The Justice Department on Wednesday announced a $13 million settlement with a New Jersey bank that failed to provide loans and other services in predominantly Black and Hispanic communities in the Newark area, the Washington Post reported. As part of the agreement, Lakeland Bank has agreed to create a $12 million loan subsidy fund that will help provide access to credit for borrowers, federal authorities said. The bank will also invest $1 million in outreach, advertising and education and open two new branches in the affected counties. The bank engaged in redlining practices from 2015 to 2021, with none of its 40 branches located in predominantly Black or Hispanic neighborhoods, said Philip Sellinger, U.S. attorney for the District of New Jersey. Other banks generated about five times more mortgages in those neighborhoods than did Lakeland, he said, adding that his office estimated that $120 million in loans would have been distributed by the bank if it had actively sought out borrowers. Assistant Attorney General Kristen Clarke, who oversees the civil rights division, said that the federal case against Lakeland was the fourth major settlement in the past year in a broader Justice Department push to combat redlining across the country. The other settlement agreements, in Houston, Memphis and Philadelphia, netted $25 million in loan subsidy funds.
