FOR IMMEDIATE RELEASE
 August 19, 2019
Contact:   Caroline Peattie, Fair Housing Advocates of Northern California
(415) 483-7552 / peattie@fairhousingnorcal.org
 
HUD has just released proposed changes to a rule that would make it harder for people to bring discrimination claims under the Fair Housing Act – and easier for businesses to discriminate. The federal register can be viewed here.
 
The Trump administration now seeks to gut one of the Act’s critical tools: the Disparate Impact rule. The Fair Housing Act prohibits both intentional discrimination as well as the application of a policy or practice that appears neutral on its face but has a discriminatory effect. In 2013, the U.S. Department of Housing & Urban Development implemented the Disparate Impact rule that ensured that housing and related services such as lending and insurance are made available in ways that do not adversely impact particular communities protected by the Fair Housing Act. Now, however, the proposed rule change would set a higher bar, requiring civil rights advocates to meet five rather than three requirements in order to succeed with a disparate impact claim. The new rule provides a virtual blueprint for how housing providers can successfully defend against disparate impact claims and even claims that the federal Fair Housing Act (FHA) would not override state laws that regulate the insurance industry.
 
The Fair Housing Act, enacted by Congress in 1968 following the assassination of Dr. Martin Luther King Jr., carried a promise with its passage that every American would have equal access to housing and be free from discrimination. “Many civil rights organizations like Fair Housing Advocates of Northern California have effectively used the Act to help eliminate barriers to housing and promote equal opportunity, and it remains one of the most critical pieces of civil rights legislation for advancing racial and other forms of equality,” said Caroline Peattie, Executive Director of Fair Housing Advocates of Northern California. Despite strides made in the last half-century, however, discrimination in housing persists in the rental, lending, sales, and insurance markets.
 
“FHANC is currently involved in three different lawsuits against lenders that allege disparate impact where the lenders’ practices have adversely affected homeowners in communities of color,” said Peattie. “Making the federal fair housing law less accessible and setting the bar even higher to prove discrimination is sending exactly the wrong message to both consumers and the housing industry alike. It’s telling people in the housing industry – including managers, owners, realtors, lenders, and insurers – ‘go ahead, you can discriminate, as long as you’re careful about it and aren’t obvious about showing intent,’ while telling consumers – renters and buyers who are supposed to be protected under the Fair Housing Act – that it may not be worth filing a complaint because it will be too difficult to prove that what you experienced was illegal discrimination.”
 
In 2015, the Supreme Court reached a landmark decision reaffirming the use and importance of disparate impact in Texas Dept. of Housing & Community Affairs v. Inclusive Communities Project, where Justice Anthony Kennedy wrote the majority opinion, stating that the Fair Housing Act has a “continuing role in moving the Nation toward a more integrated society.” It is used to address structural discrimination leading to inequities, a point underlined by Justice Anthony Kennedy’s statement that: “Explicit, legally sanctioned racial segregation in housing may be over, but its vestiges remain today, intertwined with the country’s economic and social life.”
 
As the most diverse and populous state with almost 40 million residents covering a wide range of communities, California could be the most impacted by changes to this longstanding tool to challenge disparities in housing. California and its residents have a strong history in using disparate impact and fighting to preserve it. As Attorney General of California, Senator Kamala Harris played a key role in the Inclusive Communities case, signing a strong amicus brief filed by Attorneys General around the country that strongly supported disparate impact. California cities also stepped up to support disparate impact. The compelling amicus brief filed by municipalities was led by San Francisco and included Los Angeles and Oakland. Both briefs were cited by Justice Kennedy.
 
California has been the site of significant disparate impact litigation over the years, related to lending, families with children, residency restrictions, and replacement housing. For example:

