The Philadelphia Inquirer reports in a federal lawsuit, Philadelphia accuses Wells Fargo & Co. of issuing predatory loans to more than 1,000 Black and Latino home buyers in the city since 2004.
The city’s lawsuit alleges that the bank overcharged minority borrowers for loans the bank knew or should have known would end in foreclosures, unpaid taxes to the city, and diminished property values. Wells Fargo’s actions violate the federal Fair Housing Act, the suit alleges.
Wells Fargo disputes the claims, calling them “unsubstantiated accusations,” The Inquirer reported.
In 2012, Wells Fargo settled a fair lending lawsuit with the U.S. Justice Department. The bank agreed to pay $175 million to resolve allegations that it charged Blacks and Hispanics high rates and fees on mortgages from 2004 through 2009, even though the borrowers qualified for better loans.
It was, at that time, the second largest fair lending settlement in the department’s history. The bank did not admit wrongdoing in that case and said it settled the matter to avoid costly litigation. News of the Philadelphia lawsuit against Wells Fargo was first reported by Reuters.