Lora Fong Chief Diversity, Equity, and Inclusion Officer | New Jersey Department of Law and Public Safety
Lora Fong Chief Diversity, Equity, and Inclusion Officer | New Jersey Department of Law and Public Safety
Attorney General Matthew J. Platkin and the Division on Civil Rights (DCR) have released a report detailing findings from a multi-year investigation into Republic First Bank's alleged unlawful mortgage redlining practices in New Jersey. The investigation, conducted by DCR and the Division of Law (DOL), concluded that Republic First Bank engaged in discriminatory practices against Black, Hispanic, and Asian communities, violating the New Jersey Law Against Discrimination (LAD).
The report highlights that Republic First Bank systematically avoided originating home loans in neighborhoods with majority Black, Hispanic, and Asian populations. This practice of mortgage redlining is prohibited under LAD as it discriminates based on race and national origin.
Despite regulators closing Republic First Bank in April 2024 due to its "unsafe and unsound condition," DCR has filed a claim with the Federal Deposit Insurance Corporation (FDIC), seeking recovery for those affected by the bank's redlining practices.
Attorney General Platkin stated, "It is shameful that Republic engaged in practices that redlined neighborhoods based on the race or national origin of the neighborhood’s residents. Those mortgage redlining practices violate the New Jersey Law Against Discrimination."
Sundeep Iyer, Director of the Division on Civil Rights, emphasized the ongoing issue of redlining: "Our investigation of Republic’s practices unfortunately shows that redlining is not merely a thing of the past."
The report indicates that between 2018 and 2022, only 6 percent of Republic's home loans were made to residents in majority-Black, Asian, or Hispanic neighborhoods. In contrast, peer lenders were more than three times as likely to originate loans in these areas.
The State's investigation revealed several unlawful practices contributing to this disparity. These included failing to address known risks of redlining adequately, concentrating bank branches in predominantly white areas, neglecting advertising efforts in communities of color, and applying underwriting exceptions more frequently for white borrowers.
DCR has also shared its findings with Fulton Bank, which acquired Republic's loan portfolio after its closure. The State has urged Fulton to mitigate any potential redlining risks associated with this acquisition but notes that Fulton has not yet identified additional steps it plans to take.
Deputy Attorneys General Surinder Aggarwal, Mia Dohrmann, and Loren Miller represent DCR in this matter under Assistant Attorney General Mayur Saxena's supervision. The investigation was managed within DCR by Deputy Associate Director Iris Bromberg and Associate Director Malcolm Peyton-Cook.
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