Assistant Attorney General Deval L. Patrick, who resigned effective Monday, made lending bias a front-page issue.
In his two-and-a-half year tenure as head of the Justice Department's civil rights division, Mr. Patrick challenged how banks underwrite and price loans, forcing hundreds of institutions to revamp their operations to root out discrimination.
Through a series of settlements, Mr. Patrick established that banks may not charge blacks, Hispanics, and women higher than normal rates simply because they are willing to pay more.
Lenders also must give whites and minorities equal chances to explain credit problems. Under Mr. Patrick, lenders became responsible for bias violations by independent mortgage brokers.
Though Mr. Patrick, 40, spent most of his time on issues such as defending affirmative action and investigating a rash of black church burnings, deterring lending discrimination is his legacy.
"He couldn't control affirmative action and the church burning were about an investigation of crimes that were slippery and elusive," one industry official said. "The banking cases were a creative use of his resources and an attempt to make a large impact with discreet and focused litigation."
Despite filing seven lending discrimination cases during his tenure, Mr. Patrick will be remembered primarily for challenging Chevy Chase Federal Savings Bank's branching system.
The suit, filed and settled in August 1994 - just a few months after he took office - charged that the suburban Washington thrift violated equal credit laws by not serving minority communities. The settlement required the thrift to open new branches and advertise in minority areas.
The case jolted the industry, prompting bankers to charge the Justice Department with trying to allocate credit and micromanage the business.
"Chevy Chase was the first time the industry realized the Justice Department was going to make serious inroads into this area," an industry official said. "It galvanized the industry."
Mr. Patrick and his staff spent the next six months mending fences - addressing more than a dozen trade groups and establishing regular contacts with industry leaders. Justice did not file another fair- lending case until June 1995.
"Since Chevy Chase, he has been chastened," another industry official said. "After that, the dialogue became more open and more frequent."
Mr. Patrick said he has no regrets about the Chevy Chase case. "The Chevy Chase case was on balance very positive for the fair-lending program," he said in an interview. "It got the attention of the industry.
"What we learned from the conversations that followed the Chevy Chase case was that the industry was not just open to talking about the case but willing to take action."
Those conversations produced tangible benefits for the industry, he said, pointing to the administration's support for a law protecting the confidentiality of fair-lending self-tests.
But industry leaders, who requested anonymity, questioned the value of many of the meetings, noting that they were more a chance for the Justice Department to describe a case rather than to listen to the concerns of bankers.
"He certainly made an effort to reach out and get input," one trade group official said. "But it was after the fact and not in anticipation of a case."
Bankers shouldn't expect the department to back off fair-lending just because Mr. Patrick is leaving. Although the Clinton administration has not yet picked a replacement, the department is expected to bring several cases in the next several months, including one against the big three automakers.
"Fair-lending continues to be one of the administration's highest priorities," Mr. Patrick said. "You are going to see more fair-lending activity in the future. It has contributed to the broad increase in lending to qualified minorities across the country."
But Mr. Patrick said he expects Justice to spend less time prosecuting banks.
Instead, the department will focus on mortgage and finance companies while leaving banks to the regulators. Justice currently is working to ensure examiners are using the department's standards for identifying bias cases, he added.
The department also will move away from home loans, the source of all of its cases to date. The new focus will be on small-business and consumer loans, areas undergoing explosive growth.
Justice also wants to cut the time its spends investigating all cases by contacting lenders early in the probe to see if they want to negotiate a settlement, he said.
"The level of cooperation we have seen from the industry means we can reasonably expect lenders to come to the table," he said.
Although he is leaving the Justice Department, Mr. Patrick is expected to remain active in banking. He's returning to Boston, where his family remained while he worked in Washington.
Mr. Patrick said he expects to join the Boston office of a major law firm. Industry sources said Fleet Financial Group will elect him to its board of directors at the end of January.