NYDFS issued an enforcement action against Rhinebeck Bank for alleged fair lending violations. Rhinebeck paid a $950,000 penalty. From the NYDFS findings:
“The Department’s investigation found that Rhinebeck’s practices resulted in minority borrowers paying higher interest rates than non-Hispanic white borrowers for their automobile loans, without regard to their creditworthiness….Although the Department did not find evidence of any intentional discrimination on the part of the Bank or its employees, the Bank’s specific policies and practices allowed automobile dealers to markup a consumer’s interest rate above the Bank’s established Buy Rate,
which resulted in a disparate impact on the basis of race and national origin.”
The consent order may be found here: https://www.dfs.ny.gov/system/files/documents/2022/10/ea20221005_co_rhinebeck.pdf