Fresno, California, June 1, 2022 – A Latin American civil rights organization today filed a federal class action lawsuit against a Central California credit union that unlawfully denied membership and a loan to a DACA beneficiary because of her status as a immigration.
MALDEF (Mexican American Legal Defense and Educational Fund) sued on behalf of Karla Ayala, recipient of Deferred Action for Childhood Arrivals (DACA), whom Valley First Credit Union told she was not not eligible for a personal loan because of their immigration status.
“California financial institutions must understand that they cannot discriminate based on a person’s nationality or immigration status,” said Thomas A. Saenz, president and general counsel of MALDEF. “This type of unlawful discrimination not only harms individuals, but distorts our economy and diminishes the California dream.”
The lawsuit, filed in the U.S. District Court for the Eastern District of California, challenges Valley First’s refusal to consider Ayala’s application for membership and a loan because she is not a U.S. citizen or permanent resident like a violation of federal law and California Unruh civil rights. Law. Unruh law prohibits discrimination based on race, sex, color, religion, ancestry, national origin, immigration status, age, and other characteristics. The lawsuit also claims that Valley First, a member organization, violated Section 1981 of the Federal Civil Rights Act of 1866, which prohibits discrimination based on alienation.
“We continue to see anti-immigrant discrimination not only by national banks but also by other regional credit unions,” said MALDEF lawyer Deylin Thrift-Viveros. “The Central Valley of California is a region rich in immigrants; It’s unfortunate that a credit union that claims to serve the community has determined that Karla’s DACA documents do not qualify her for membership, even though they do qualify her for employment. We are bringing this case to ensure that Valley First and other financial institutions end this arbitrary discrimination based on immigration status.
Ayala, 24, of Turlock, Calif., started working for Valley First in October 2021. Shortly after, she applied for a $7,000 personal loan through the credit union’s online portal. On November 1, Ayala received an email telling her that the loan had been approved but to receive the funds she would need to join the credit union, open an account and provide a copy of her social security card. As a beneficiary of DACA, Ayala is authorized to work in the United States and holds a social security number for employment purposes.
On November 4, Ayala paid a $5 dues, deposited $25 in a savings account, and uploaded a copy of her Social Security card to Valley First’s website. The next day, Ayala received a voicemail from a Valley First representative telling her that the credit union couldn’t give her a membership or give her a loan with a “work-only social security number.”
Ayala emailed the Valley First rep to make sure that even though she was a Valley First employee, her loan wouldn’t be approved, and the rep replied that Ayala was right. Ayala also received a written notice informing her that she was not eligible for membership, but without giving a reason.
“Being brought to the United States when I was young was already confusing and scary,” Ayala said. “Growing up, I didn’t know the challenges I would face being undocumented. Even with DACA, I was still denied a loan that was going to help me reduce my debt before I enrolled in a nursing program. My good credit didn’t seem to matter as soon as Valley First saw that I wasn’t a US citizen or resident. I am filing this lawsuit because I want to raise awareness of this issue that DACA recipients still struggle with and prevent it from happening to others applying for loans from Valley First.
Valley First Credit Union is based in Modesto, California, and serves members who live, work, attend school, or worship in California’s Central Valley. The credit union offers a range of financial products from checking and savings accounts to personal loans and mortgages to its members.
Read the complaint HERE.
Founded in 1968, MALDEF is the leading Latin American civil rights organization. Often described as the “law firm of the Latin American community”, MALDEF promotes social change through advocacy, communication, community education and litigation in the areas of education, employment, immigrant rights and political access. For more information on MALDEF, please visit: www.maldef.org.