WASHINGTON, Feb 10 (Reuters) – A Texas property developer has agreed to pay $68 million to resolve a Biden-era civil rights case that alleged the company targeted Hispanics in a fraudulent land scheme, and the money will partly fund immigration enforcement by local police, court papers showed Tuesday.

The Justice Department and Consumer Financial Protection Bureau in 2023 accused Texas developer Colony Ridge of marketing unaffordable loans to unsuspecting Hispanic families for the purchase of flood-prone land that did not have utility or sewage lines. After foreclosure, the company allegedly then resold the plots. 

Biden administration officials touted the case as the Justice Department’s first-ever to allege predatory mortgage lending under the Fair Housing Act and Equal Credit Opportunity Act. The company at the time rejected the accusations.

Under the settlement, Colony Ridge will spend $48 million to improve roads, flood prevention and sewage handling, according to the agreement. 

Another $20 million will go to complying with local and federal agreements and funding local law enforcement, “including, primarily, funding additional delegated immigration enforcement authority from the federal government,” according to the agreement.

Harmeet Dhillon, head of the Justice Department’s civil rights division, said in a statement that the deal “will promote public safety, and affordable and sustainable homeownership in America, key priorities of this administration.”

Colony Ridge agreed to a three-year moratorium on direct-to-consumer property developments and to hire an outside expert to oversee its legal compliance, among other conditions.

Representatives of the Texas Attorney General’s Office and Colony Ridge did not immediately respond to requests for comment. The CFPB on Tuesday dismissed all its claims in the case. 

(Reporting by Douglas Gillison in Washington; Editing by Cynthia Osterman)

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