The California Reinvestment Coalition has called for a federal investigation into the foreclosure policies of OneWest Bank in minority neighborhoods.
The San Francisco group said that its investigation raised "serious red flags" about mortgage servicing at the $21 billion-asset OneWest. The bank has conducted more than 35,000 foreclosures in California in the last six years. Data compared with U.S. Census data and maps revealed a high concentration of the foreclosures were in "communities of color," the group said.
Among OneWest's total foreclosures in California, 68% were conducted in zip codes where at least half the population is nonwhite.
"OneWest's mortgage servicing has been widely criticized and these data increase our concerns that bad servicing practices may have had an outsized impact on communities of color," Kevin Stein, associate director of the California Reinvestment Coalition, said in a Tuesday press release.
The $21 billion-asset CIT Group has agreed to acquire OneWest for $3.4 billion.