Warren Buffett’s Berkshire Hathaway Company has been charged with discriminatory practices by the Department of Justice

The Justice Department said on Wednesday that a Pennsylvania mortgage company owned by billionaire businessman Warren Buffett Berkshire Hathaway discriminated against black and Latino homebuyers in three states.

Authorities said Trident Mortgage, a division of Berkshire’s US Home Services, failed to write mortgages for home buyers in the Black and Latino neighborhoods of Philadelphia, New Jersey and Delaware. As part of a settlement agreement, Trident will set aside $20 million to provide loans in disadvantaged neighborhoods.

“Trident’s illegal re-planning activity has deprived communities of equal color from access to residential mortgages, stripped them of opportunity to build wealth, and reduced property values ​​in their neighborhoods,” said Kristen Clark, assistant attorney general for the Department of Justice’s Civil Rights Division. a permit.

The Justice Department said the activity occurred between 2015 and 2019 — Trident stopped writing mortgages in 2020. Federal prosecutors also alleged that Trident made racist comments about granting loans to black buyers.

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Warren Buffett, Chairman and CEO of Berkshire Hathaway, smiles as he plays bridge after Berkshire Hathaway’s annual shareholder meeting in Omaha, Neb. (AP Photo/Nati Harnik, File/AP Newsroom)

The marketing materials used by Trident included exclusively white individuals, and nearly all of the company’s employees were white.

Trident also agreed to hire mortgage loan officers in affected neighborhoods in addition to paying a $4 million fine. The Justice Department said that because Trident no longer operates a lending business, a separate company will be contracted to provide $20 million in loan subsidies.

The Trident settlement also includes the first redlining case against a non-bank mortgage lender. Since the Great Depression, nearly half of all mortgages in the country have been insured by companies that sell the mortgage on the spot to investors. These non-bank lenders include companies like Quicken Loans, Rocket Mortgage, and Loan Depot, among many others.

“Credit discrimination is illegal regardless of whether the offending company is a conventional bank or a non-bank lender,” said Rohit Chopra, director of the Consumer Financial Protection Bureau.

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The Associated Press contributed to this report.

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