The U.S. Department of Justice revealed today the filing of a federal lawsuit against a real estate brokerage doing business as RE/MAX East-West, alleging discrimination on the basis of race and national origin in violation of the Fair Housing Act. RE/MAX East-West is serves Illinois’ DuPage and Cook Counties, including the neighborhoods of Elmhurst, Lombard, Villa Park and Bensenville.

An undercover investigation of RE/MAX East-West conducted by the National Fair Housing Alliance (NFHA) found that the RE/MAX associate’s agents repeatedly steered potential white and Latino homebuyers to areas where their race predominated. According to NFHA, a RE/MAX East-West agent showed a Latino tester three homes in predominantly African-American and Latino areas, homes that were markedly less expensive than those she could afford, and told her that he did not have a lot of time for her. Conversely, the same agent showed a white tester nine homes, the majority of which were in predominantly white areas, and offered to show the tester many more homes in predominantly white neighborhoods as far as a 50 mile drive away.

One real estate agent, John DeJohn, also made illegal comments, NFHA says. He told a white tester, “I don’t care if you are a bigot. If we go to an area and you don’t like it, just let me know. I can’t be a bigot but you can be one.” In addition, DeJohn is said to have informed a white tester that the two homes they viewed together in a predominantly African-American and Latino area were “dumps” and “repos” even though he had told the Latino tester that one of those homes “might be good for you.” And while the white tester received
multiple follow-up calls subsequent to his appointment with the real estate agent, the Latino tester received none.

“That agents of RE/MAX East West were allowed to engage in such blatant discriminatory behavior is outrageous,” says Shanna L. Smith, President and CEO of NFHA. “It is sad to think of how much the community’s residential segregation can be attributed directly to their sales practices.”

The Justice Department’s action comes as a result of a complaint filed by NFHA with the U.S. Department of Housing and Urban Development (HUD). In August, 2005, HUD began an investigation and later found evidence that agents of RE/MAX East-West steered homebuyers based on race and national origin, made discriminatory statements, and treated individuals differently based on their national origin. After HUD issued a charge of discrimination, NFHA filed an election to have the case heard in federal court. As a result, the lawsuit was filed in the U.S. District Court for the Northern District of Illinois, Eastern Division by the Justice Department.

After NFHA filed its HUD complaint in 2005, HUD initiated an investigation based on NFHA’s findings and issued a charge of discrimination on June 9, 2008. The Justice Department then brought suit again RE/MAX East-West and John DeJohn in United States v. S & S GROUP, LTD. d/b/a REMAX EAST-WEST, through its successor in interest, S&W ELMHURST, LLC, also d/b/a REMAX EAST-WEST and JOHN DEJOHN (Case no. 08-CV-4099).

This investigation was part of NFHA’s multi-year, multi-city enforcement project to test for housing discrimination in real estate companies identified by HUD as having previously discriminated during its Housing Discrimination Study.

NFHA’s 12 city investigation found an 87% rate of racial steering and an almost 20% rate of denial for African-Americans and Latinos. The Fair Housing Act prohibits housing discrimination on the basis of race, color, national origin, religion, sex, familial status and disability.