Justice Dept. settles with First Lowndes Bank

MONTGOMERY, Ala. (AP) - The Justice Department has reached a settlement with First Lowndes Bank, which was accused of charging its black customers higher mortgage interest rates than white borrowers.

Under the settlement announced Monday, the bank will pay up to $185,000, plus interest, to compensate its black customers who were charged the higher interest rates on mobile home loans.

The bank also agreed to begin procedures to prevent racial discrimination in setting its interest rates and train its employees in those procedures.

The allegations covered loans in 2004 and 2005.

The settlement is subject to approval of the U.S. District Court in Montgomery.

(Copyright 2008 by The Associated Press. All Rights Reserved.)