As the city of Miami, Florida sees it, a tidal wave of discriminatory and predatory lending from some of the nation’s biggest banks from 2008 and onward caused financial ruination that nearly broke the city. Practices the city alleges discriminated against Hispanic and African-American residents by directing them into risky, high-interest loans resulted in rampant foreclosures that destabilized entire neighborhoods and severely eroded the city’s tax base.
As Miami seeks redress under the 1968 Fair Housing Act, the banks are pulling their own legal forces together to try to get the U.S. Supreme Court to deny the city the right to recoup its losses, arguing that cities shouldn’t be allowed to bring such lawsuits. As the Washington Post reports, “banks have been sued by individuals and taken to task by the federal government for lending practices, but these new cases are the first in which cities are the plaintiffs and are demanding that banks be held accountable for harming their communities.”
“It took us three years to really start recovering,” said Miami Commissioner Francis Suarez. “We decided unanimously as a commission that we wanted to hold the banks responsible for their lending practices, which we learned were discriminatory in nature.” The city seeks justice, but the banks say the law should not be read to allow cities to use it for that justice.
The Post’s article explains the situation in depth, how the lost revenues the city argues were eroded knowingly and illegally by the banks led Miami to the brink of bankruptcy, and how the Supreme Court will be reviewing the case and its issues on November 8th, and thereafter render a decision as to whether and how the lawsuits can move forward. Read the full article on the Washington Post website.