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Post date: September 10 2015

A.G. Schneiderman Secures Agreement With Evans Bank Ending Discriminatory Mortgage Redlining In Buffalo

Evans Bank To Create $825,000 Settlement Fund To Promote Homeownership And Affordable Housing In Buffalo; Stop Using Lending Area Map That Included Most Of Buffalo Metro Area But Excluded African-American Neighborhoods On The City’s East Side

Schneiderman: Discrimination Will Not Be Tolerated; All New Yorkers Must Be Offered Equal Access To Mortgage Opportunities

BUFFALO – Attorney General Eric T. Schneiderman today announced a settlement that requires Evans Bank, N.A. and Evans Bancorp, Inc. (together, “Evans”) to end unlawful discriminatory mortgage practices, known as “redlining.” The practices denied access to mortgage loans to borrowers in predominantly African-American neighborhoods in the city of Buffalo because of the racial composition of those communities. The settlement agreement  requires that Evans revise its lending area to include the East Side neighborhoods and other areas previously excluded from the bank’s lending area. It also requires Evans to establish an $825,000 settlement fund designed to promote homeownership and affordable housing in Buffalo and to encourage lending activity in the East Side and other previously excluded areas.

“It is essential that all New Yorkers, regardless of the color of their skin or the racial make up of their neighborhoods, be afforded equal access to our banking systems – and the basic benefits of obtaining a mortgage," Attorney General Schneiderman said. “That we continue to see systematic racial and housing discrimination in New York in 2015 is shocking. I will not stand for it. We will fight for equal justice under law for all New Yorkers, and hold lenders to their legal duty to treat all our citizens fairly in the marketplace. That fight includes holding big banks accountable for the housing collapse of 2008, one that hit minority communities the hardest -- and all banks to their bottom-line legal duty not to discriminate.”

The settlement concludes a year-long litigation, commenced by the Attorney General against Evans in the U.S. District Court for the Western District of New York, alleging that Evans had systematically denied its mortgages and services to African-Americans in the Buffalo metro area. The lawsuit alleged that, from at least 2009 to the present, Evans had “redlined” Buffalo’s predominantly African-American East Side neighborhoods, intentionally excluding these neighborhoods from its lending area; developed mortgage products that it made unavailable to these neighborhoods, notwithstanding the creditworthiness of the applicants; and refused to solicit customers, market mortgages, or provide banking facilities in those neighborhoods. The lawsuit alleged violations of the Fair Housing Act, 42 U.S.C. § 3601 et seq., the New York State Human Rights Law, N.Y. Exec. L. § 290 et seq., and Chapter 154 of the Code of the City of Buffalo, § 154-1 et seq.

Evans is a federally-chartered bank headquartered in Hamburg, New York. The bank has 14 branch offices located primarily in the greater Buffalo area. According to U.S. Census data, Buffalo is home to over 260,000 people, including over 100,000 African-American residents. Buffalo is also one of the 10 most highly segregated large metro areas in the nation, with African-American residents being concentrated on the East Side of the city, in neighborhoods east of Main Street, and the surrounding parts of the city and suburbs being predominantly white.

The lawsuit alleged that, by “redlining” the East Side neighborhoods, which are home to more than 85,000 people, Evans excluded an area that is home to the vast majority of Buffalo’s African-American population from the marketing and sales of its mortgage products and services. The lawsuit alleged that Evans created a map defining its lending area that included most of the City of Buffalo and its surroundings, but excluded the predominantly African-American neighborhoods on Buffalo’s East Side. Evans called the included areas on its map its Trade Area. By excluding certain neighborhoods from its Trade Area, Evans automatically disqualified East Side residents—regardless of their creditworthiness—from obtaining certain mortgage products and excluded the East Side from its marketing efforts.

The settlement agreement requires that Evans, which, after the filing of the Attorney General’s lawsuit, expanded its Trade Area to include all of Erie and Niagara counties, maintain its expanded Trade Area, including the East Side neighborhoods and all other previously excluded areas in the greater Buffalo area. Click to see maps depicting the bank’s former Trade Area redlining the East Side of Buffalo and the expanded Trade Area.

As part of the settlement agreement, Evans will be required to direct $475,000 to the creation of the Housing Opportunity Fund, which will fund City programs that encourage homeownership as well as development and restoration of affordable housing in Buffalo.

The agreement additionally requires Evans to invest $200,000 in advertising and marketing designed to reach potential applicants and residents of the East Side and other areas previously excluded from the bank's Trade Area. The agreement requires Evans to invest $100,000 in grants, fee waivers, and other subsidies as part of a Special Financing Program designed to increase lending activity on the East Side and in other previously excluded areas. Evans will also pay $50,000 to the State of New York in costs and fees.

The settlement requires Evans to revise its loan policy to eliminate any minimum mortgage amount, to provide fair lending training to employees and agents with significant involvement in mortgage lending, and to report information to the Attorney General to ensure compliance.

This action is part of an ongoing, wider investigation by Attorney General Schneiderman’s Civil Rights Bureau into mortgage “redlining” by banks operating in New York, and it was prompted by concerns that banks had stopped lending to minority communities in the wake of the mortgage crisis and financial collapse of 2008. Historically, banks have engaged in “redlining” in racially segregated areas, and according to U.S. Census Data, New York is one of the most highly segregated states in the nation, with several highly segregated large metro areas, including Buffalo and Rochester, among others. In January 2015, the Attorney General secured a settlement with Five Star Bank ending similar discriminatory lending practices in Rochester.

Marc Morial, president and CEO of the National Urban League, said, "The future health of our economy requires that banks provide all communities with equal access to their lending services.  By not providing minority consumers access to loans, banks run the risk of impairing economic recovery across all communities.  I thank the Attorney General's Civil Rights Bureau for working to combat ongoing redlining of minority communities."

This matter is being handled by Assistant Attorney General Mayur Saxena, and Special Counsel Jessica Attie of the Civil Rights Bureau, and Civil Rights Bureau Chief Kristen Clarke, with assistance from Michael J. Russo, Assistant Attorney General In-Charge of the Buffalo Regional Office. The Civil Rights Bureau is part of the Attorney General’s Social Justice Division. The Executive Deputy Attorney General for Social Justice is Alvin Bragg.

The Civil Rights Bureau of the Attorney General’s Office is committed to protecting all New Yorkers from unlawful discrimination. To file a civil rights complaint, contact the Attorney General’s Office at (212) 416-8250, or visit

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