Video: Emily Flitter And Dedrick Asante-Muhammad Discuss Banking’s Historic Role In Reinforcing Inequality — And How To Change It

NCRC Just Economy Conference 2023 —  Recorded March 29, 2023

Flitter and Asante-Muhammad discuss inequality, its impact, and solutions at the Just Economy Conference. Urgent need for equity and justice is highlighted.

Speakers: Emily Flitter And Dedrick Asante-Muhammad


NCRC video transcripts are produced by a third-party transcription service and may contain errors. They are lightly edited for style and clarity.


EMILY FLITTER: Good afternoon, everyone. It’s great to see you all. And I am honored to be here at the NCRC 2023 Just Economy Conference. We’ve heard from so many people over the past few days who are working to improve the experiences of individuals and the conditions of communities in this country who have been abused and neglected by white people in power. In many ways, the discussions at this year’s conference have included front and center acknowledgement that this abuse continues today. We have been talking about how African American and other minority business owners still struggle to get bank loans. While venture capitalists pour money into mostly white on startups, most of which are doomed for failure.

We have heard about the myriad obstacles to building more affordable housing, and the ongoing discrimination against black Americans in the home appraisal market. But excuse me, I’m here to emphasize how the force of racism operates on all levels of the financial system today. Here’s an example. I’m going to read you a few emails that bank tellers at Chase bank branches in the Northeast recently sent to each other warning of suspicious customers. These are from a cache of dozens of such messages that I obtained as part of my reporting for my book, The White Wall. As you listen, see if you can identify anything that each of the people described in the messages was actually doing to warrant being viewed with suspicion. And please, no, I’m not quoting selectively, I’m reading these emails in their entirety.

The first one says, African American man tried to cash a check from a business in Texas. The next one says, very young African American male with blonde dreads came in and presented this check for caching. I told him I had to verify the check. And he got very upset and confrontational. I called the maker and they said they did issue the check. He took it with him. Another one, an account was open for a tall African American male with dreadlocks and facial hair. After fraud was called the account was restricted, attached his copy of payroll check. Let me add that I sifted through about 50 of these emails. And there were plenty that did not include any descriptions of race, and did include descriptions of explicitly bad behavior, like someone trying to use a bank card that had already been reported stolen.

Furthermore, most of these emails, including two of the three I just shared had attachments of scanned identification cards, which made it unnecessary for their authors to include descriptions of race. Yet for black customers, those descriptions were included anyway, while for white customers, they were not. This is racial profiling. It happens all the time. If we want to actually reach a place of equality, this has to stop. No amount of philanthropy or glassy language or promises of partnership will fix this. In spite of all the work and energy being poured into the problem of the racial wealth gap. My experience is exploring this staggeringly huge problem has shown me that we and when I say we, I mean the people with power in institutions that form the architecture of white supremacy, have barely begun to address this problem.

This is a problem that is all around us all the time. And for too many of us it is its features remain unrecognizable. How many of you were here yesterday with Jelani when Jelani Cobb was talking with Karen Attiah about his mission as the new dean of Columbia Journalism School. Awesome. Jelani spoke of the problem in contemporary American journalism whereby journalists exhort each other to remain objective, and to tell all sides of a story. He spoke of the folly that would be so obvious to everybody if that imperative were taken to its extreme. In a story about vaccines. For instance, a reporter would have to include the voice of the guy who thinks vaccines as Jelani, put it magnetize you, they literally turn you into Magneto from the X Men.

I’m a reporter operating under the requirement to remain objective. And that, of course, is not what I would do. I don’t go looking for the lunatic angle as a prerequisite for filing a story. But here’s what I am trained to do. And what I realized after reporting and writing The White Wall is part of the problem that I am laying out to you. It is a lot subtler than giving space to an anti Vaxxer, or an election denier. When someone comes to me claiming to be abused or mistreated, I have to first decide whether telling their story is worth it. Whether it represents a larger problem that can potentially be addressed, if it is shared with readers. I have to make that judgment. Before I spend any more time with this person, then I have to start looking at taking that story apart and looking at its individual components. Are they sound? How might they appear from a different angle? Is what I’m hearing a deep and absolute truth? Or could it be a misunderstanding? How big a deal is it?

What am I missing about this picture? This kind of analysis is the basis for all good journalism. It’s necessary. But in the same process, I as the journalist may apply unwittingly a bias that skews the final product just slightly. Before I started writing The White Wall, my process for analyzing the stories that were brought to me by victims of racism suffered from a bias that I did not know I had, here’s what I was doing. I was looking at each story individually and trying to sort out the he said she said components to figure out whether it was in the end a big deal. And I heard so many stories that were taken in isolation, just not. They might have been explained away easily as having some force other than racism at their root.

