FTC Returns $1.5 Million to Consumers from Mortgage Lender Charged With Illegally Discriminating Against Hispanic Borrowers

FTC Returns $1.5 Million to Consumers from Mortgage Lender Charged With Illegally Discriminating Against Hispanic Borrowers

WASHINGTON, D.C. – April 26, 2011 – (RealEstateRama) — On April 22, 2011, an administrator working for the Federal Trade Commission mailed 3,162 refund checks to borrowers allegedly harmed by Golden Empire Mortgage, Inc. and Howard D. Kootstra. The refund checks stem from a lawsuit the FTC filed against Golden Empire and Kootstra, alleging that they illegally charged Hispanic consumers higher prices for mortgage loans than non-Hispanic white consumers – price disparities that could not be explained by the applicants’ credit characteristics or underwriting risk. A settlement order imposed a $5.5 million judgment that was suspended when the defendants paid $1.5 million for consumer redress. The settlement order bars the defendants from discriminating on the basis of national origin in credit transactions and requires Golden Empire to establish and maintain a policy that restricts loan originators’ pricing discretion, a fair lending monitoring program, a program to ensure the accuracy and completeness of their data, and employee training programs.

Approximately $1.5 million is being returned to consumers. Consumers who receive the checks should cash them on or before June 21, 2011. The FTC never requires consumers to pay money or provide information before redress checks may be cashed. Golden Empire customers with questions should call the redress administrator, Gilardi & Co. LLC, at 888-292-6875 or visit the FTC’s refund website.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 1,800 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s Web site provides free information on a variety of consumer topics. “Like” the FTC on Facebook and “follow” us on Twitter.

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The Federal Trade Commission (FTC) deals with issues that touch the economic life of every American. It is the only federal agency with both consumer protection and competition jurisdiction in broad sectors of the economy.

The FTC pursues vigorous and effective law enforcement; advances consumers’ interests by sharing its expertise with federal and state legislatures and U.S. and international government agencies; develops policy and research tools through hearings, workshops, and conferences; and creates practical and plain-language educational programs for consumers and businesses in a global marketplace with constantly changing technologies.

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