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Racial steering alleged at DuPage Co. real estate firm
By Christy Gutowski | Daily Herald Staff
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Published: 7/29/2008 11:55 AM | Updated: 7/29/2008 6:25 PM

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A suburban realty company is accused in a federal lawsuit of racial discrimination alleging it steered minorities into certain neighborhoods.

The suit against Re/Max East-West is based on allegations uncovered during a National Fair Housing Alliance undercover investigation three years ago. The watchdog group said agents repeatedly steered potential white and Latino homebuyers to areas based on their race.

Latino "testers" posing as potential home buyers were encouraged to look in minority neighborhoods, even if they could afford to buy in more affluent areas, the housing group claims. White testers, though, were discouraged from buying in the poorer, minority areas and instead were taken to view homes in predominantly white areas such as Bartlett, Geneva and St. Charles.

"That agents of Re/Max East-West were allowed to engage in such blatant discriminatory behavior is outrageous," said Shanna L. Smith, president and CEO of the National Fair Housing Alliance. "It is sad to think of how much the community's residential segregation can be attributed directly to their sale prices."

Re/Max East-West, based in Elmhurst, serves Cook and DuPage counties. The office has operated for about 30 years and hasn't faced similar allegations before, said John Wassinger, a principal partner who bought the business in 2006. after the undercover investigation. He said his agents undergo mandatory continuing education every two years, including on fair housing laws.

"If there is anything that is a mantra in this industry, it is that everyone is to be treated fairly and blindly," Wassinger said. "That type of activity (racial steering) isn't tolerated."

The housing alliance filed a complaint three years ago with the U.S. Department of Housing and Urban Development, which issued a charge of discrimination June 9. The U.S. Justice Department in turn filed suit July 18.

The federal lawsuit also singles out former Re/Max agent John DeJohn, who is accused of making discriminatory statements. A white tester claimed DeJohn said, "If we go to an area and you don't like it, just let me know. I can't be a bigot but you can be one." Furthermore, DeJohn is accused of telling a white tester that two homes they viewed in minority areas were "dumps," and "repos," even though he allegedly told a Latino tester that one of those same homes "might be good for you."

DeJohn, who left Re/Max in 2004 and now works for a Hillside real estate firm, could not be reached for comment Tuesday. But he denied the allegations when they first surfaced in August 2005.

"Never. Ever," he told the Daily Herald. "I will sell to anyone, anywhere."

Chris Carlos, who represents both Re/Max East-West and DeJohn, added: "Both of my clients deny the allegations and are looking forward to proving their innocence if need be through litigation," said Chris Carlos, who represents both Re/Max East-West and DeJohn.

The National Fair Housing Alliance tested several real estate offices as part of a 12-city investigation in which officials said they found an 87 percent rate of racial steering and an almost 20 percent rate of denial for African-Americans and Latinos.