Filed Date: Feb. 19, 2013
Closed Date: 2017
Clearinghouse coding complete
On February 19, 2013, the United States of America filed a lawsuit in the Southern District of Texas against Texas Champion Bank, under the Equal Credit Opportunity Act ("ECOA"). The plaintiff, represented by the U.S. Attorney's Office, sought a declaratory judgment, injunctive relief, and compensatory damages to all of the victims of the defendant's discriminatory policies, alleging that the defendant discriminated against Hispanic borrowers because of race and national origin on unsecured consumer loans.
In March 2010, the FDIC performed an investigation to determine whether the defendant was complying with the ECOA. Once it had reason to believe that the defendant had engaged in a pattern or practice of discrimination, the FDIC referred the matter to the Department of Justice. Based on data from 2006 to 2010, the DOJ found that on average, and with all other factors accounted for, the defendant charged higher interest rates on unsecured loans to Hispanic borrowers than to non-Hispanic borrowers. The significant statistical disparity between the interest rates charged to Hispanic borrowers and non-Hispanic borrowers were a result of the broad discretion the defendant gave to its loan officers and negatively impacted Hispanic borrowers.
On March 5, 2013, the District Court (Judge Nelva Gonzales Ramos) entered a consent order between the parties. The defendant did not admit to any pattern or practice of discrimination. The order enjoined the defendant from engaging in any act or practice that discriminates on the basis of race or national origin in any credit transaction in violation of the Equal Credit Opportunity Act. Among other things, the defendant's employees will have to participate in a training program and will be subject to monitoring and reporting requirements. Unique to this case, the defendant has to set up a Complaint Resolution Program for consumers. The defendant also has to place $700,000 into a settlement fund to compensate for monetary damages that aggrieved persons may have suffered.
The consent decree terminated in 2017, and the case is now closed.
Summary Authors
Perry Miska (3/16/2014)
For PACER's information on parties and their attorneys, see: https://www.courtlistener.com/docket/61349827/parties/united-states-v-texas-champion-bank/
Flaxman, Joel (District of Columbia)
Holder, Eric H. Jr. (District of Columbia)
Magidson, Kenneth (Texas)
Montag, Coty R (District of Columbia)
Delionado, John (Florida)
Ramos, Nelva Gonzales (Texas)
See docket on RECAP: https://www.courtlistener.com/docket/61349827/united-states-v-texas-champion-bank/
Last updated March 26, 2024, 3:06 a.m.
State / Territory: Texas
Case Type(s):
Fair Housing/Lending/Insurance
Special Collection(s):
Key Dates
Filing Date: Feb. 19, 2013
Closing Date: 2017
Case Ongoing: No
Plaintiffs
Plaintiff Description:
Plaintiff is the U.S. on behalf of Hispanic borrowers who were charged higher interest rates on unsecured consumer loans compared to the rates charged to similarly situated white borrowers due to their national origin.
Plaintiff Type(s):
U.S. Dept of Justice plaintiff
Attorney Organizations:
U.S. Dept. of Justice Civil Rights Division
Public Interest Lawyer: Yes
Filed Pro Se: No
Class Action Sought: No
Class Action Outcome: Not sought
Defendants
Texas Champion Bank, Private Entity/Person
Defendant Type(s):
Case Details
Causes of Action:
Equal Credit Opportunity Act (ECOA), 15 U.S.C. § 1691
Declaratory Judgment Act, 28 U.S.C. § 2201
Available Documents:
Injunctive (or Injunctive-like) Relief
Outcome
Prevailing Party: Plaintiff
Nature of Relief:
Injunction / Injunctive-like Settlement
Source of Relief:
Form of Settlement:
Court Approved Settlement or Consent Decree
Amount Defendant Pays: $700,000
Order Duration: 2013 - 2017
Content of Injunction:
Develop anti-discrimination policy
Provide antidiscrimination training
Issues
General:
Discrimination-area:
Discrimination-basis:
National origin discrimination
National Origin/Ethnicity: