Two Black former executives sue the Federal Home Loan Bank of San Francisco over racial discrimination
Written by jm on 10/17/2020
by Lisa Davis
Two Black former executives, Lawrence Parks and Timothy Simons, are suing the Federal Home Loan Bank of San Francisco for breach of contract over a racial discrimination settlement, along with a racial discrimination claim. The claim stems from systemic, inequitable treatment of Black people – including Parks and Simons.
A recent study by Redfin listed San Francisco as the number two city in the United States where Black homebuyers were more likely to be denied a home loan. Black San Franciscan loan seekers are more than three times as likely to be denied a mortgage than white homebuyers: The gap is 19.2 percent rejection for Blacks; 5.9 percent for white Americans.
“That is a dangerous statistic, made even more so during a dangerous time,” says Parks. The New York Times reports that overcrowding in the San Francisco Bay Area invites rampant coronavirus infection, with Black and Brown people at the highest risk.
“The Federal Home Loan Bank of San Francisco has not done what’s necessary to ensure adequate low-cost mortgage and economic development credit for Black families in San Francisco to help close the racial wealth gap,” explains Parks. and there is a greater obligation since the bank is a Government Sponsored Enterprise (GSE) and there is a history of distressing economic marginalization of Blacks. The Haas Institute at UC Berkeley recently pointed out in a study that many of the exclusionary housing policies, now common across the United States, originated in the Bay Area.
As one of 11 GSEs charged with advancing housing and community development in areas of need, the Federal Home Loan Bank has not met its mandate to eradicate discrepancies and improve access to capital for Black people. With the removal of Lawrence Parks and Timothy Simons, “there is now no Black representation in the highest level of executive leadership of the San Francisco Bank who can provide daily, needed perspective and actions to close the wealth and credit gap between Black and white America,” notes Simons.
Lawrence Parks and Timothy Simons were highly successful when leading the bank’s legislative and regulatory office. They brought about the development and launch of the Quality Jobs Fund program, which addresses one of the nation’s biggest challenges in creating and enhancing quality employment to support working families. They were instrumental in ensuring the low-cost mortgage credit continued to be a priority supported by Congress. They were honored by Congressional Black Caucus members for their accomplishments and consistently received high marks and ratings from the San Francisco Bank’s CEO.
Parks and Simons are experts in their field. Prior to joining the bank, Parks was Senior Policy Advisor to US Commerce Secretary Ron Brown, where he oversaw the Economic Development Administration and the Minority Business Development Agency of the US government. He also served in esteemed roles such as the associate legislative counsel director at the Mortgage Bankers Association, legislative counsel to Sen. Lloyd Bentsen and as counsel to the US Senate Committee on Banking, Housing and Urban Affairs’ Subcommittee on Housing and Urban Affairs, where he drafted key provisions of the Community Reinvestment Act and the Home Mortgage Disclosure Act – both laws ensure lenders have a legal, verifiable obligation to provide credit to minorities and in lower income areas.
Simons was a member of an elite cable and wireless, PLC Board-established team that transitioned monopolistic business units in the Caribbean and Latin America into successful competitive business units operating in a global environment. He previously worked at KPMG Consulting (BearingPoint) in the Mortgage and Structured Finance group advising major financial institutions in the mortgage industry and was also on the Federal Housing Administration’s audit team. Additionally, Simons worked at two socially responsible venture capital funds, where he led the investment efforts for the establishment of the largest community development financial institution.
Parks’ and Simons’ case against the Bank is currently in depositions, with the trial starting in the coming months.
“In a time where a harsh spotlight is being shined on the rampant – often with violent consequences – social and economic inequities in this nation, the disparities in home ownership and economic development should not be overlooked,” says Simons. Both Parks and Simons intend to continue sounding the alarm, elevating issues and working for equal access to capital and housing for Black San Francisco and beyond.
Source: San Francisco Bay View