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BOA Settles Gender Discrimination Suit

by devteam June 14th, 2012 | Share

Bank of America (BOA) has settledrnaccusations by the Department of Housing and Urban Development (HUD) that onernof its California branches had discriminated against a woman on maternityrnleave.  This is the second settlement ofrnsuch a suit against a mortgage related entity in a month.</p

According to a statement released byrnHUD, BOA has agreed to pay $161,180 to settle allegations that, after offeringrnher a loan and receiving all of the necessary documentation, it refused tornfinance the mortgage loan of an Irvine California woman even though she wasrnreceiving full pay and benefits while on maternity leave.  When the bank did approve her loan two monthsrnlater it was at a rate 25 basis points higher than originally promised. Discriminatingrnagainst a woman who is pregnant or on maternity leave is a violation of thernFair Housing Act’s prohibition against sex and family status discrimination.</p

In May Mortgage Guaranty InsurancernCorporation (MGIC), the nation’s largest provider of private mortgagerninsurance, settled a similar complaint with HUD over its  policy that required women on maternity leavernto return to work before the company would insure their mortgages even whenrnthose women had a guaranteed right to return to work.  MGIC agreed to pay a $38,750 civil penaltyrnand to establish a $511,250 fund to compensate 70 individuals who had beenrnrefused coverage.  </p

“ThernFair Housing Act prohibits lenders from denying home loans to women becausernthey are pregnant or on maternity leave,” said John Trasviña, HUD AssistantrnSecretary for Fair Housing and Equal Opportunity. “Today’s settlement followsrnHUD actions involving other lenders across the country which we will continuernuntil maternity leave discrimination is eliminated.” </p

A Bank of America official said: “Wernregret our treatment of the applicant. We take our Fair Lendingrnresponsibilities very seriously and will work with HUD to ensure our customersrnon maternity leave are treated appropriately during the mortgage applicationrnprocess.”

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About the Author

devteam

Steven A Feinberg (@CPAsteve) of Appletree Business Services LLC, is a PASBA member accountant located in Londonderry, New Hampshire.

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