Now, let me tell you a story that I heard after my book came out. This is a personal experience, shared with me by a woman, whom I was extremely fortunate to meet, because she interviewed me about the book for an event in Cleveland. Her name is Danielle Sydnor. She is now the CEO of the economic development organization rise together Innovation Center in Columbus, Ohio. And when we met, she was the outgoing president of the Cleveland chapter of the NAACP. She’s a black woman. And let me say that I feel comfortable sharing her story with you because she shared it herself with our audience in Cleveland. It’s an incredible story. It took my breath away. Because Danielle did the same thing that I just described doing. And in this case, she was the subject of the racist abuse.

Danielle spent years in the financial industry, she worked at banks, and she worked as a financial advisor at several large firms. She was a Bank of America Merrill Lynch, while there was an ongoing class action suit brought by black financial advisors over racial discrimination that covered a wide range of practices, from relegating black financial advisors to offices in poor neighborhoods, to denying them access to retiring advisors books of business, to using vague and measurable standards to claim that they were failing, and to dissuade them from seeking to advance. While Danielle was there, she was young, and she was full of hope. She knew that she was a member of the class, by definition, because she was black, but she felt like it had almost nothing to do with her. And really, she wanted nothing to do with it. Then she left bank of America and went to MetLife. And there she started having problems. And one day, she got a call from the lawyer who handled the Bank of America case, Linda Friedman, who said, Danielle, I want you to be a lead plaintiff in a discrimination class action against MetLife. And Danielle said no.

She said, I don’t think what’s happening to me is happening because of the color of my skin. I think I just have a bad boss. Somebody can’t get along with. And if I just try harder. And if I can manage to get moved to a different spot and work for somebody else. I think I’ll be all right. I know I can do this. And Linda, who had been doing this kind of work for decades already by then said okay, Danielle, since you’re not feeling great about your situation, can you at least just tell me what’s going on? Just what problems are you having with your boss? Describe them for me. And Danielle said okay, I can do that. And she started laying out her experiences. And Linda started finishing her sentences.

Doesn’t that story just send a chill up your spine. In my opinion, it is a great illustration of the thing that surrounds all of us that we so often can’t see. The fact that what we take his neutrality as part of the structure of white supremacy. Even while she was going through a terrible experience rooted in racism, Danielle searched for other explanations for the distress she was in It was only when Linda by finishing her sentences revealed to her that there was a larger context for her experience, that she was not alone. And that what was happening to her was not an isolated incident but a broad recurrent phenomenon.

To fix the racial wealth gap, we have to tear down this structure. To begin that process, we have to know where to swing the sledgehammer. Those emails I read, that seeming that treatment has got to go, and so does the seemingly endless shunting of black employees in the wealth management business into places with suboptimal opportunities away from the main gravy train, despite the many racial discrimination class action cases that have been settled for 10s of millions of dollars. And so do the many other racist practices still in force in the financial industry today? I tried to describe some of them in my book, I didn’t even cover them all. There’s been so much great work on how racist home appraisals are.

And I barely touched on that. One thing that I did write about that I think really needs so much more attention is the racist treatment of black insurance policyholders. It’s not just about redlining in the sales of policies. It’s about how policyholders are treated when they try to make a claim. I think Diedrich and I are going to get into the insurance issue a little bit more in our discussion, I was really heartened to hear the ways that people here today are trying to change the system.

I attended yesterday’s presentation on the African American equity impact scorecard, for instance, which CDFI panelist said had already helped them find ways to make loans and investments in businesses that would not qualify for bank loans. But this can’t remain inside a niche and finance, it has to spread through the throughout the entire industry. What we see as neutrality isn’t neutrality, it’s white supremacy. I know, you’ve all heard that before. But I also know it bears repeating. I don’t want to take up too much time. But I can’t leave the stage without sharing with you, where my own reporting led me on this to reparations. We need a national reparations program and the financial industry should get behind it, and lobby the federal government to implement it.


DEDRICK ASANTE-MUHAMMAD: Only by closely examining the roots of the inequality that we operate in today, can we find the language to address it? Truth and Reconciliation, as it relates to slavery is the beginning. It’s how we all get on the same page. And from there, we must advance through history today, acknowledging every injustice along the way, and understanding how they have led to our present condition. Thank you.


