Real Estate & Property Law
Wells Fargo Settles With NAACP, But 2 Cities File New Fair Lending Suits
Posted Apr 8, 2010 6:22 PM CDT
By Martha Neil
Wells Fargo has just settled a fair housing lawsuit brought by the National Association for the Advancement of Colored People. But the bank's court battle over its alleged discriminatory lending practices isn't over yet.
Two cities filed amended federal fair housing complaints against Wells Fargo this week, in which they contend that the bank's discriminatory lending practices are reducing their tax revenue and increasing the cost of municipal services, reports Reuters.
The Baltimore and Memphis lawsuits contend that expensive mortgages into which black borrowers were allegedly steered by Wells Fargo & Co. have led to home foreclosures that are depleting government coffers. They were filed yesterday in U.S. District Court in Maryland and Tennessee, respectively.
"We stand by our fair and responsible lending practices," responded a spokesman for Wells Fargo, Oscar Suris. "We believe we can accomplish more for homeowners through working with communities than having to respond to litigation. It is our hope that Baltimore and Memphis make that same choice soon."
The NAACP suit continues against 14 other mortgage lenders. It didn't seek monetary damages, and in the settlement yesterday Wells Fargo agreed to let the civil rights group monitor its lending practices, reports the Associated Press.
The NAACP praises Wells Fargo for its "leadership role" in a written statement about the settlement, saying that the bank is "the first to embrace our principles" and suggesting that the settlement could be "a model for collaborating with other financial institutions.”
An article in the Money & Company blog of the Los Angeles Times gives more details about the settlement.
ABAJournal.com: "Baltimore Sues Bank for Lost Tax Revenue Due to Foreclosures"