Hein orders money pulled from TD Bank
Move comes in wake of report that alleges racial bias in lending
Ulster County Executive Michael Hein has ordered $10 million in county funds be moved out of TD Bank in response to a report accusing the bank of discriminatory lending practices.
Hein said this week he has directed the money be shifted to the Bank of Greene County, where Ulster County maintains the majority of its accounts.
A report by The Center for Investigative Reporting shows that among banks nationwide that took in more than 10,000 conventional loan applications in 2015 and 2016, TD Bank and Capital One Bank were the most likely to say no to people of color.
Hein, a former banker, said when he acted upon become aware of the report.
“I have ordered the full removal of all accounts until I can get a level of comfort that this type of discrimination is not taking place,” Hein said. “We take very serious the issues of discrimination and red-lining, and we are committed to socially responsible business practices at all times.
“When we are made aware of something of this magnitude, I take action,” Hein said. “I believe the people of Ulster County deserve nothing less.”
Kingston Mayor Steve Noble did not immediately respond to requests for comment, and it was not immediately clear whether the city has any accounts with TD Bank.
Hein said Ulster County moved $50 million from TD Bank to the Bank of Greene County last June after the Greene bank won the right to handle the majority of Ulster County’s accounts.
He said $10 million was left with TD Bank, which has a branch at 411 Washington Ave. in Uptown Kingston.
There also are TD Bank branches in Hyde Park, Poughkeepsie, Wappingers Falls and Hudson.
Nick Altomare, manager of the Kingston branch, referred a reporter’s questions to TD Bank headquarters.
In a statement to The Center for Investigative Reporting, TD Bank spokeswoman Judith Schmidt said the bank “makes credit decisions based on each customer’s credit profile, not on factors such as race and ethnicity.”
Schmidt’s statement said an internal review of the bank’s lending patterns found that, after taking into account creditworthiness, its black and Latino applicants were no more likely to be denied
loans than white applicants.
But The Center for Investigative Reporting said in its report that “AfricanAmerican and Latino borrowers are more likely to get turned down by TD Bank than by any other major mortgage lender.”
“The bank turned down 54 percent of black home buyers and 45 percent of
Latino home buyers, more than three times the industry averages,” the report states.
Jessica Wisneski, deputy director of Citizens Action of New York, said the discriminatory practices of banks are nothing new.
“Home ownership is one of the main ways that people build wealth, yet communities of color have been
routinely denied this privilege,” Wisneski said in a prepared statement. “TD Bank is continuing a legacy of racist lending practices that deepens inequality in our communities . ...
“TD Bank must change its practices, or elected officials and regulators should come down hard on them,” Wisneski said.
State Assemblyman
Kevin Cahill said in an email Wednesday that state law “strictly prohibits discrimination based on race in all manner of business.”
Cahill, D-Kingston, wrote that the banking industry, in particular, “is subject to severe sanctions for violations of civil rights, which is what denying a loan based on race
or any other enumerated classes of people.”
Cahill said there is legislation pending in the Assembly to prevent “backdoor illegal discrimination” and that the chamber is “committed to ending illegal discrimination in all of its pervasive forms.”
There so far is no companion bill in the state Senate, he said.