Miami, Florida Sues JPMorgan Chase Bank for Discriminating Against Latino, Black Neighborhoods

Last Friday, the city of Miami filed a lawsuit against JPMorgan Chase & Co. in federal court claiming the company has used discriminatory mortgage lending practices in minority neighborhoods.

The lawsuit claims that the bank, which is the United States' largest, has violated the U.S. Fair Housing Act by giving a disproportionate amount of loans in Latino and black neighborhoods since 2004, according to Associated Press.

Loans given before last decade's housing crisis came with difficult terms and high costs, the lawsuit claims, and the bank would not refinance loans the same way it did to white bankers, Reuters reports. The complaint claims that as a result, minorities have faced much higher rates of default and foreclosure.

"The Miami City Attorney's claims are baseless and stand contrary to our long record of providing affordable housing to low- to moderate-income families across the region," Jason Lobo, JPMorgan Chase and Co. spokesman, said. "The bank will defend itself against the claims."

According to the complaint, however, mortgages given in predominately minority Miami neighborhoods were 4.6 times more likely to end in foreclosure than loans given in the city's predominately white neighborhoods. Miami reportedly had one of the highest foreclosure rates among major U.S. cities during the crisis.

Miami is hoping to get an undisclosed amount of damages as well as an order preventing JPMorgan Chase & Co. from making loan decisions based on race.

JPMorgan Chase & Co. shares are at $56.91 today, down 0.2 percent according to Reuters.

The cities of Miami and Los Angeles have also filed lawsuits against Bank of America Corp., Citigroup Inc., and Wells Fargo & Co., claiming the banks gave minorities mortgages that they could not afford, causing defaults.

Los Angeles recently filed a lawsuit against JPMorgan Chase & Co. as well, seeking damages for "for lost tax revenue and increased city services needed in blighted neighborhoods," as reported by Reuters.
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