CHICAGO (AP) - A Chicago-area bank that federal prosecutors say illegally avoided doing business in minority areas has agreed to invest nearly $6 million in predominantly black and Hispanic communities to settle a federal discrimination lawsuit, authorities announced Tuesday.
The suit alleged that First American Bank Corp. engaged in a practice called redlining, where loans and other services were denied in black and Hispanic neighborhoods in and around Chicago and Kankakee, Ill.
As part of the settlement, First American Bank must invest $5 million by 2009 in a program to offer residents and small businesses in predominantly minority areas subsidized interest rates. The rates would be at least a half percentage point below what the bank would normally charge - a move U.S. Attorney Patrick Fitzgerald said would result in about $80 million in extra loans in those areas.
The bank did not admit any legal wrongdoing as part of the settlement, said Randall Samborn, a spokesman for Fitzgerald.
http://ap.tbo.com/ap/breaking/MGBRNIMQMWD.html
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