• The State of California has long relied on disparate impact to challenge occupancy restrictions. In re Accusation of the Dep’t of Fair Employment & Hous. v. Merribrook Apartments, James C. Beard, Owner, FEHC Dec. No. 88-19, (Cal. F.E.H.C. Nov. 9, 1988), the California Department of Fair Employment and Housing concluded that a married couple and their infant child were unlawfully subject to an occupancy restriction that had an adverse disparate impact on prospective renters with children.  
• In Ramirez v. Greenpoint Mortgage Funding, 268 F.R.D. 627 (N.D. Cal. 2010), U.S. Judge Thelton Henderson held that borrowers of color had sufficiently stated a disparate impact claim by alleging that borrowers of color were subject to more discretionary charges that could not be explained by legitimate risk factors.
• In litigation filed in California, the Department of Justice entered into a $335 million settlement with Countrywide involving claims of discriminatory pricing that cost African American and Latino borrowers higher fees and interest rates.  U.S. v. Countrywide Fin. Corp., No. 2-11-CV-10540 (C.D. Cal. 2011).
• The California State Conference of the NAACP and the Community Action League settled claims against the cities of Lancaster and Palmdale for  discriminatory enforcement against African-American housing voucher holders to discourage and exclude them from living in the cities. Cmty. Action League v. City of Palmdale, No. 11-cv-4817 (C.D. Cal. 2012).

 
Banking and insurance trade groups have been exerting pressure to take apart this key protection. Here are some potential outcomes of the elimination of the rule:

• A landlord could exclude qualified applicants without full-time jobs, including seniors and veterans.
• An insurance company could refuse to insure homes under a certain dollar value.  In many communities, this would exclude homes in neighborhoods of color.
• A landlord could evict a tenant if police were called numerous times, even if that tenant was the victim of abuse seeking protection from their abuser, placing women—the primary victims of domestic abuse—and their children at risk of homelessness and further violence.
• Lender or insurance companies could simply show that their computer algorithms are used by the industry in order to defeat claims that their models are discriminatory; merely showing that it is a standard industry practice would act as insulation against claims of discrimination against an individual actor/company. See the Vice article here.

 
Furthermore, language in the proposal indicates that a defendant must simply prove that a practice or policy is profitable in order to withstand a challenge that it has a discriminatory impact, while placing the burden on victims of discrimination to prove that a company can be as profitable without discriminating.
 
Gutting the disparate impact protections under the Fair Housing Act will affect the use of this civil rights tool in other areas, including education, employment, health, environmental justice, transportation, and policing. Following the publication of the proposed rule on the Federal Register, there is a 60-day comment period. Civil rights advocates are concerned that the HUD rule foreshadows a broader application within much of the federal government, as similar efforts are under way in the Education and Justice Departments. Without the use of disparate impact, civil rights groups are far less likely to be able to effectively challenge inequalities related to the nation’s gender wage gap, disproportionate discipline of children of color in schools, over-policing of neighborhoods of color, and the nation’s racial wealth gap.  
 
Government and private discriminatory housing policies such as redlining, lending and insurance policies, advertising, and zoning rules – past and present – have been identified by housing advocates, and analyses by various groups show that they persist around the country today, negatively impacting communities of color, people with disabilities, and ethnic minorities.  Black homeownership is as low as it has been since the 1960s: See article in Urban Wire.
 
"Where you live has everything to do with the opportunities you have available to you,” said Peattie,  "and the Supreme Court's decision underlined that fact by supporting the Fair Housing Act's premise that everyone should have the same chance to live in the housing of their choice, free of discrimination. Now the administration is sending an entirely different message." Peattie maintains that the Trump Administration’s action to gut the disparate impact tool will have a profound, negative effect on the housing choices of millions of Americans of all backgrounds and will undermine equity and equality for decades to come. “Prejudice and bigotry have become more subtle,” said Peattie, “but it’s still there – it’s more difficult to prove, so it’s more important than ever that we strengthen rather than weaken the rule. The Trump administration has made a terrible mistake, and we all need to make our voices heard – both in general, as well as specifically during this comment period, to let them know we won’t stand for civil rights being rolled back.”
_____________________________________________________________________
 
Fair Housing Advocates of Northern California is a non-profit organization serving several Bay Area counties, providing free counseling, enforcement, mediation, and legal or administrative referrals to persons experiencing housing discrimination. FHANC also offers foreclosure prevention counseling, seminars to help housing providers fully understand fair housing law, and education programs for tenants and the community at large. For more information about Fair Housing Advocates of Northern California (FHANC), fair housing laws, and disparate impact, call FHANC at (415) 457-5025 or TDD: (800) 735-2922, email at fhanc@fairhousingnorcal.org, or visit FHANC’s website at www.fairhousingnorcal.org or Facebook page.