All right, well, thank you so much for giving us a kind of an overview of, of the, of the book here I have here, The White Wall: How Big Finance Bankrupts Black America thought it was a great title and a great read, I really do like, throughout the book, how you kind of highlight individual examples of the structural inequality that you’re that you highlight. And I really do appreciate to even the framing of white supremacy, using that language, because I think you also highlight that banks, and, and many will start talking about, well, here are all the programs we’re going to do, but they never really acknowledge that what has been created is white supremacy. And the fact that they have to do diversity in their organizations means it has been a space of kind of white of white supremacy that reinforces itself. And I think your book, you know, really did a good job of on the individual level.


And in that type of diversity work, what that looks like and how people are pushed out. I wanted to talk a little bit about the section on insurance, because I think that’s another important aspect is you highlight all these different sectors of the financial industry. And your section on finance. You write today, virtually every one who could use data to study in detail, whether insurers are treating their customers equally is bar is barred by law or circumstances from doing so. And I’m looking at our director of research. Jason, I thought this is real interesting is, you know, where are we today with this situation around insurance? And is it still almost kind of impossible to get the data to even understand and and really bring up the problems of racism in the insurance industry and its effects on the people.


FLITTER: So this is an area that for researchers is almost completely untapped in the last 20 years, and that’s because insurers are regulated by 50 different states and they have managed to bar the states from collecting and releasing publicly data On the outcomes of their claims, insurance is a very simple business. You sell policies, you get premiums. And then on the other side of the ledger are the claims payouts, which insurers actually refer to as losses. So I think everybody knows, insurers don’t want to pay claims, and they find ways to not pay them. The problem is, they find ways, much more often to not pay black claimants. This is based on anecdotes that I collected from black claimants who faced all kinds of hurdles trying to get their claims paid out. But also, and this is actually really exciting. I wrote a story about this in December of 2020. And unbeknownst to me, some researchers and lawyers connected with the NYU center on race inequality, and the law actually designed and implemented a two year study where they followed claims outcomes across a huge section of the Midwest. And they found a statistically significant difference between how black homeowners insurance claimants were treated, versus how white claimants were treated. They could only do that by surveying people, they couldn’t go to an insurance regulator and get the data because as I explained in my book, insurers have done all kinds of things to suppress the data. They say generally, that it’s company secret, it’s like the recipe for Coke or something, and they can’t divulge it. It’s a trade secret. Actually. The Wall Street Journal reported and this is also in my book that they share the data amongst each other, but it’s just private. So it’s, it’s just an untapped area that I think is is just such a huge problem. There’s now a class action lawsuit against state farm that the lawyers connected with this NYU study have filed but there’s a lot more to be done on that,


ASANTE-MUHAMMAD: Ya know, and, you know, it reminds me too, of how oftentimes, the problem is put on well, you know, black people, Latino people aren’t using insurance enough. They’re underinsured, and like, what can we do to help them become more insured? Or there are underbanked? And what can we do, but your book kind of highlights that at the same time, there’s these discriminatory practices, which are keeping people from wanting to be attached to these systems, while at the same time, but when we talk about the issue, we talked about the underinsured or the unbanked as if the problem is the actual communities not wanting to versus them being treated in a prejudicial way to push them out of these services.


FLITTER: Totally, it’s a lot of victim blaming.


ASANTE- MUHAMMAD: So let me also bring up a quote from your book, we were talking about credit scores. And you know, I think this says a lot in the framing of kind of racial wealth inequality, we say, the information contained in a borrower’s basic profile has been skewered has been skewed by injustice, and just wondering if you could expand upon the meaning of that what you were getting at there?


FLITTER: Well, every sort of, part of interacting with the financial industry, if you’re black, is, is more difficult. And so if you’re going into a situation where a bank’s gonna judge you on how your, what your history is of paying bills, and then nobody’s been giving you the opportunity to pay bills, and you live in a neighborhood that’s, you know, been marked by these giant financial institutions as being at a disadvantage and, you know, a high risk area, I mean, all these like, buzzwords that mean, discriminatory things. You’re, you’re just starting out from behind and, and then you add in the wealth extraction, which I know has come up a lot over this conference, you know, that took place in 2008. With predatory collusion, yeah. And, and I was, you know, I’ve talked to people who, whose parents had mortgages that that a banker convinced them that they should have that were exploding. David Dunn, lost everything. And their credit was ruined, and they weren’t, you know, the guys who, I can’t remember that CNBC guy’s name, who lost it on TV and talked about too many bathrooms. These were people who had a house that they were living in, that was their home, and they were punished for having a mortgage and that sticks with you and your credit score.


