Majority-Black or majority-non-white neighborhoods were labelled red. The Federal Housing Authority would not insure home mortgage loans in the red neighborhoods, effectively denying loan access to prospective Black homeowners. The legal complaint alleges the bank is guilty of 'redlining,' a term which refers to mortgage loan discrimination perpetuated by the government-sponsored Home Owners' Loan Corporation in the 1930s. The corporation created maps that purported to show the level of risk for mortgage lending in neighborhoods all over the country. The legal complaint accuses the bank of deliberately closing bank branches in majority-Black neighborhoods, making it more difficult for Black home buyers to access mortgage loans. As a community bank, we are committed to fair, responsible and equitable lending practices," said Old National Bank spokesperson Kathy Schoettlin in an email to IndyStar. "That is simply who we are, and it’s one of the reasons we have been recognized for the past decade as one of the world’s most ethical companies." Preventing Black borrowers from accessing mortgage loans could be illegal "Old National strongly and categorically denies the claims made in this lawsuit. Old National Bank officials deny the company engaged in redlining. In addition to this bank, she said her organization's investigations have found there are about a dozen lenders or mortgage brokers who originate a significant amount of loans in the Indianapolis metropolitan area and offer fewer mortgage loans to Black borrowers compared to others. Old National Bank is one of the largest mortgage lenders statewide and the largest bank headquartered in Indiana. Legal scholars say that if the bank's policies disproportionately harmed Black residents, the bank could be liable for illegal discrimination under the Fair Housing Act of 1968.īy the numbers: The most important findings revealed by IndyStar jail deaths investigationĪmy Nelson, the executive director of the Fair Housing Center of Central Indiana, said the Old National Bank case may just be the tip of the iceberg. The complaint filed by the Fair Housing Center of Central Indiana alleges that just 3.86% of the bank's mortgage loans in Marion County went to Black borrowers in 20, even though Black residents comprise nearly 28% of the county's population, according to census data. Watch Video: Redlining of neighborhoods explainedĪ recent legal complaint against Old National Bank that alleges the company discriminated against Black borrowers in mortgage lending has raised questions among redlining experts about whether there is a lack of access to financial services in red-lined neighborhoods and majority-Black neighborhoods in Indianapolis.