For Immediate Release
August 13, 2019
Contact:  Morgan Williams | (202) 898-1661 | mwilliams@nationalfairhousing.org

Late Monday, August 12, 2019, the U.S. District Court for the Northern District of California largely DENIED Fannie Mae’s Motion to Dismiss a fair housing lawsuit concerning housing discrimination against communities of color.  The lawsuit, brought by the National Fair Housing Alliance (NFHA) and 20 local fair housing organizations, charged Fannie Mae with failing to maintain foreclosed properties (also known as Real Estate Owned or “REO” properties) in Black and LatinX neighborhoods, even as Fannie Mae simultaneously was keeping foreclosed properties in predominately White communities well-maintained.  The fair housing groups allege that Fannie Mae’s poor and improper maintenance policies and practices in Black and LatinX communities contributed to blight and other challenges in these areas. 

In a March, 2018 decision, the federal court found that the fair housing groups had standing to bring a lawsuit against Fannie Mae and upheld their disparate impact claims against the mortgage giant.  Disparate impact is a longstanding protection that allows people to challenge unjustified policies that might seem neutral on their face but result in discriminatory outcomes.  In doing so, the court found that the fair housing groups properly brought the lawsuit alleging that Fannie Mae’s REO maintenance practices unnecessarily discriminated against communities of color, regardless of what the company’s intent might have been.

In Monday’s ruling the court again upheld plaintiffs’ allegations of intentional discrimination. But the court also pointed to the fair housing groups’ assertions that even though they repeatedly warned Fannie Mae that its policies and practices were causing discriminatory outcomes, the company did not change its behavior.  The court noted that “…there are sufficient allegations to establish a claim for disparate impact…and the court finds that the Plaintiffs have set out sufficient allegations of intentional conduct.”
“This decision proves that our courts matter when it comes to fighting illegal discrimination,” said Lisa Rice, President & CEO of the National Fair Housing Alliance.  She continued, “Communities of color were the canaries in the coal mine when it came to redlining and predatory lending practices that contributed to the foreclosure and financial crises.  These same communities that were targeted for unsustainable mortgages were the hardest hit.  Fannie Mae’s practices have contributed to the blighted conditions of Black and LatinX neighborhoods and made it harder for these communities, ten years later, to recover from the crisis.”

“We are quite pleased with the court’s ruling which paves the way for the fair housing groups to continue with our lawsuit against Fannie Mae on both disparate impact and intentional discrimination or disparate treatment claims,” said Morgan Williams, General Counsel of the National Fair Housing Alliance.  “For centuries, lending institutions have behaved in ways that discriminate against communities of color.  It’s difficult to get that hard-wired bias out of our lending DNA.  It’s easier to default to practices that manifest discriminatory outcomes.  Our goal with this lawsuit is to get the industry moving in another direction.  We will never see change if we don’t make change.”

The National Fair Housing Alliance and other local fair housing groups have similar lawsuits pending against Deutsche Bank and Bank of America.

The fair housing groups are represented by Relman, Dane and Colfax, one of the nation’s leading civil rights law firms.  The groups are also represented by Morgan Williams, General Counsel of the National Fair Housing Alliance, and Casey Epp, Supervising Attorney of Fair Housing Advocates of Northern California.

Background

On December 5, 2016, the National Fair Housing Alliance along with 20 local fair housing organizations throughout the United States filed a federal lawsuit against Fannie Mae in federal district court in San Francisco, California.  The lawsuit alleged that Fannie Mae failed to maintain its foreclosed properties (REO properties) in Black and LatinX neighborhoods to the same level of quality and standards as it did for foreclosed properties it owned in predominately White communities. 

The plaintiff fair housing groups conducted a comprehensive multi-year investigation of over 2,300 properties owned by Fannie Mae in 38 metropolitan areas (see map below) and accumulated over 49,000 photographs documenting the mistreatment and poor maintenance conditions in communities of color as well as the superior treatment and proper maintenance of REOs in predominately White communities.  The investigation revealed that Fannie Mae failed to perform routine maintenance, marketing and management activities such as mowing the lawn, trimming hedges, removing debris, maintaining gutters, etc.

NFHA notified Fannie Mae many times of the company’s failure to maintain and market its foreclosed homes in communities of color to the same standard to which it was maintaining and marketing foreclosed homes it owned in similar, predominantly White neighborhoods. In spite of numerous meetings between NFHA and Fannie Mae to address these disparities, Fannie Mae persisted in its willful neglect of REO properties it owned in Black and LatinX neighborhoods.