ASANTE-MUHAMMAD: Yeah, no, I do. I do remember what was it? I forget which publication but when they were covering the Great Recession they had pictures of like, African American Latinos and all of these homes as if that was the problem in itself instead of the problem is the lack of African American and Latino homeowner, homeownership, right with both under 50%. Well, white Americans is over 70%. But again, this kind of blaming the victim, and again, appreciate it that quote, the information contained, the bar spacing profile has been skewed by injustice, just the idea that the very, you know, credit score, you’re punished for the racial wealth divide, which was inflicted upon you, right, like that’s, that is what your credit score is showing, because you don’t have strong credit with very low wealth. That’s very irregular. So one, another section you had in your book, he talked about financial advisors, and, and it’s kind of it was a critique, I found he was an antique of the industry as a whole. And just let me know if my takeaway is correct. And what you have to add for that, but seems to be really highlighting that the financial industry likes to put forth this idea that they’re helping households become financially secure. But in fact, it’s really trying to capture a part of the wealth of the wealthiest Americans, oftentimes at the expense of financial advisors, if you could speak a little bit about how it comes at the expense of financial advisors, and what that has to do with kind of racial wealth inequality.


FLITTER: So this was an example that this is a chapter in my book that’s specifically about Edward Jones. And they had a program where they were recruiting people who weren’t necessarily just coming out of college, they were kind of mid career to become financial advisors for Edward Jones. And they would have to go through a three year training program. And they wouldn’t be paid while they were studying for all of their exams. And then the, the, the income that they were getting from Edward Jones would taper off, and they were supposed to replace it with their own commissions. And the problem was that the black financial advisors who were being recruited into this program, were kept away from all of the opportunities to earn commissions, they weren’t being handed books of business, the way white recruits were, they were being told they had to work in neighborhoods that just didn’t have the wealth that they could use to build up books and businesses. And in the meantime, as the income tapered off, they were being assigned to offices where they would have to contribute to the overhead expenses. So they were literally subsidizing Edward Jones’s storefronts.

And there was there were actually two class action suits about this. One was for racial discrimination, and one was for this specific practice of like, literally just extracting the wealth from the people who, again, like the people I talked to, for this chapter, they didn’t even need these jobs at Edward Jones, they were lured away from other things that they were doing, by people who were already working there, who were who were saying, like, it’s so great, and you can work wherever you want, and it’s just so awesome. And and then they were just being like, bled. And it’s the, the finance the financial advisory industry. You know, I don’t know why there have been so many. Or I guess, like, I know why. But it’s hard to believe that there have been so many of these class action settlements for racial discrimination. And some of them like Morgan Stanley’s included a monitor that required them to make changes that the monitor had to sign off on. And then as soon as the monitorship ended, it just went back to the way it was, I just, it’s just kind of mind boggling that it doesn’t get any better.


ASANTE-MUHAMMAD: And what I appreciated appreciate about your book is I think there are these cases that come up, and we’ll focus that oh, this, this industry is, you know, very racist, are we hearing a lot about appraisals, and that, oh, that’s not an integrated space. But your book by putting it all together kind of highlights it just a factor throughout set the section of section section after section of the finance industry, and we kind of addressed it as like a piecemeal issue versus this is a holistic problem of the of the, you know, overall finance industry that really needs to be addressed as part of because I think, too, there’s a kind of oftentimes a distinction between dealing with the racial wealth divide, which financial institutions will talk about programs they’re doing, as almost a separate thing from the kind of diversity and inclusion that might be occurring or might not be occurring.

But let me ask, I mean, we have heard that’s one thing I have appreciated over the last few years is there’s much more conversation. I remember, when I first was engaging with financial institutions around the racial wealth divide. They thought it was a radical thing. He even used that term, right. And I was really excited just to be able to write a report that a financial institution would acknowledge that this thing existed. But now, all financial institutions seem to have some racial wealth divide initiative programs, what have you, what’s your assessment of the impact? And, you know, has a change? Are we really on a path toward change? Or is this kind of more programs but little results?


FLITTER: Well, I think that it’s, it sort of speaks for itself that this is such a moving target. Like if we were going to really, if we’re gonna really have change, I mean, why can’t we just get on with it? Instead of instead of like, constantly having to, you know, have these big institutions act like all surprised, oh, my god, I just walked over here and saw this racial wealth gap. It’s like, yeah, yeah. Like,


ASANTE-MUHAMMAD: During the conversation with Treasury this morning, it was interesting that they were saying, this was the first Oh, I think last year was the first year where they’ve had a focus on racial economic inequality. And I was like, like, it’s 2023 2022. You’re in charge of the economy. And this is the first year that we’re dealing with issues of Russia. I mean, and so that’s government. But I think it’s also you’re seeing seeing that in the private sector.


