Six years after the housing bubble, the residual effect of the crisis lingers.
The City of Los Angeles sued Citigroup, Wells Fargo, and Bank of America recently in U.S. Federal Court. City Attorney Mike Feuer alleges that banks "engaged in a continuous pattern and practice of mortgage discrimination in Los Angeles since at least 2004 by imposing different terms or conditions on a discriminatory and legally prohibited basis." One citation is a study which estimates the more than 200,000 foreclosures in Los Angeles during the foreclosure crisis resulted in $78 billion in decreased home values, $481 million in lost tax revenue, and $1.2 billion in additional services to maintain vacant and foreclosed properties.
The banks deny the allegations of discriminatory lending.
"These lawsuits send the firm message that we will use every tool at our disposal to fight for all Los Angeles taxpayers and neighborhoods," Feuer said.