Resources

• Read the press release announcing lawsuit
• Read the complaint
• View the national presentation describing investigative methodology and findings​

Thursday, November 15, 2018
​
FOR IMMEDIATE RELEASE
 
Contact:
Caroline Peattie, Fair Housing Advocates of Northern California
(415) 483-7552, peattie@fairhousingnorcal.org
 
Fair Housing Advocates of Northern California and Client Settle National Origin Discrimination Complaint
 
San Rafael, CA – Late last month, Fair Housing Advocates of Northern California (FHANC) and one of its clients settled a complaint alleging discrimination based upon national origin that had been filed with the Department of Fair Employment and Housing against Continuum Housing Association – San Rafael Redevelopment Agency and its agents.
 
Adan Bernardino Peralta was a prospective tenant who applied for and was subsequently denied the opportunity to rent a two-bedroom apartment at Lone Palm Court Apartments, 840 C Street in San Rafael, California in August 2017. Mr. Peralta’s household was to include his wife and their two minor children (aged 17 and 10 at the time). Mr. Peralta is a naturalized U.S. citizen born in Mexico. His wife, born in Colombia, was a resident in the United States with a valid tourist visa. 

For Immediate Release           
June 26, 2018

Contact:
Contact: Caroline Peattie, Fair Housing Advocates of Northern California
peattie@fairhousingnorcal.org - (415) 483-7552
 
Civil Rights Organizations Accuse Bank of America of Housing Discrimination
 in 37 Metropolitan Areas

Fair Housing Advocates of Northern California, National Fair Housing Alliance, 18 other Fair Housing Organizations, and Two Homeowners Allege Bank of America and Safeguard Properties Management Violated the Federal Fair Housing Act
 
Today, Fair Housing Advocates of Northern California (FHANC), the National Fair Housing Alliance (NFHA), 18 other fair housing organizations, and two homeowners in Maryland filed a federal Fair Housing Act lawsuit against Bank of America, N.A., Bank of America Corp., and Safeguard Properties Management, LLC (“Bank of America/Safeguard”). The lawsuit alleges Defendants intentionally failed to provide routine exterior maintenance and marketing at Bank of America-owned homes in working- and middle-class African-American and Latino neighborhoods in 37 metropolitan areas, while they consistently maintained similar bank-owned homes in comparable white neighborhoods.

Below is an example of a Bank of America property in a neighborhood of color in Vallejo, which demonstrates a number of issues that invite further problems.

The boarded door and window reduce marketability, are unappealing, and make the home dark inside. These boards are also not protecting the windows from breaking since the boards are on the inside of the house.

Bank of America failed to clean up the yard and secure holes, allowing rodents and cats into the home’s crawlspace.

Click here to download the complete press release.

Download the complete complaint below.

​Thursday, April 19, 2018
 
FOR IMMEDIATE RELEASE

Contact:
Caroline Peattie, Executive Director, Fair Housing Advocates of Northern California
(415) 483-7552 / peattie@fairhousingnorcal.org
 
Looking Back 50 Years to Chart the Future: Fair Housing Advocates of Northern California convenes forum highlighting 50th anniversary of Fair Housing Act's passage to inform how past accomplishments can help with future challenges
 
Last week marked the 50th anniversary of the passage of the Fair Housing Act of 1968. This piece of legislation had been filibustered in the Senate by segregationists until the Kerner Commission released its reports that civil unrest was due to the existence of "two societies, one black, one white - separate and unequal." This galvanized the Senate to pass the bill, but the House did not follow suit until after the assassination of Dr. Martin Luther King Jr. and seven days of civil unrest followed.
 
Walter Mondale's New York Times Op-Ed piece was published on the day of the anniversary of the Fair Housing Act and clearly charts the political events that led to the passage of the Act, as well as the intent of the Act. "The act has survived long enough to witness a curious debate over its intent," he writes. "Some scholars have suggested that its functions can be divided into "anti-discrimination" and "integration," with the two goals working at cross purposes. At times, critics suggest the law's integration aims should be sidelined in favor of colorblind enforcement measures that stamp out racial discrimination but do not serve the larger purpose of defeating systemic segregation. To the law's drafters, these ideas were not in conflict. The law was informed by the history of segregation, in which individual discrimination was a manifestation of a wider societal rift."
 