FLITTER: Yeah. I mean, the private sector is not any more eager to acknowledge this stuff than the government is. And I think one of the big problems is, the private sector has this just relentless desire to say how great they are. And you cannot fix this problem. If you’re just constantly talking about how great you are, you’re, you’re not like, and I thought so. So and I’m not trying to like, I don’t want anybody who works for big banks out there to think that I’m never going to acknowledge something that they’re doing right. So let me give you an example. There have been these groups, shareholder groups, trying to get banks to do racial equity audits, and the banks then preempt them and say, don’t make our shareholders vote on this resolution and bind. Well, they’re non binding, but whenever everybody gets so worked up about them, that they preempt them, and then they say, We’re gonna do a racial equity audit, and it’s gonna be awesome. So like, Citi and JP Morgan, both did them and cities was actually robust. And they actually acknowledged that they had made, they had, they could do more than what they did in their 2020 racial equity pledge, JP Morgan. And I wish I had written it down, had like a very, very short racial equity audit release, that basically said, like, we are doing so great that this audit was just like, telling us how great we are. And it’s like, no, and, you know, and just the idea that you’re going to sort of publicize these these numbers that are representative of ways you’re closing the racial wealth gap, and a lot of them are your business, like, how about not putting a number value on it, and instead, evaluating what you’re doing, that could be contributing to the racial wealth gap and say, forever, after we will change this practice and do better. And this, this is how we crunched the numbers on how it’s gonna close the racial wealth gap. No one is doing that.


ASANTE-MUHAMMAD: Because the way numbers are played with right where they will say, Oh, you know, we’re a billion dollars or $500 million toward closing the racial wealth gap. But that oftentimes just means well, we’re trying to sell this many mortgages to blacks, or Latinos. And then that’s their charitable work by actually selling mortgages. And it might not even clear up the increase over time like, well, is this increasing? Is there an increase in mortgages? Is this going to close? The homeownership divide? That has been pretty steady between blacks and whites for the last 100 years? Or if there is no calculation of that, then we’re not really dealing with the problem. We’re just kind of dealing with promotional material. But let me ask you because we’re running out of time. I was surprised again, I just I heard your conversation on the on a podcast and I went got the book. And then I saw how much you would cite it different aspects of NCRC is work that you can be quoting Jesse Vento and John Taylor and just, you know, what? I think we at NCRC you know, we know about NCRC but we’re not really clear on the kind of national impact and and how others looking outside and so if you could tell us a little bit about why you utilize NCRC so much and how it helped with different aspects of the book.


FLITTER: Well, I really liked the mystery shopper research and it was different from anything out there and for my book, just because of like who I am and You know, the kind of work that I do, I, I felt like stories and not numbers were going to be the backbone of the book. But I also was, was really sort of impressed by how few studies are willing to take on racism and racist treatment like head on and the NCRC is mystery shoppers did that and do that, and, you know, obviously in partnership with the academics who, who work with with them on these studies, and so I just, there’s nothing else quite like it. And I, you know, relied on that. So yeah,


ASANTE-MUHAMMAD: It’s great to hear. I’m gonna take one question, definitely, we’ll take it from our esteemed expert, Josh silver. And he he put forward a question about should we encourage financial advisors to serve underserved communities, and also require their firms to restructure their compensation so as to encourage advisors to serve poor areas as well as in fluid ones?


FLITTER: Well, I don’t think the problem is that financial advisors aren’t serving under privileged communities or, or low income communities. And I don’t want to take up too much time. But in the, in the book, there’s a whole chapter that talks about how JP Morgan has a two tiered structure for its advisory business. So there’s like the retail side and then the private client advisors, which you have to have a certain amount of money to qualify for Chase private client products and, and you get a different financial advisor. The financial advisors who work for Chase want to be managing more money. And if they’re black, they, you know, have ended up getting basically told, like, you’re not a good fit for this, this program. The and then, in the book, and in my reporting for The New York Times, I found I, I exposed a case in which a financial adviser who wasn’t being allowed to be a private client advisor also tried to bring in money from the clients that he could interact with. And he went to his boss and said, I have a woman with $400,000, who got the money from a settlement with a city over the death of her son, and she was black. And he recorded his boss saying, This isn’t money she earned. She doesn’t deserve it. It’s going to be gone in 18 months. And so who are we blaming for this? This mire that we’re in? It’s not like financial advisors should be doing more to serve underserved communities. It’s that every aspect of every step of this is is full of discrimination.


ASANTE-MUHAMMAD: Well, I think we’re gonna have to end on this note, because we have another speaking coming up. But Emily will be here to sign copies of the book, The White Wall: How Big Finance Bankrupts Black America — and Emily, thanks a lot for coming out.


FLITTER: Thank you for having me. It’s been a pleasure.

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