Miami Gardens sues big banks for predatory mortgage loans
Bank of America, JP Morgan, Wells Fargo and Citigroup accused of violating the Fair Housing Act
Miami Times staff report | 6/26/2014, 9 a.m.
Miami Gardens is suing four of America’s biggest banks, alleging they engaged in a pattern and practice of issuing predatory mortgage loans to minority residents that resulted in foreclosures in violation of the federal Fair Housing Act.
The city filed four separate lawsuits June 13 accusing JP Morgan, Bank of America, Citigroup and Wells Fargo unlawfully imposed different terms or conditions to minority students on a continuous basis since at least 2004.
According to the lawsuits, city leaders want to hold the banks accountable for the “substantial damages the city incurred from their unlawful and discriminatory lending practices.” The city said these damages include a reduction in property taxes collected by the city to the decrease in value of the foreclosed properties and those located nearby.
As of October 2013, Florida has the country’s highest foreclosure rate, and Miami Gardens has the highest foreclosure rate among the 20 largest metropolitan statistical areas in the country, according to the suit.
In addition, Miami Gardens seeks compensation for services and problems associated with foreclosed properties, such as police patrol and property cleanup. While these banks were generating substantial revenue from the issuance of predatory mortgages, Miami Gardens was losing significant revenue and incurring costs that have not been reimbursed, according to the lawsuits.
South Florida’s largest Black city also seeks to prevent these banks from continuing to issue future predatory loans to minorities, hoping to reduce the number of foreclosures that contribute to urban blight.
Miami Gardens joins other cities who have filed similar lawsuits in federal court against the same banks.
Wells Fargo, Bank of America and Citigroup have been denied motions to dismiss their lawsuits by a federal court in Los Angeles.