Mississippi landlords pay $330,000 and give up management of properties to settle race case

The Justice Department has settled a federal lawsuit in which three Mississippi landlords will give up management of their rental properties and pay $330,000 to resolve allegations that they used racially coded vacancy lists and telephone logs to segregate and exclude African Americans from apartment complexes, mobile home parks, and other properties. The court-approved settlement resolves complaints that the defendants racially discriminated in virtually every aspect of their residential rental property business. 

Employees steered African Americans and whites, reserving better homes for white renters

The lawsuit accused Alden "Bubber" Wallace, III; his wife Priscilla Wallace; and his mother Nell Wallace of violating the federal Fair Housing Act by dividing their Meridian, Mississippi rental properties into better quality "White" or "No. 1" homes and inferior quality "Black" or "No. 2" homes.

White renters were steered to "No. 1" homes and African American renters were steered to substandard "No. 2" properties. The Wallaces, operating through four Mississippi companies, allegedly required employees to code telephone inquiries according to a race-based system and prohibit African American and mixed-race families from renting "No. 1" properties. The lawsuit also accused the defendants of ignoring maintenance problems at the "Black" or "No. 2" properties and evicting African American and mixed-race families who were mistakenly placed in "No. 1" properties. 

The consent decree, approved by Chief Judge Tom Lee of the U.S. District Court in Jackson, Mississippi, requires the Wallaces to pay $310,000 into a victims fund and a $20,000 civil penalty to the U.S. Treasury. The fund will compensate identified victims of discrimination. In addition, the defendants must turn over management of their more than 200 residential properties to an outside company to be approved by the Justice Department. The settlement permanently bars Mr. Wallace, his wife, and his mother from any involvement in tenant affairs, including tenant selection, maintenance, and evictions. Mr. Wallace is prohibited from entering properties unless they are vacant and only if he is escorted by management company staff. The settlement requires fair housing training, implementation of new policies, and five years of monitoring.

DOJ: discriminators will "pay a heavy price"

"It is shocking and sad that some landlords still go to such lengths to engage in racial discrimination," said Ralph F. Boyd, Jr., Assistant Attorney General for the Justice Department’s Civil Rights Division. "This settlement sends the message that landlords who discriminate on the basis of race will pay a heavy price." 

Dunn Lampton, United States Attorney for the Southern District of Mississippi said, "This case is offensive because people were placed on racially coded lists for housing based not only on the color of their skin, but also because of the sound of their voice. This is the first settlement in a race discrimination case which permanently bars the individual defendants from the management of their properties and it should serve as a wake-up call to any landlords engaged in similar conduct."

Properties included in the settlement are homes throughout the city of Meridian, the Valley Mobile Home Park, Louie Lee Apartments, and homes on Jeffrey Acres Road, Causeyville Road, and Long’s Lane. 

The Justice Department is asking persons who think they may have been harmed by the Wallace’s alleged racial discrimination to contact the United States Attorney’s Office at 601-965-4480.