A small Texas bank has agreed to pay $700,000 to settle allegations that it discriminated against Hispanic borrowers by charging them higher prices on unsecured consumer loans.
Texas Champion Bank in Alice will make payments to approximately 2,000 borrowers, according to a news release from the U.S. Department of Justice, at an average of $350 per borrower.
The $341 million-asset bank also agreed to monitor its loans for further potential disparities, provide training to its employees, and revise its policies to ensure that prices are set in a non-discriminatory manner, according to the Justice Department.
Many of the Justice Department's recent fair-lending cases have involved mortgage lending, and Assistant Attorney General Thomas Perez said in a statement Tuesday that the Texas case shows that officials are committed to fair-lending enforcement across various credit markets.
"We commend Texas Champion for working cooperatively with the Justice Department in reaching an appropriate resolution of this case," Perez stated.
The Justice Department pursued the case following a 2010 referral by the Federal Deposit Insurance Corp., according to the government's news release.
Officials at Texas Champion Bank did not immediately return a call seeking comment.