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BancorpSouth Mortgage Center

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What credit unions can learn from BancorpSouth fair lending woes

BancorpSouth Bank, headquartered in Mississippi, took a $10.6 million misstep when its mortgage lending practices allegedly discriminated against African-American consumers. While the bank has not admitted to the allegations, it did agree to a proposed settlement and consent order with the CFPB and the U.S. Department of Justice of charges that the bank’s mortgage lending practices violated the Equal Credit Opportunity Act and the Fair Housing Act.

Fair lending laws and related regulations date back to the civil rights movements of the 1960s, so they’ve been around for a while now. The Fair Housing Act and the Equal Credit Opportunity Act work together to prohibit unfair and discriminatory practices based on traits such as race, color, religion, etc. While some of the allegations against BancorpSouth had to do with redlining, other areas addressed in the complaint against the institution could be levied at credit unions and therefore merit consideration. So what happened at BancorpSouth and what can credit unions learn from its mistakes?