As a result of a civil rights investigation into discriminatory practices against African-American borrowers, Massachusetts Attorney General Martha Coakley has announced a settlement with Mortgage Master Inc. Under the agreement, Mortgage Master will distribute $250,000 to Massachusetts borrowers, consumer organizations and the state. The company will also implement aggressive safeguards to ensure that there are no disparities in the fees or costs charged for a home mortgage loan based on a borrower’s race. “Lenders must take affirmative steps, as Mortgage Master has done, to ensure that fair lending and non-discrimination is the rule, as well as the result,” AG Coakley said. “Where lenders are going to provide room for discretion, they need to make sure that their employees are properly trained and that adequate safeguards are in place to ensure that racial bias does not affect lending decisions.” Mortgage Master will make two financial distributions in connection with this settlement. The first, for $95,000, will be used by the Attorney General’s Office to make payments to African-American borrowers in Massachusetts who obtained a home mortgage loan from the company during the period from 2004 to 2008. An estimated 200 borrowers will receive payments ranging from $250 to $1,000 each. The second distribution, for $155,000, will be granted to not-for-profit groups that provide fair lending, consumer, and financial education services for people in Massachusetts. Mortgage Master has also agreed to take several new steps to ensure compliance with anti-discrimination laws. For each of the next three years, Mortgage Master will train all of its employees about anti-discrimination laws and that training curriculum will be subject to review by the Attorney General’s Office. In addition, for each of the next three years, Mortgage Master will provide its loan data to a pair of fair lending monitors (including one selected by the Attorney General), who will determine whether borrowers have received fair terms of credit. If substantial racial disparities are indicated by the review, Mortgage Master will make a payment to affected borrowers. Finally, Mortgage Master will conduct a full-scale review of its underwriting and loan origination policies, to ensure that appropriate fair lending practices are implemented. Mortgage Master fully cooperated with the Attorney General’s review of this matter.