Record Penalty OKd in Housing Discrimination Case : Bias: Owners of Michigan apartment complexes will pay $350,000 to settle U.S. charges that they turned away blacks.

The Justice Department announced Monday that it has negotiated a record civil penalty and settlement against property owners accused of turning away blacks posing as renters in a government effort to root out housing discrimination.

The $350,000 settlement with the owners of two Michigan apartment complexes is the first case to be resolved under a 4-year-old program authorizing the government to conduct random tests to detect discriminatory practices.

Five similar cases are pending against other landlords in suburban Detroit. In each case, trained pairs of blacks and whites posing as prospective tenants were sent to apartments to ask about available units. The white testers allegedly were told about available apartments, while the blacks were told there were none.

Similar testing efforts are in progress in six other metropolitan areas across the country, a Justice Department official said, adding that the tests are not limited to discrimination against blacks.

James P. Turner, acting assistant attorney general for civil rights, declined to say whether Los Angeles is one of the cities but noted that all six have a history of de facto segregation in housing. “It doesn’t make any sense to warn off landlords” by identifying the target cities, he said.

The Michigan cases arise from the department’s first testing involving random evaluations to identify and eliminate housing discrimination. Metropolitan Detroit was picked because it is one of the most segregated areas in the nation, the department said.

The first case was filed against the owners and manager of Rivercrest Arms Apartments, a 268-unit complex in Clinton Township outside Detroit, and Terra Bella Apartments, an 18-unit complex in St. Clair Shores.

The defendants, while denying wrongdoing, have agreed to pay $225,000 to alleged victims of the discrimination and a $125,000 civil penalty to the U.S. Treasury. In addition, they must underwrite advertising to try to locate individuals who were unlawfully turned away.

Turner said that settlements of that size “should serve as a warning to all housing providers that the Department of Justice is committed not only to uncovering unlawful discrimination, but also to ensuring that it is punished severely. Discrimination is illegal, and it’s expensive.”

The department turned to testing after Congress in 1989 amended the Fair Housing Act to authorize the civil rights enforcers to seek civil penalties and monetary damages for victims of housing discrimination instead of asking a court to bar the practice through injunction.

“Random testing is a critical tool for identifying discrimination, because sometimes it is so subtle (that) victims don’t know it’s happening to them,” Turner said. “If we only tested on the basis of complaints, we would not be able to truly attack a covert problem.”

In the suburban Detroit cases, the department contracted with the Fair Housing Center of Metropolitan Detroit, a private organization, to conduct the tests.

In other cases, the department is using more than 100 volunteers who are recruited from its ranks and trained in testing, Turner said. They are fitted with hidden microphones to gather evidence.

When former Atty. Gen. William P. Barr first announced the testing program in November, 1991, some $1.5 million was earmarked for the effort but it was siphoned off by other demands, Turner noted. As a result, the civil rights division turned to volunteers and diverted funds from other division programs.