On Monday, we blogged about the highlights of the panel I moderated, “The CFPB Speaks,” that was part of the Practicing Law Institute’s 22nd annual Consumer Financial Services Institute in Manhattan. The next panel, “Federal Regulators Speak: Priorities & Coordination,” focused on priorities and developments at the Department of Justice (DOJ), the OCC, and the FTC.
Sameena Shina Majeed, Principal Deputy Chief in the DOJ Housing and Civil Enforcement Section of the Civil Rights Division, chronicled the many redlining consent orders/lawsuits filed by DOJ over more than a decade. The most recent was a lawsuit filed on January 13, before Inauguration Day and the confirmation of Jeff Sessions as the new Attorney General, against KleinBank, a Minnesota community bank. I asked Ms. Majeed whether she expected DOJ to continue to pursue redlining cases under Attorney General Sessions.
Mr. Sessions’ nomination to serve as Attorney General met with considerable opposition from Democrats and civil rights groups who expressed concern as to whether Mr. Sessions would aggressively enforce fair housing and other federal laws that prohibit racial and other forms of discrimination. Ms Majeed responded by pointing out that the DOJ’s redlining consent orders/lawsuits spanned both Democratic and Republican administrations. She stated that there were four such cases during President Bush’s term in office. While that may be true, I’m deeply skeptical as to whether Attorney General Sessions will maintain this track record of vigorous enforcement of fair lending laws. One early test will be how DOJ handles the KleinBank case. To the extent DOJ softens its stance on redlining cases, I would expect the CFPB (at least while Richard Cordray remains as Director), state attorneys general, and public advocacy groups to fill that void.