Brad Messer Commentary
Wednesday, December 24, 2003


 

Illegal Discrimination

A midwestern loan company got in trouble over discrimination, but not the kind we'd expect.

The story began in the home mortgage operation of Flagstar Bank. Internal investigators reported that, over time, minority homebuyers may have been charged higher rates than white customers.

They decided on a make-good policy. Without anything being said to customers, minority borrowers would be charged less than whites, to sort of even things out. Commission fees up to 4 percent for whites, but up to only 3 percent for minorities.

After about eight months of that, some white customers found out. They sued.

They just won their case. Flagstar has agreed to pay $1.5 million in a class-action settlement, including the white people's legal fees.

The moral seems to be, don't undercharge anyone whom you suspect may have been overcharged in the past. You can get your pants sued off.

Or as the saying goes, no good deed goes unpunished.

Brad Messer— commentary, KTSA.

 


12/23/2003 findlaw.com
Flagstar to Pay $1.2M for Discrimination

 

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