DOJ Seeking More HMDA-Related Data?

A Philadelphia law firm says the Department of Justice has sent letters to "numerous" lenders whose 2004 Home Mortgage Disclosure Act data showed wide disparities between the pricing of subprime loans to minorities and the pricing of such loans to whites.The Justice Department's Civil Rights Division is asking lenders to "voluntarily" provide additional loan-level data, according to Leonard Bernstein, a partner at Reed Smith. The Nov. 22 letters also signal that the DOJ has initiated preliminary investigations for possible violations of the Equal Credit Opportunity Act and the Fair Housing Act. Attorney Andrew Sandler said he is aware of several DOJ letters sent to lenders but that he would be "surprised if there were more than 10." The partner with Skadden Arps also reported that federal banking regulators have been very active, sending requests for additional loan data to more than 10 banks. An analysis of the HMDA data conducted by the Federal Reserve Board flagged 200 lenders for possible fair-lending violations. The Fed shared the secret list with the institutions' primary regulators and the Justice Department.