New York Principal Courtney Statfeld Tippett recently spoke with American Banker about law suits filed against banks by municipalities concerning predatory lending practices. During a review of recent decisions from both the Supreme Court and the Ninth Circuit Court of Appeals, Ms. Tippett noted that while the rulings may be perceived as making it more difficult for municipalities to prevail in lawsuits in which they allege that banks knowingly pushed high-cost, high-risk loans on minority borrowers, the ruling could also benefit the plaintiffs. Ms. Tippett noted that plaintiffs should view the decisions not as a deterrent, but as guidance for how cities could pursue claims more successfully. She said, for example, that cities would be wise to bring in ex-employees of banks they are suing to help corroborate claims that banks intentionally pushed minorities into higher-cost loans.
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