The main purpose of the Act, the co-author of the civil rights bill maintains, was to create integrated communities, and intended to accomplish this in private markets by making housing discrimination illegal in the sale, rental, or advertising of housing, and through the federal bureaucracy, by requiring government agencies to administer their programs in a manner that "affirmatively furthers fair housing."
 
Although many today are surprised to learn this fact, one of the strongest proponents of the Act and of integration was Republican George Romney, Secretary of Housing and Urban Development, who had the following response to one township's contention that progress was being made and forced integration was unnecessary and even resented: "The youth of this nation, the minorities of this nation, the discriminated of this nation are not going to wait for 'nature to take its course.' What is really at issue here is responsibility - moral responsibility." (Charles M. Lamb,Housing Segregation in Suburban America Since 1960, pp. 85-93.)
 
It was not until 2015 that HUD promulgated its Affirmatively Furthering Fair Housing rule laying out very clear guidelines on how federal agencies would be expected to ensure that federal funds would be used to further fair housing. Nevertheless, the concept of furthering fair housing and integrating communities was inherent in the Fair Housing Act, a mandate that grew out of an understanding that this country must counter decades of institutionalized racism and discrimination that led to the segregation we see today, locally and nationally. Richard Rothstein's book, The Color of Law - A Forgotten History of How Our Government Segregated America, acknowledges the collective amnesia that has allowed for continued neighborhood segregation in municipalities and has led to social strife across the country. View Richard Rothstein's talk at a local 2016 conference on this topic, here.
 
Fair Housing Advocates of Northern California celebrates the 50th anniversary of the passage of the Fair Housing Act next Wednesday, April 25, looking at the history of the Act, its successes and shortcomings, and how best to chart a path forward. The event will bring together fair housing and tenant advocates, lenders, real estate agents and developers, housing providers, city and county staff, elected officials, and community members. The conference commemorating the historic event will feature speakers and panelists from Marin, the Bay Area, California, and the east coast to make it a profound event, particularly against the backdrop of the state of civil rights in our country today and the current administration.
 
The two plenary sessions in the morning (titled "California: The Frontline in the War to Integrate America's Cities"and "The Fair Housing Act at 50 - Where do we go from here?" respectively) will lay the foundation for the panels in the afternoon:
 
For Tenants: Tenant Rights and Protections - This session will unpack housing-related bills recently passed as well as what is on the horizon, and how they apply locally; and how various organizing groups can work together to effect change.
 
For Housing Developers, Realtors, Lenders: Sustainable Homeownership Among Low-to-Moderate Income and Minority Borrowers - This session will focus on policies that foster inclusive communities and best practices for transparency and responsible borrowing and lending.
 
Gentrification and Displacement - This panel will address issues of racial equity and land preservation, how policies and institutions limit mobility and equity-building, and other issues.
 
Affirmatively Furthering Fair Housing - Looking at our local history and how policies affecting access to transportation, education, and affordable housing shaped the segregated living patterns we see today, panelists will suggest tools to further fair housing, particularly related to supporting affordable housing, public schools, and transportation policies that will begin to reverse patterns of segregation and lack of access.
 
Strengthening housing advocacy through alliance building - This panel will address how to have difficult conversations about housing in our neighborhoods by debunking myths, stereotypes and misinformation that often lead to fear and exclusion.
 
People interested in more information and registration can visit http://bit.ly/FHANCConference2018. 
 
Fair Housing Advocates of Northern California
is a non-profit organization serving several Bay Area counties that provides free counseling, enforcement, mediation, and legal or administrative referrals to persons experiencing housing discrimination. Fair Housing Advocates of Northern California also offers foreclosure prevention services, pre-purchase education, seminars to help housing providers fully understand fair housing law, and education programs for tenants and the community at large. Fair Housing Advocates of Northern California is a HUD-Certified Housing Counseling Agency. The mission of Fair Housing Advocates of Northern California is to ensure equal housing opportunity and to educate the community on the value of diversity in our neighborhoods. 
 
Please call Fair Housing Advocates of Northern California at (415) 457-5025 or TDD: (800) 735-2922 for more information.

