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Thu May 29, 2014
Providence Sues Santander Bank Over Discriminatory Lending Practices
The City of Providence has filed a federal lawsuit claiming Santander Bank engaged in discriminatory lending practices. Lawyers filing the suit are calling the bank’s lending practices a civil rights issue.
The lawsuit claims that during the housing boom minority neighborhoods were given risky loans, then after the bust Santander stopped making loans in those neighborhoods and focused instead on white neighborhoods.
Attorney John Relman said this is happening in other cities but Providence is the first to take a bank to court. “This is the first case that has looked at the post-subprime era and focused on what now is the new cutting edge issue of we’re starved for credit,” said Relman.
Mayor Angel Taveras said Santander’s loan practices hurts tax collections by depressing property values. “By denying our minority communities good loans, Santander is making it harder for these neighborhoods to recover from the devastating effects of the foreclosure crises that was caused by irresponsible sub-prime lending,” said Taveras.
Santander’s spokeswoman responded with an emailed statement:
“We categorically reject this accusation and will vigorously defend ourselves against the legal action. However, we are willing to work with the City of Providence to allay its concerns. Santander is proud to actively support the communities in which it operates. In Providence, this support comes through our lending, our alliances with three universities in the area, our work with more than a dozen local charities and the more than 800 people we employ there.”
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