Miami Sues Banks Over Housing Collapse

During the great recession, Miami was hit hard by declining property values. "It was the epicenter of the foreclosure problem," Robert Barnes says in an article for the Washington Post. In an effort to recoup some of the losses (they argue) they suffered at the hands of financial institutions that used predatory and discriminatory lending practices to extract value from Miami communities, "Miami sued Bank of America, Wells Fargo and Citigroup under the 1968 Fair Housing Act, which bars discrimination in the sale, rental and financing of housing," Barnes reports.

This strategy has not previously been attempted. "Banks have been sued by individuals and taken to task by the federal government for lending practices, but these new cases are the first in which cities are the plaintiffs and are demanding that banks be held accountable for harming their communities," Barnes tells us. Bank representatives say opening the door to let communities sue banks would expand liability beyond the intentions of the Fair Housing Act. But city officials are confident that if their case is allowed to go to trial they will win.