A group of consumer advocates filed a discrimination complaint Tuesday alleging that Bank of America (BAC) violated fair-housing laws by failing to appropriately maintain and market foreclosed properties in minority neighborhoods.

The National Fair Housing Alliance and five of its member organizations filed an administrative complaint with the Department of Housing and Urban Development. The 78-page complaint alleges "a systemic and particularized practice of engaging in differential treatment," of foreclosed homes based on race, color and national origin.

The group filed similar complaints in April against Wells Fargo (WFC) and U.S. Bancorp (USB) which HUD is still investigating.

Banks and mortgage servicers that have large numbers of foreclosed homes are increasingly facing allegations of systemically failing to clean up and post 'For Sale' signs in minority communities at the same rate that they do in white communities.

"We have found significant racial disparities," said Shanna Smith, chief executive of the National Fair Housing Alliance, during a press conference Tuesday. "They are supposed to maintain properties, make sure the home is secured and address nuisance abatement issues. Routine maintenance is generally done in white communities and in African-American and Hispanic communities it is generally neglected."

The National Fair Housing Alliance evaluated 373 REO properties owned, serviced or managed by B of A in eight cities: Atlanta, Dallas, Dayton, Ohio, Grand Rapids, Mich., Miami, Oakland, Phoenix and Washington, D.C.

The group found that properties in predominantly African-American or Hispanic neighborhoods were more likely to have unsecured doors and broken windows, accumulated mail, trash or overgrown grass; and damaged exteriors, including obstructed gutters or damaged siding.

Jumana Bauwens, a spokeswoman for B of A, denied the allegations, saying the bank stands behind its property maintenance and marketing practices.

"Bank of America is committed to stabilizing and revitalizing communities that have been impacted by the economic downturn, foreclosures and property abandonment," Bauwens said in an email. "We actively address the needs of such communities through existing programs, partnerships with nonprofits and governments and continued investment in innovative programs."

Smith said the group first told B of A about its investigation in 2009 but waited to file complaints to give the bank time to fix the problems. B of A responded in December 2011, according to Smith.

"We've had some discussions although they have obviously been unfruitful," Smith said, adding that additional complaints detailing allegations of discrimination in other cities will be filed against B of A in October and November.

On a conference call Tuesday, fair housing advocates showed photos of dilapidated homes taken earlier this year — one with a dead animal on the property and one with squatters living in the home — and then showed photos of well-maintained foreclosed properties in white neighborhoods.

In two cities, Phoenix and Washington, the group found few foreclosures in white neighborhoods because B of A was quick to fix them up and sell them, Smith said.

Peter Romer-Friedman, the group's attorney and a partner with Cohen Milstein Sellers & Toll PLLC, said the complaint showed "classic forms of discrimination," that have "an enormous and far-reaching impact," by creating blight and driving down property values in minority communities.

"It is illegal to provide borrowers maintenance or repairs based on race, or to limit information that a home is for sale based on race, or to discourage prospective buyers from buying homes, and to promote the sale of properties in white communities and not do the same in communities of color," Romer-Friedman said.

The Department of Justice has filed and settled several lawsuits against banks in the last two years under the "disparate impact" theory, using data to demonstrate a pattern of discrimination that had a disparate impact on residents in those neighborhoods, even though banks claim there was no intent to discriminate.

If HUD does not take action, the fair housing advocates say they plan to file complaints in federal court based on disparate treatment, Smith said.

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