higher” than other nearby branch locations,” Garland said. “One of those branches, which was located within what Ameris called the ‘urban core’ of Jacksonville, was the closest branch to most of the city’s majority-Black and Hispanic neighborhoods.”
Garland said that the branch was closed despite the fact that Ameris itself rated it as one of the “best financial performers” of all of its branches across the United States. Ameris did not close any branches in the majority-white areas of Jacksonville as part of this so-called “efficiency initiative,” he said.
In another example, Garland said that in 2020, Ameris sent out a “free checking mailer” that the bank said was targeted to low-and moderate-income areas in majority-minority neighborhoods. Ameris mailed over 22,000 postcards with images of white models to 13 ZIP codes in Jacksonville. Not one postcard was sent to a single resident in a majority-Black and Hispanic neighborhood, Garland said.
Between 2016 and 2021, DOJ said other lending institutions comparable to Ameris generated loan applications from residents of majority-Black and Hispanic neighborhoods at over three times the rate generated by Ameris.
DOJ said the majority of the $9 million in relief that Ameris will pay under the consent order will be in the form of loan subsidy funds. These funds can be used by residents for down payments, to lower their interest rates, or to make home improvements that will increase the value of their homes.
In addition, the settlement requires Ameris to open or acquire its first full-service branch located in a majority-Black and Hispanic neighborhood in Jacksonville. That branch will be located downtown in a retail-oriented, visible location.
In a statement, Ameris Bank said it “firmly denies violating, and maintains that it has consistently complied with, applicable fair lending laws.”
“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,” said Palmer Proctor, CEO of Ameris. “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. The terms of this settlement are consistent with the Bank’s existing programs and initiatives. We condemn discrimination in any form and remain committed to helping people in underserved communities gain equal opportunity to achieve homeownership, as well as access to banking services.”
Under the terms of the settlement, Ameris said it will provide $7.5 million in mortgage loan subsidies over a five-year period in majority Black and Hispanic Census Tracts in Jacksonville. The bank said it will also commit, for the same five-year period, $900,000 for focused advertising and outreach and $600,000 for community development partnerships providing services related to credit, financial education, homeownership, and foreclosure prevention.
The bank said the settlement does not include any civil monetary penalties.
Two years ago Garland launched the “Combating Redlining Initiative” and since then DOJ has reached a total of 10 settlements with lending institutions to resolve allegations of redlining.
The initiative has resulted in more than $100 million for communities across the country that have been harmed by discriminatory lending practices, Garland said.