The owners of a janitorial company, who are Black, have filed suit against Midland State Bank, accusing the institution of racism and discrimination for allegedly accusing them of fraud when they attempted to access more than $300,000 in loan funds approved for their business by the Small Business Administration.
According to the federal lawsuit by the owners, Delora Brown and Charles Coaty, the bank incorrectly suspected fraud after they received the SBA Economic Injury Disaster loan of $338,700 into their company account in October 2021.
The bank, "without notice, froze and removed the funds from Plaintiffs’ account, returning it to SBA," says the suit, filed in U.S. District Court for the Northern District of Illinois in Rockford.
"On this unfortunate day, Coaty and Brown were reminded that despite their hard work and long relationship with Midland, discrimination still exists and that simply because of the color of their skin Midland’s staff denied them services provided to non-African American customers," the suit says.
Brown was forced to reapply for the loan "which was finally deposited into their account in the Illinois Bank and Trust in August 31, 2022," the suit says.
The lawsuit seeks at least $500,000 in damages, plus attorney fees.
The plaintiffs are represented by Michael Rothman of Rothman Law.