WASHINGTON - The Department of Justice has launched an investigation of Barnett Banks Inc. to determine whether its affiliates have illegally discriminated against minorities, sources said.

The department recently sent a letter to officials at the bank, asking them to cooperate in the probe, the sources said.

Officials at both the Justice Department and Barnett declined to comment on the issue.

But sources said Barnett is one of at least a half-dozen lenders across the country to have received letters from the Justice Department about potential problems with lending discrimination.

Florida's Largest Lender

Barnett Banks Inc., based in Jacksonville, Fla., is the state's largest lender, with $37 billion in assets. The company has 33 affiliate banks. The largest bank in the network, Barnett Bank of South Florida, is in Miami.

The Justice Department has signaled its intention to vigorously investigate and prosecute lenders that discriminate against minorities. Until now, only one other lender - Shawmut National - has been widely known to be under investigation by the attorney general's office.

The department is constrained by the high costs of investigations, so it wants to focus on high-profile lenders in big cities, to send the strongest shock waves through the industry.

Miami-based consultant Kenneth H. Thomas has studied minority lending and community reinvestment throughout the country and said Florida - the home state of U.S. Attorney General Janet Reno - is worthy of scrutiny.

Mr. Thomas has met with Justice Department officials to discuss the worst discriminators around the country, including in South Florida. Other cities being scrutinized include Los Angeles, St. Louis, and Chicago, he said.

"By state, Florida is the worst, and by city, Miami is clearly in the top five," he said. "But as the biggest bank down here, Barnett has made a very big effort to improve."

Monday at a closed-door meeting, the Federal Reserve approved three applications from Barnett: to acquire Citizens and People's National Bank of Pensicola, Fla., to merge the acquisition with Barnett Bank of West Florida, and to increase investments in bank premises there.

Justice Department Probes

Last week Associate Attorney General Webster Hubbell told Congress that the Justice Department recently initiated two full-scale and several preliminary investigations independent of the banking agencies. The department has relied extensively on Home Mortgage Disclosure Act data to target the lenders.

The Barnett probe is believed to be one of the Justice Department's preliminary looks.

In addition, the department has considered six referrals from bank regulators about possible minority lending discrimination. Two of those cases have developed into full investigations, Mr. Hubbell said.

Officials at the Office of the Comptroller of the Currency announced last week that they had hammered out a settlement with one of those banks and were awaiting Justice Department review.

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