The Justice Department has widened its investigation of Fulton Financial’s mortgage lending practices to include four new units.
The $18.7 billion-asset company disclosed in its quarterly filing that the Justice Department, which had only been looking at Fulton Bank, has expanded its probe to including Fulton Bank of New Jersey, Columbia Bank and Lafayette Ambassador Bank. The four banks conduct business throughout the mid-Atlantic region, with branches located from New Jersey to Virginia.
Fulton, which is based in Lancaster, Pa., said it is cooperating fully with federal authorities, adding that it is unsure how long the investigation will last or how much it might cost to resolve the issue or pay any penalties or fines.
A spokesman for the Justice Department declined to comment. Fulton also declined to comment beyond what it disclosed in the filing.
Since first disclosing the investigation more than a year ago, Fulton has unveiled a program to promote affordable housing, financial literacy and economic development in its markets. The Fulton Forward effort includes a low-down payment mortgage product, grants that can be applied toward closing costs or down payments and a partnership with Operation Hope aimed at improving financial literacy in underserved communities.
Fulton last month tapped William "Smokey" Glover, a Fulton Bank executive, for the newly created position of director of fair and responsible banking. His duties include the day-to-day management of Fulton Forward.
Fulton is among a growing list of banks to receive fair lending scrutiny. In December, First Federal Bank of Kansas City paid $2.8 million to resolve allegations of redlining in minority communities. Two months earlier, Sage Bank in Lowell, Mass., paid $1.2 million to settle similar claims.
