LOS ANGELES — A federal judge has granted final approval of a class-action settlement between Kinecta Credit Union, recipients of Deferred Action for Childhood Arrivals (DACA), and other immigrants who were denied full consideration for credit because of their immigration status.
MALDEF (Mexican American Legal Defense and Educational Fund) represents DACA recipients and other immigrants who comprise the settlement class.
“Credit unions continue to play a critical role in our financial system, and they must do so without engaging in irrational and unlawful discrimination,” said Thomas A. Saenz, MALDEF president and general counsel. “That includes discrimination against immigrants, regardless of how tawdry and irresponsible the rhetoric from our nation’s capital may be.”
As part of the agreement, which received preliminary approval on Jan. 30, 2025, Kinecta has agreed to create a settlement fund of $77,500 to compensate the class of immigrants affected by the challenged practice. Kinecta will also correct its practices and re-train staff as part of the agreement. The settlement is one of more than a dozen MALDEF has reached with financial institutions that deny services to DACA recipients and other immigrants because of their immigration status rather than their credit-worthiness.
Among other agreements, the settlement provides for $2,500 payments each to 31 class members. Kinecta must also pay attorneys’ fees and other costs.
“Meaningful access to financial institutions requires consistency in policy and practice,” said Eduardo Casas, MALDEF attorney. “We are glad that Kinecta has agreed to retrain its staff so that what happened to Mr. Esqueda does not happen to anyone else.”
MALDEF filed the suit in May 2024 on behalf of Rogelio Esqueda, a DACA recipient, who applied to Kinecta for an auto loan but was turned down because he obtained his social security card through DACA. Attorneys argued that Kinecta’s denial of a loan to Esqueda violated Section 1981 of the federal Civil Rights Act of 1866 and the California Unruh Civil Rights Act. Both laws prohibit discrimination based on national origin, citizenship, and immigration status. The lawsuit was filed in U.S. District Court for the Central District of California.
“I am grateful that DACA recipients stand together as a community against the obstacles that we face in this society,” said Esqueda. “Our society pushes immigrants away like we are not a part of it, but we are here making changes in the face of those who don't believe in us.”
Kinecta Federal Credit Union, based in Manhattan Beach, has 25 offices in two states with assets in excess of $6.8 billion and more than 270,000 members.
Since 2017, MALDEF has filed 22 lawsuits challenging the policies of financial institutions that discriminate against immigrants.