Larry, Melosa: Just more of the same same that both of you were talking about the other day and yesterday.
WASHINGTON — The Department of Justice is preparing a lawsuit against Wells Fargo, the nation’s largest home mortgage lender, for allegedly preying upon African American borrowers during the housing bubble and steering them into high-cost subprime loans, according to three people with direct knowledge of the probe.
The company, the fourth-largest U.S. bank by assets, is currently embroiled in pre-lawsuit negotiations with the Justice Department in hopes it will settle the accusations and avoid a public lawsuit, these people said.
The allegations mirror those in public actions taken by the Federal Reserve and a separate lawsuit filed by the city of Baltimore.
Last week, the Fed said that perhaps more than 10,000 borrowers were inappropriately steered into subprime mortgage loans or had their loan documents falsified by bank personnel. Wells Fargo agreed to pay $85 million to settle the civil charges. It did not admit wrongdoing.
In its ongoing case against Baltimore, Wells Fargo stands accused of using those same practices, but deploying them against black borrowers in majority-black neighborhoods, an act commonly known as “reverse redlining.” The city alleges that the bank targeted black borrowers, knowing they’d ultimately default on their loans, but did not fear shouldering the cost because Wells sold those loans to investors. Wells Fargo denies the allegations.
“We have a very strong commitment to serving all customers along the credit spectrum, and we do so without bias,” said Vickee Adams, a spokeswoman for Wells Fargo. “That’s the type of responsible lending that we practice.” Adams declined to comment on the Justice probe.
The previously-undisclosed Justice probe, which is being led by the Civil Rights division’s Fair Lending Unit, lends credence to the city’s lawsuit, sources told The Huffington Post. The official overseeing the office, Assistant Attorney General Thomas E. Perez, previously served as secretary of Maryland’s Department of Labor, Licensing and Regulation, a consumer protection agency that regulates mortgage and foreclosure terms and houses the state’s financial regulator.
Taken together, the various investigations paint a picture of a lender that profited by knowingly targeting less-sophisticated borrowers, in particular preying upon those communities that traditionally lacked access to a full range of consumer credit products.
They also add up to significant blows to the bank’s once-pristine reputation. Widely seen as the most innocent of the biggest mortgage lenders, Wells Fargo executives were spared the humiliation of having to answer critical questions in public from the Financial Crisis Inquiry Commission, and unlike its competitors, the bank’s pre-crisis activities were never the subject of the commission’s hearings.
But over the past year, that reputation has begun to crumble.
Wells Fargo has fought lawsuits from Baltimore and the city of Memphis alleging that the bank preyed upon black borrowers; settled claims it illegally steered credit-worthy borrowers into subprime loans and misled investors about the risks of mortgage-backed securities it sold; and fought investigations and regulatory actions stemming from revelations that it employed so-called “robo-signers,” the agents directed by lenders to process foreclosure filings en masse without examining the underlying paperwork.
The bank, along with four other companies, is also the subject of confidential audits by the Department of Housing and Urban Development that accuse the lender of defrauding taxpayers in its handling of foreclosures on homes purchased with government-backed loans, HuffPost reported in May.
Wells Fargo is in the middle of negotiations to settle state and federal allegations that it mistreated borrowers and in some cases illegally foreclosed on them. It could cost the bank billions of dollars.
The Justice probe signals that the agency, after battling claims that it’s been too easy on major mortgage firms in the wake of the financial crisis, may be toughening its approach. Its fair lending unit has about 60 open matters, Perez said in a June 1 speech. It currently has more than 15 ongoing investigations involving allegations of discriminatory lending.
A Justice Department spokeswoman declined to comment on the Wells Fargo investigation.
In an April 5 report to Congress, Perez’s unit said that some of these investigations would lead to lawsuits or settlements this year.
“We’re a majority African American community, and there are people in this city who take great offense when institutions take advantage of a community’s historical lack of access to credit, and in some cases lack of sophistication, by putting them in loans they can’t afford,” said George Nilson, Baltimore’s city solicitor. “It’s offensive behavior and we shouldn’t tolerate it.”
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Linda: Thanks for sharing your story. I had a feeling a man didn’t have to get permission from his wife. And it is no surprise that he doesn’t even get asked to share it with her.
As far as the women voting as their men tell them to – ugh! I hate hearing that but I know it is too true. Women outnumber men in our country, and we still can’t get enough women to vote women into office. And I’m not jut talking about any woman. But it sure would be great if women supported men, like men support men. Men will vote in the worst man for the job just because he is a man. Although don’t get me wrong, I’m not saying we women should do that too, because some of the women such as Palin and Bachmann are not women I will support. However the more women we support in politics, the more women will run…at least I HOPE. And I HOPE women who are avid supporters of women will enter into politics. It’s time.
As far as envying the independence of minority women, revel in your own independence and join the force. It’s never too late. As Henrietta stated with respect to white male control of our government, “Most of those draconian laws stood until women and OTWs became a viable force in America’s politics.” We are a country of women that are blessed to be able to speak our minds – don’t let yours go to waste. As I said, “It’s time”.
John: Thanks for your offer but I can not accept it. What can I say? You and other men are just going to have to wait until the women feel the men are ready to go. Women have had to wait for whatever reason men deemed necessary until men felt they were ready. Some women have waited for 2000 years and some are still waiting.
If you love women so much…if you know you’ll miss your mother and sister so much, how about doing them proud? How about getting involved while you’re here on this beloved planet that man has created to his liking, and start supporting women and advancing women’s issues? That would be a good start. Then how about taking some of that 200 million and fund a charity strictly in suppot of women and women’s issues, and run it in honor of your mother and sister? Now, that would do them proud.
Until men “man-up”, and support all women, treat them as equals, this opportunity is strictly for girls. John, I look forward to seeing what you do with your life in support of women.
Stanley: With respect to Madaline, your assessment is so true, and you are no doubt a definite reason why Madaline wouldn’t beam you the fuck up. Try getting a new attitude, and supporting all your fellow Earthlings, and perhaps one day that will change. But until then, your “position” solely remains on this planet. I’ll echo Jose…”lucky for you”.
Zen Lill: Huh…so interesting. I just recently asked my girlfriend if she was asked by her husband’s doctor for her approval. She said that he made the appointment, went in, and had it done without any word from her. So, it really surprises me that they asked if you were okay with the decision. And what if you said “No”? We all know what would happen if a man objected to his wife’s tubal Ligation.
Peace out.
Lastly, greed over a great story is surfacing from my “loyal”(?) readers. With all this back and forth about who owns what, that appears on my blog, let me reiterate that all material posted on my blog becomes the sole property of my blog. If you want to reserve any proprietary rights don’t post it to my blog. I will prominently display this caveat on my blog from now on to remind those who may have forgotten this notice.
Gratefully your blog host,
michelle
Aka BABE: We all know what this means by now :)
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