DOJ seeks $9 million settlement with Ameris Bank for redlining practices in Jacksonville

A settlement with Ameris Bank could flow $9 million into Jacksonville’s majority Black and Hispanic neighborhoods to combat modern-day redlining practices, the Department of Justice announced Thursday.

U.S. Attorney General Merrick Garland and Assistant Attorney General Kristen Clarke of the Civil Rights Division made the announcement in Jacksonville’s Eastside – one of the city’s historically Black neighborhoods affected by redlining, a type of housing discrimination with roots in the 1930s.

The DOJ alleged the bank kept Jacksonville communities of color from lending opportunities for years, contributing to a systematic economic decline.

“By taking on the discriminatory lending practices of banks and mortgage companies, we're helping to ensure that more Black, Hispanic and other communities of color are able to buy a home, generate wealth and fulfill the American dream,” Clarke said. “This settlement marks a new pinnacle in our efforts to bring an end to redlining and provides tangible relief to communities that have been starved of access to credit for far too long.”

Ameris issued a statement after the press conference disagreeing "with any suggestion that we have engaged in discriminatory conduct." The company's CEO, Palmer Proctor, said the bank cooperated with the DOJ's investigation and agreed to the settlement to "avoid the distraction of litigation" and focus on providing housing opportunities.

"The terms of this settlement are consistent with the bank’s existing programs and initiatives," Proctor said. "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.”

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Garland and Clarke are the most recent figures to visit the city as Jacksonville – and the state at large – has become a significant talking point in national conversations regarding racial equity. Politicians have zoomed in on the city in recent months to criticize Gov. Ron DeSantis’ educational policies and decry access to semi-automatic weapons.

Locally, state representatives for the city called on the DOJ in August to investigate the Duval County Jail for a rise in its death rate among inmates, as reported by Jacksonville’s The Tributary. The office inputted the request for internal review, but Garland did not provide an update during Thursday’s press conference.

The Jacksonville settlement is the latest in the office’s “Combat Redlining Initiative” that began in 2021. The DOJ alleged Ameris Bank, based in Atlanta, failed “to open even a single branch” in a majority Black or Hispanic neighborhood, but opened 18 full-service branches elsewhere in the city.

The bank additionally closed the only branch in a minority neighborhood during an “efficiency initiative” despite calling the branch one of its “best financial performers” in the country, Garland said.

If approved by a federal judge, the DOJ said the settlement will establish the following:

• Invest $7.5 million in a loan subsidy fund that will be made available to residents of majority-Black and Hispanic neighborhoods and those seeking credit in those communities.

• Invest $900,000 for advertising and outreach targeted toward the residents of these neighborhoods.

• Invest $600,000 to develop community partnerships to provide services that increase access to residential mortgage credit.

• Open a new branch in a majority-Black and Hispanic neighborhood in Jacksonville.

• Ensure that at least three mortgage loan officers are dedicated to serving majority-Black and Hispanic neighborhoods.

• Retain a consultant to assess the bank’s compliance management system as it pertains to redlining risk.

Employ a full-time director of community lending who will oversee the continued development of lending in majority-Black and Hispanic neighborhoods in Jacksonville.

Redlining has come in recent years to recognize a wide application of housing discrimination against communities of color, which is illegal under the Fair Housing Act and the Equal Credit Opportunity Act, but the coordinated practice began in the 1930s.

Redlining became a segregation tool in the aftermath of the Great Depression when the federal government mapped cities across the country to guide banks away from neighborhoods with perceived lending risks. This predominantly placed communities of color, primarily Black communities, “in the red” and kept Black residents from obtaining home improvement loans, mortgages or refinancing options.

In Jacksonville, the practice allowed neighborhoods with a majority of white residents to grow and thrive while property values dropped in areas like the Eastside.

“But as today’s case makes clear, redlining is not just a relic of the past,” Garland said. “Indeed, some of the neighborhoods that we allege Ameris redlined are some of the same neighborhoods that federal agencies originally redlined beginning in the 1930s.”

This article originally appeared on Florida Times-Union: AG Garland seeks Ameris Bank redlining settlement in Jacksonville