BEMIDJI -- A Bemidji area real estate company, as well as two homeowners it represents, will pay $74,000 collectively to settle a discrimination case with a small group of potential tenants more than two years after the incident.

The U.S. Department of Housing and Urban Development issued a statement Tuesday, announcing that Lakes and More Realty had reached an agreement with the prospective tenants, whose names were redacted.

In addition to the financial compensation, the agreement stipulated that the realtor named in the settlement, Barbara Raymond of Lakes and More Realty, attend fair housing training as well as a multicultural sensitivity course.

“Denying a family housing because of their ethnicity (or) familial makeup not only robs them of a place to call home, it violates the law,” Anna María Farías, assistant secretary for Fair Housing and Equal Opportunity, said in the press release. “Today’s announcement reaffirms HUD’s commitment to protecting the housing rights of families and ensuring that all landlords comply with the Fair Housing Act.”

The case originated in September 2016 when the unnamed tenants inquired about renting a six-bedroom home on eight acres of land. The tenants included a woman, her two sons and her partner; as well as another couple and their five minor children. The tenants were of both Native American and Mexican descent and amounted to 11 people.

The realty company claimed that it declined the application since the home’s septic system would only accommodate 10 people. The realty then allegedly offered to rent the home to the tenants for $1,000 more a month in addition to requiring a security deposit.

Raymond denied any wrongdoing. She indicated both in the HUD documentation, as well as through her attorney on Wednesday, that she turned down the tenants because there would have been too many people for the home’s infrastructure.

“Barb has denied any wrongdoing throughout this case and has stated that the reason these people were denied the ability to rent this property was solely and exclusively because the septic system could not sustain that number of people in the property,” Raymond’s attorney David McGee said. “We made that clear to HUD from the beginning.”

According to the HUD documents, the defendants also denied the allegation that they offered to raise the rent by $1,000 a month.

The HUD documentation also said the defendants agreed to settle the matter “to avoid uncertain and costly litigation.”

“It was just a matter of bringing it to a conclusion,” McGee said about the settlement.

Lakes and More Realty was leasing the house on behalf of its owners, Hans and Corie Serleth. Although the brunt of the settlement’s expense fell on the shoulders of Raymond and the real estate company, the agreement also mandated the Serleths pay a total of $9,000 to the tenants. Like Raymond, however, they also denied any wrongdoing in the matter and chose to settle to avoid litigation.

“The Serleths deny that they discriminated against the complainants on any basis,” their attorney, Ranelle Leier, said. “They never met or spoke with the family seeking to rent the house, and instead relied on their real estate agent. Given the time and money involved in defending themselves, however, the Serleths agreed to settle the matter.”