The U.S. Department of Housing and Urban Development is investigating Maryville-based Clayton Homes over a fair housing complaint.
While there are no specifics about the nature of the complaint against Clayton Homes, which is owned by Warren Buffett, the company has come under scrutiny in the past over complaints about the way Clayton Homes and its financing arm, Vanderbilt Mortgage, treat minority customers.
The Seattle Times and Buzzfeed have published a series of articles accusing Clayton Homes of a number of exploitative practices, including charging minority borrowers higher rates and specifically targeting minority communities using deceptive practices to exploit them.
After a story on Clayton’s business practices in minority communities was published, U.S Representative Maxine Waters of California called on the Justice Department and the Consumer Financial Protection Bureau to investigate the company’s practices.
In a statement to WATE 6 On Your Side, Clayton said:
Over its 60 year history, Clayton Homes has built a culture of compliance and does not tolerate discrimination of any kind in its interactions with customers. We value working with federal and state agencies to improve processes and ensure all regulatory requirements are met and our customers are protected and treated fairly. Last year, our lenders were the subject of more than 40 routine agency examinations resulting in no fines.
According to the Seattle Times, Buffet has defended Clayton’s lending practices, saying loan rates have to do with credit score, earnings and whether the customer owns land, not on their race.
“Does that mean that every single transaction gets handled perfectly? No,” Buffett said in an interview with CNBC in 2016.