Fair Lending policy director faces accusations of racism in blog post

Eric Blankenstein, who oversees fair lending enforcement within the Consumer Financial Protection Bureau, used N-word multiple times in the unearthed blog post from 2004

A high-ranking policy director at the Consumer Financial Protection Bureau responsible for overseeing fair lending practices is under fire for a racially charged blog post he co-authored in 2004. Calls for firing the senior Trump appointee have intensified this week.

Eric Blankenstein. (Credit: CFPB)

The screed, which was first discovered by The Washington Post and co-authored by Eric Blankenstein, questions the validity of hate crime reporting, dismissing many as hoaxes, while using multiple racial slurs, including the N-word, to make his point. On Monday, he apologized for the blog, according to The Washington Post.

“Hate-crime hoaxes are about three times as prevalent as actual hate crimes,” the post from 14 years ago reads. “(And I hate that I actually dignified their existence by quoting a statistic that recognizes them).”

Elsewhere on the blog, “Two Guys Chatting,” Blankenstein questioned whether use of the N-word was inherently racist.

“Fine….let’s say they called him n—–,” Blankenstein wrote in a back-and-forth argument over a proposal floated at the time by the University of Virginia, his alma mater, to heighten penalties for acts of racial intolerance. “Would that make them racists, or just a–holes looking for the most convenient way to get under his skin?”

The agency’s Office of Fair Lending and Equal Opportunity was mandated by the creation of the Dodd-Frank Act, which was passed in 2010 in the wake of the financial crisis and resulted in the creation of the Consumer Financial Protection Bureau.

According to a 2017 mandate, the fair lending office is tasked with, “ensuring fair, equitable, and nondiscriminatory access to credit to consumers; coordinating our fair lending efforts with federal and state agencies and regulators; working with private industry, fair lending, civil rights, consumer and community advocates to promote fair lending compliance and education; and annually reporting to Congress on our efforts.”

Those duties include ensuring lenders aren’t intentionally discouraging mortgage applicants in minority neighborhoods from applying for credit and ensuring individuals behind on mortgages aren’t having more difficulty working on a solution with the servicer because of their race, ethnicity or age.

Within the department, Blankenstein is responsible for supervising lenders and enforcing the Equal Credit Opportunity Act, which is aimed at protecting minorities from discrimination through lending for mortgages and other consumer products.

“Do I regret some of the things I wrote when I was 25 . . . Absolutely,” Blankenstein, wrote to colleagues, according to The Washington Post. “The tone and framing of my statements reflected poor judgment.”

A spokesperson for the Consumer Financial Protection Bureau did not respond to a request seeking comment on Blankenstein.

When Mick Mulvaney took the helm of the Consumer Financial Protection Bureau, he announced the enforcement power of the Office of Fair Lending would be greatly stripped back. Mulvaney previously sponsored legislation to disband the agency when he was in Congress.

In the wake of the unearthed blog posts, Patrice Ficklin, director of the agency’s Fair Lending office, has asked Mulvaney to hold off on stripping the department’s enforcement power and halt a shuffle that would hand Blankenstein sole control over race discrimination cases, according to The Hill.

Stripping back enforcement action comes at a time when housing has become increasingly difficult to afford for women and minorities, according to a study by mortgage website FREEandClear. A report from earlier this year determined that homeownership remains as racially divided as it was in 1968. Real estate industry leaders have been vocal in support of fighting housing discrimination.

Following the discovery of the blog posts, housing experts within the agency and outside of it called for Blankenstein’s resignation this week.

In a letter to Mulvaney delivered Monday, National Treasury Employees Union President Anthony Reardon called for zero tolerance and swift and decisive action on behalf of the frontline Consumer Financial Protection Bureau employees his labor union represents.

“The comments Eric Blankenstein has admitted to posting on a blog indicate that he is unfit for any leadership position in the federal government,” he wrote. “The comments run counter to the nation’s civil service principles and are particularly offensive for someone charged with leading the Fair Lending program.”

Reardon echoed comments by Ficklin, who called for the department’s reorganization to be halted.

“Additionally, these statements on the part of CFPB management call into question the current reorganization of the Office of Fair Lending,” Reardon wrote. “That reorganization must be paused and we believe a full review is needed to assess its impact on the office’s mission, especially since any reorganization puts scrutiny over discriminatory practices more directly under Blankenstein’s oversight.”

Fair housing advocacy groups have also joined in calling for Blankenstein’s job.

“The National Fair Housing Alliance is appalled that the CFPB has someone that is clearly unequipped to lead the bureau’s anti-discrimination work or make decisions based on the principles of equality as part of its leadership,” read a statement from the NFHA.

“From Eric Blankenstein’s past usage of the n-word and his denial of the prevalence and seriousness of hate crimes is not only deplorable but frightening. There is absolutely no factual basis for claiming that ‘hate-crime hoaxes are about three times as prevalent as actual hate crimes.'”

Email Patrick Kearns