CFPB Director Rohit Chopra stated, 'The CFPB's lawsuit against Townstone Financial included a major appellate court victory that makes clear that people are protected from illegal redlining even before they submit their application.' This underlines the critical nature of the Bureau's ongoing commitment to various legal actions against discrimination in lending practices.
The proposed order against Townstone would include a $105,000 penalty to the CFPB's victims relief fund, highlighting the bureau's rigorous enforcement of the Equal Credit Opportunity Act and its multifaceted approach to combating discriminatory lending in housing.
The move toward settlement comes after a lengthy court battle that began in 2020, during which the CFPB maintained that Townstone's practices aired in violation of Regulations outlined under the Equal Credit Opportunity Act (ECOA), asserting that their lending policies led to a significant lack of applications from African-American customers.
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