Report Alleges Wells Fargo Engaged in Discriminatory Lending - Black Enterprise
Black Enterprise Magazine July/August 2018 Issue

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(Source: FDIC.gov)

Accusations of predatory lending at Wells Fargo are making news once again. African Americans paid $137 million more to Wells Fargo & Co. than white borrowers, according to a report released today by the National People’s Action (NPA), a grassroots network of organizations hoping to achieve more equity in housing, work, health, education, finance.

“The numbers speak for themselves,” said George Goehl, the NPA’s executive director, of the report that examines Wells Fargo’s lending record between 2004 and 2007. “The fact that a bank with clear disparities in its lending practices can receive $25 billion in federal bank bailout money raises real questions about racial justice in this country,” he added.

African American borrowers at Wells Fargo received high-cost loans that were more expensive than the high-cost loans received by white borrowers, according to the report, “The Truth About Wells Fargo: Irresponsible Lending and African Americans.”

The NPA, a project of the National Training and Information Center, claims that Wells Fargo contributed to the current economic and foreclosure crisis because it issued $27 billion in subprime loans in 2006 alone.

Key findings in the report include:

–More than 37% of all loans made by Wells Fargo to African American borrowers were high-cost loans, compared with 12% of loans received by white borrowers.

–Forty-five percent of all refinance loans received by African American borrowers were high cost, compared with 19% for white borrowers.

–For low- and moderate-income borrowers, 48% of all Wells Fargo loans to African Americans were high-cost loans as compared with 20% of the loans for equivalent white borrowers.

To correct this “despicable” manner of “predatory and discriminating” business, the NPA has a list of recommendations for Wells Fargo. The organization wants the bank to develop a program, with clear goals and strategies, to end racial disparities in its lending programs; provide information that allows for monitoring and measurement of the bank’s ability to achieve racial parity in its lending practices; and support the expansion and strengthening of the Community Reinvestment Act to ensure banks are reinvesting in communities that serve minorities and those with low and moderate incomes.

Separately, last week the NAACP filed a lawsuit against Wells Fargo and New York-based HSBC last week accusing the two banks of practicing predatory and discriminatory lending. Wells Fargo has denied the accusation, saying that it is proud of its “lengthy record leading the industry in responsible lending practices.”

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Marcia Wade Talbert

Marcia is a multimedia content producer focusing on technology at Black Enterprise Magazine. In this capacity she writes and assigns stories to educate readers about social media; digital integration; gadgets, apps, and software for business and professional development; minority tech startups; and careers in STEM (Science, Technology, Engineering, and Mathematics). In 2012, she received two Salute to Excellence Awards from the National Association of Black Journalists and was recognized by Blacks in Technology (BiT) as one of the Top 10 Black achievers in the tech arena for 2011 at SXSW in Austin, Texas. She has spoken about technology on panels for New York Social Media Week, at The 2012 Rainbow/PUSH Wall Street Summit, as well as at Black Enterprise’s Entrepreneurs Conference and Women of Power Summit. In 2011, SocialWayne.com chose her as one of 28 People of Color Impacting the Social Web, and through crowdsourcing she was listed as one of BlackWeb2.0's/HP's 50 Most Notable African American Tastemakers in Social Media and Technology for 2010. Since taking on the role of Tech editor in September 2010, she has conceived and produced five cover stories on Technology and/or STEM and countless articles, videos, and slideshows online. Before joining BlackEnterprise.com as an interactive general assignment reporter in 2008, she freelanced with Black Enterprise beginning in 2003 while working as the technical editor at Prepared Foods magazine. There she further honed her writing skills and became an authority on food ingredients, including ingredients used in food fortification and enrichment. Meanwhile, her freelancing with Black Enterprise and BlackEnterprise.com helped her stay current on issues pertaining to the financial and business welfare of African Americans. As a general reporter for Black Enterprise she attended and reported on the Democratic and Republican National Conventions, where she interviewed Valerie Jarrett, senior advisor and assistant to President Barack Obama and U.S. Attorney General Eric Holder. Marcia has a Bachelor of Science degree in Agriculture with an emphasis in food science from the University of Minnesota, and a Master of Science degree in journalism from Roosevelt University in Chicago. En route to her secondary degree, she served as the editor-in-chief of the Roosevelt University Torch, a weekly, student-run newspaper. An avid photographer and videographer, Marcia is one of several employees at BLACK ENTERPRISE who interned for the publishing company as a college student. She lives in New Jersey with her husband, a food scientist; her seventeen-month-old daughter; and “The Cat”, but still considers Chicago home.


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