April 6, 2018 
FOR IMMEDIATE RELEASE
 
Contacts:
Adriana Ames / adriana@fairhousingnorcal.org
Caroline Peattie / peattie@fairhousingnorcal.org
 
RE: Upcoming Fair Housing Conference, April 25, 2018
 
Fair Housing Advocates of Northern California is pleased to present the upcoming 2018 Conference: “Past Accomplishments, Future Challenges - Celebrating 50 Years of the Fair Housing Act” to be held on Wednesday, April 25, 2018, 8:30 a.m. - 5:30 p.m. at the Embassy Suites Hotel, 101 McInnis Parkway in San Rafael. 
 
The Fair Housing Conference will commemorate the 50th Anniversary of the passage of the Fair Housing Act, featuring experts in the fair housing field who will address pressing fair housing concerns affecting Marin and the Bay Area, and offer opportunities to engage in strategies to further fair housingin local communities, given present and future challenges at the local, state, and national levels.The conference will gather community members, advocates, real estate professionals, municipal leaders, service providers, and the business community.
 
The featured speakers are James Perry, CEO of the Winston-Salem Urban League, and George Lipsitz, Professor of Black Studies and Sociology, University of California, Santa Barbara.
 
The program includes concurrent panels on tenant rights and protections, sustainable homeownership, gentrification and displacement, and on affirmatively furthering fair housing. The closing panel will focus on strengthening housing advocacy through alliance building.
 
Pre-registration is required to attend. The registration fee is $45 per person and includes a catered lunch. Partial scholarships are available upon request; visit our conference page for more information.
 
To register, visit our conference page at http://www.fairhousingnorcal.org/fair-housing-conference-2018.html
 
For more information or for any special needs, please contact Adriana Ames, Education Director, at adriana@fairhousingnorcal.org.
 
The conference is funded in part bya grant from the U.S. Department of Housing and Urban Development, and the California State Bar, and co-sponsored by: Marin Community Foundation, Wells Fargo Bank, Mechanics Bank, Luther Burbank, First Federal Savings, PRANDI Property Management, TIAA/EverBank, Marin Sanitary Services, Consumer Action and Marin Economic Forum.
-------------------------------------------------------------------------------------------------------------------------
Founded as a non-profit in 1986, Fair Housing Advocates of Northern California, FHANC serves several Bay Area counties, providing counseling, investigation, mediation and legal referrals to persons experiencing housing discrimination. FHANC conducts outreach activities and offers programs that educate the community about fair housing and the value of diversity, and also conducts preventive trainings for housing providers, and provides pre-purchase education and foreclosure prevention counseling.  FHANC is a HUD-Certified Housing Counseling Agency. Please contact FHANC at (415) 457-5025 or TDD: (800) 735-2922 for more information or visit www.fairhousingnorcal.org. 

​Wednesday, February 14, 2018
 
FOR IMMEDIATE RELEASE
Contact:
Caroline Peattie, Executive Director, Fair Housing Advocates of Northern California
(415) 483-7552 / peattie@fairhousingnorcal.org
or
Casey Epp, Supervising Attorney, Fair Housing Advocates of Northern California
casey@fairhousingnorcal.org
 
Fair Housing Advocates of Northern California and Plaintiffs Settle Housing Complaint Alleging National Origin, Familial Status, and Disability Discrimination
 
San Rafael, CA – Last week, Fair Housing Advocates of Northern California (FHANC, formerly Fair Housing of Marin) and two of its clients signed a settlement related to a complaint of discrimination in housing based upon national origin, familial status, and disability, filed with the Department of Housing and Urban Development (HUD) and later transferred to California’s Department of Fair Employment and Housing (DFEH). The complaint was filed against Rosa Nguyen and Bob Torreso, the owner and the property manager, respectively, of 150 Clark Street, San Rafael, where the plaintiffs resided with their minor son. Bob Torreso was the primary agent in contact with the clients regarding their tenancy. The clients were represented by Marcus Levy, FHANC’s Bilingual Housing Counselor, and Casey Epp, FHANC’s Supervising Attorney, who also represented the agency. The case was successfully mediated by DFEH for a total of $27,200 in damages and included fair housing training for three years as well as significant policy changes.

Deutsche Bank-owned home in a white community in Benicia (left) and Brentwood (right).
​
“We initially investigated Deutsche Bank’s properties in 2014 in Solano and Contra Costa counties and found really badly maintained properties in communities of color,” said Caroline Peattie, Executive Director of Fair Housing Advocates of Northern California. “Despite Deutsche Bank being on notice about the problems with their foreclosed properties, they still had not been addressed when we investigated properties in 2016 and found similar issues. Again and again, in neighborhoods that were predominantly Latino or non-white, we found Deutsche Bank properties covered in dead grass, missing professional ‘for sale’ signs marketing the home, littered with garbage, and marred by broken or boarded windows, damaged fences, and the like. Even a highly scored property in a majority non-white neighborhood in Vallejo, built in 2004 and in good shape, was completely unsecured, inviting vandals to waltz through the door. That is unconscionable.”
 
