Bank of America Sued by Black Ex-Manager Alleging Bias

Bank of America Corp. was sued by a former employee who alleged the bank segregates black workers in an “apartheid” system that creates a “vast inequality” in business development, compensation and advancement.

Jack Mitchell, who is black, filed the lawsuit today in federal court in New York. He was employed as a “premier client manager” from February 2007 to July 2008, working with high net-worth customers, and was fired for speaking out against what he described as a “discriminatory system,” according to the complaint.

“The bank’s apartheid system of business allocation created a vast inequality in business development and career growth opportunities between the bank’s African American and white employees,” Mitchell alleged in the complaint. He is seeking at least $10 million in damages.

Bank of America paired managers with financial advisers in teams, with compensation based on the value of assets in each team’s portfolio, Mitchell said. The bank “segregated” black workers by assigning them to work at branches in low-income and minority areas, he said. Mitchell claims all of the members of his team were black and he was denied repeated requests to transfer to other branches.

The refusals were “based on the bank’s racist belief that its white clients and/or white prospective clients would not wish to do business with the bank’s small number of African American employees,” Christopher Brennan, Mitchell’s lawyer, alleged in the complaint.

Bill Halldin, a spokesman for Charlotte, North Carolina- based Bank of America, said the bank had just received the complaint and declined to comment on it specifically.

‘Core Values’

“Diversity and inclusion are part of Bank of America’s culture and core values,” Halldin said in a statement. “We actively promote an environment where all associates have the opportunity to achieve personal success and can contribute to the growth in our business.”

In a separate suit filed today in federal court in New York, Cantor Fitzgerald LP was sued by Jermaine James, a former employee its equity department who is black. James, who said he was employed at Cantor Fitzgerald from October 2004 to July 2008, alleged he was the victim of wrongful discharge and employment discrimination based on his race.

James claimed that white coworkers subjected him to “pervasive” harassment, including emitting “monkey noises” and uttering racial slurs in his presence at boardroom meetings.

Fire Alarm

When a fire alarm went off in the building, another employee suggested it was triggered by “too many blacks” congregating in the area, James said.

When James complained, a superior told him that he “needed to be around his own people,” according to the complaint. James said he was fired even after becoming the highest-grossing salesman at a minority-owned brokerage unit of Cantor’s.

Cantor doesn’t comment on litigation, Sheryl Lee, a spokeswoman for the New York-based company, said in an e-mail.

The cases are Mitchell v. Bank of America NA, 12-CV-5593, and James v. Cantor Fitzgerald LP, 12-CV-5374, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporter on this story: Patricia Hurtado in New York at pathurtado@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net