PA Human Relations Commission Alleges ‘Reverse Redlining’ Against Wells Fargo

The Pennsylvania Human Relations Commission filed a complaint against Wells Fargo Bank early this month, claiming that the bank used reverse redlining in Philadelphia neighborhoods. In other words, Wells Fargo is accused of exploiting poor, African-American residents by allowing an abundant of sub-prime loans in densely black-populated neighborhoods that ultimately caused thousands of vacant properties.

Among other allegations, the complaint claims that:

“Approximately 8.2% of respondents’ loans in Philadelphia’s predominately African-American neighborhoods result in foreclosure, but the same is true for only 2.0% of loans in predominantly white neighborhoods. Respondents’ disproportionately high foreclosure rate in Philadelphia’s African American neighborhoods is the result of reverse redlining.”

James Baum, a communication’s manager for Wells Fargo, basically told PhillyNow in an e-mail that the allegations are (what else,) full of shit:

We do not tolerate discrimination against, or unfair treatment of, any consumer. We practice responsible lending with the overarching principle of only approving mortgage loan applications where we believe the borrower has the ability to repay the loan, and our loan decisions are based on credit and transaction risk. We are committed to serving all customers responsibly and fairly, and we will vigorously defend the Commission’s unfounded claims.”

Philadelphia joins Baltimore and Memphis, cities that also have filed similar suits against the bank for racial discrimination.

But it’s not the first time a Pennsylvania entity sued a big bank due to the the recession and housing crisis. Philadelphia’s Board of Pensions and Retirement did just that less than a month ago.

2 Responses to “ PA Human Relations Commission Alleges ‘Reverse Redlining’ Against Wells Fargo ”

  1. Michael says:

    |”allegations are full of shit”

    Did he really say that in a corporate email?

  2. Donna says:

    Wells Fargo stated that “We practice responsible lending” However, the loan wellsfargo made to us clearly should be voided.

    1. it is illegal for Wells Fargo to make mortgage loan to us based on hugely inflated appraisal.

    Fact: – Wells Fargo’s fraudulent appraisal valued our home at $718,000
    – Wells Fargo’s own review appraisal valued our home at $475,000
    – Nevada Attorney General’s office suspended the appraiser’s license for committing appraisal fraud on our home.
    – Nevada Appraiser Licensing Board mandated the appraiser to complete appraisal fraud course before regaining his real estate appraiser license.
    – Nevada Revised Statue NRS 205.372 states that it’s category C felony to make mortgage loans based on fraudulent appraisal.
    – Cases of Attorney General’s indictments against attorneys, loan brokers for teaming up make fraudulent loans to defraud homeowners.

    2. it is illegal for Wells Fargo to wrongfully foreclose our home based on fraudulent appraisal and mortgage loan.

    You can find all the facts on our website.

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