Mercantile Bank Accused of Kicking Out Black Clients, Killing Several Businesses


By Victor Ochieng

Several black business owners have gone to court contending that Mercantile Bank strategically did away with loans held by blacks, resulting in the destruction of several black owned-businesses in Grand Rapids, Michigan. A barbeque restaurant has also joined the growing list of business owners in the lawsuit.

The case became the ninth one to be filed in U.S. District Court in Grand Rapids after being removed from Kent County Circuit Court.

The estates of the black business owners made the filing through the bankruptcy trustee on October 28, 2015.

The barbecue restaurant owner, Randall Sandifer, and his wife revealed that they received a 20-year construction loan of $330,000 from the bank in 2004, which they were to use to renovate their restaurant. They kept up to date with the loan repayment until 2008 until they fell behind on payments. The bank didn’t take any action against them until December 2012 when they received word from the bank that their $326,362.22 loan was due that month, wrote attorney Derek Witte in the lawsuit.

According to Sandifer, the bank foreclosed, forcing the restaurant to close down.

“Mercantile called the Plaintiffs’ debts as part of its ‘concerted’ effort to rid itself of black business borrowers,” Witte said.

The lawsuit seeks to prove that the defendant discriminated against the business owners because they’re black.

“Defendants discriminated against Plaintiffs because of their race by using subterfuge and pretext to get Plaintiffs to pay cash penalties and/or provide additional security for existing debts when the bank simultaneously planned to terminate its banking relationship with Plaintiffs, all without taking the same steps with substantially similarly situated white business borrowers,” Witte wrote.

The plaintiffs have claimed that at the onset, the bank focused on increasing its loans to minorities, but later on things took a different turn. They incite that the bank was more willing to work with whites, including struggling ones, but not blacks.

“Mercantile aggressively called the loans on most, if not all, of the minority owned businesses it had recently targeted,” attorney Jordan Hoyer said.

Inner City Press/Fair Finance Watch, a nonprofit, began investigating the bank in 2011 after it realized that the bank wasn’t giving out any loans to minority groups.

However, the bank has defended its practices and has stated that it has an “outstanding record of helping to meet the credit needs of its assessment area.”


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