NFHA and the 19 partner agencies collected evidence at each property on over 35 data points that were identified as important to protecting and securing the homes.  Investigators also took and closely reviewed nearly 30,000 photographs of Deutsche Bank-owned homes to document the differences in treatment between communities of color and white neighborhoods.
 
NFHA conducted repeat visits to several Deutsche Bank-owned homes over the course of the investigation.  However, investigators found little or no improvement in maintenance and often found the homes in worse condition.
 
FHANC investigated a total of 22 Deutsche Bank properties in the Vallejo and Richmond metro areas, 5 of which were located in predominantly Latino communities, 13 REOs in a community with a majority of non-White residents and 4 in predominantly White communities. Photos of the properties in the counties of Solano and Contra Costa can be viewed on FHANC’s PowerPoint at here.

• 22.2% of the REO properties in neighborhoods of color had 10 or more maintenance or marketing deficiencies, while none of the REO properties in predominantly White neighborhoods had 10 or more deficiencies.

 

• 50.0% of the REO properties in neighborhoods of color had 50% or more of the property covered in dead grass, while none of the REO properties in predominantly White neighborhoods had the same problem.

 

• 50.0% of the REO properties in neighborhoods of color had broken or boarded windows, while none of the REO properties in predominantly White neighborhoods had the same problem.

 

• 66.7% of the REO properties in neighborhoods of color had a damaged fence, while none of the REO properties in predominantly White neighborhoods had the same problem.

 

• 44.4% of the REO properties in neighborhoods of color had no professional “for sale” sign marketing the home. In contrast, 75% of the REO properties in predominantly White neighborhoods had signs.

 
The poor appearance of Deutsche bank-owned homes in middle- and working-class neighborhoods of color destroys the homes’ curb appeal for prospective homebuyers and invites vandalism because the homes appear to be abandoned. Additionally, the blight created by Deutsche Bank/Ocwen/Altisource results in a decline in home values for African American and Latino families who live next door or nearby, deepening the racial wealth gap and inequality in America.
 
This is not a new problem for Deutsche Bank. In June 2013, Deutsche Bank, as trustee and owner of record of foreclosed homes, settled a lawsuit with the City of Los Angeles for $10 million after it was accused of allowing hundreds of foreclosed properties to fall into slum conditions, leading to the destabilization of whole communities. In the past, Deutsche Bank has taken the position that as a trustee of the loans that resulted in foreclosure, it has no legal obligation to maintain the properties once they come into Deutsche Bank’s possession. And yet, Deutsche Bank agreed to settle the City’s claims and required its preservation maintenance companies to pay most of the $10 million to resolve that case. Under the Fair Housing Act, trustees are clearly liable for discriminatory activity to the same extent as any other owner of property.
 
NFHA alleges that Deutsche Bank, Ocwen, and Altisource’s intentional failure to correct their discriminatory treatment in African American and Latino neighborhoods—the same communities hardest hit by the foreclosure crisis—can only be seen as systemic racism. Smith stated, “The intentional neglect of bank-owned homes in communities of color devalues the property and the lives of the families living in the neighborhoods around them. The health and safety hazards created by these blighted Deutsche Bank-owned homes affect the residents, especially the children, living nearby.” Smith continued, “It is important to note that Deutsche Bank, Ocwen, and Altisource were all paid to secure, maintain, and market these homes.  No one is asking for special treatment of these bank-owned homes; we simply ask that these companies provide the same standard of care for all bank-owned homes, regardless of the racial or ethnic composition of the neighborhood in which they are located.”
 
Stagnant water and overgrown grass, commonly documented at homes where Deutsche Bank is owner of record in African American and Latino neighborhoods through this investigation, are a fertile habitat for mosquitos, rodents, termites, roaches, and other pests. “We found unsecured pools with stagnant water in non-white communities, which is not only a breeding ground for mosquitoes, but also very dangerous for adventurous and curious children,” said Peattie.