A federal judge ruled Lakeland Bank must remain under oversight until 2027, finding it failed to complete key anti-discrimination commitments, including millions in promised mortgage assistance.
WEBDESK – HAJIRA IRFAN – NJNEWSLINE
For years, many families living in Newark’s Black and Hispanic neighborhoods faced limited access to mortgages and banking services, making homeownership far more difficult than it should have been. Now, a federal judge has ruled that the bank accused of those discriminatory practices must remain under court supervision, saying its work to correct past mistakes is far from complete.
Judge Refuses to End Court Supervision
U.S. District Judge Claire C. Cecchi has rejected the Trump administration’s request to end federal oversight of Lakeland Bank, ruling that the lender has not yet fulfilled the commitments it accepted after settling allegations of redlining, the illegal practice of denying mortgages or limiting banking services in minority communities. The five-year consent decree was reached in 2022 after the U.S. Department of Justice accused Lakeland of systematically avoiding Black and Hispanic neighborhoods in and around Newark while offering fewer mortgage opportunities than in predominantly white communities. Friday’s ruling means the agreement will remain in effect until September 2027, as originally ordered.
Key Financial Commitments Still Incomplete
Although Lakeland Bank and federal officials argued that the lender had made substantial progress in complying with the court’s requirements, Judge Cecchi concluded that important obligations remain unfinished
One of the largest outstanding commitments is a $12 million mortgage assistance fund* designed to help eligible borrowers with home purchases, refinancing and home improvements. According to the court, the bank has not yet distributed more than $4 million from that fund.
In her ruling, the judge stressed that good intentions and future plans are not enough to satisfy a court order. She made it clear that promising to complete the work later does not amount to substantial compliance today, especially when major financial commitments remain unmet.
Administration’s Push Faces Another Setback
Lakeland merged with Provident Financial Services in 2024, and company officials said they remain committed to fulfilling every requirement of the original agreement with the U.S. Department of Justice.
The department had sought to end the consent decree after the Trump administration directed federal agencies to review settlements involving discrimination cases. Officials argued that continued court oversight was no longer necessary because the bank had already implemented significant reforms. However, this is not the first time such an effort has failed. A federal judge previously refused to end oversight of ESSA Bank & Trust in a similar redlining case, and the Justice Department did not appeal that decision. That history has led legal observers to believe the latest ruling is also unlikely to be challenged.
Advocates Say Communities Still Need Protection
Civil rights organizations strongly opposed ending the consent decree early, warning that removing federal oversight before every commitment is fulfilled could weaken protections for communities that have historically faced unequal treatment in the housing market.
Dan Urevick-Ackelsberg, a senior attorney with the Public Interest Law Center, argued that Newark residents deserve a lending system free from discrimination and said continued oversight is essential to ensuring lasting reforms. Advocates believe independent monitoring provides accountability and guarantees that promised investments reach the communities they were intended to serve.
The ruling sends a clear message that meaningful reform is measured by results not promises. By keeping the consent decree in place until its conditions are fully met, the court has reinforced that restoring trust after years of discriminatory lending requires more than policy changes. It requires delivering every commitment made to the communities that were denied equal opportunities for far too long.
