Wells Fargo Still Sucking After All These Years

 New York City has announced that it is refusing to open new accounts with the financial company after a Bloomberg News study showed that the bank rejected more than half of its Black applicants looking to refinance their homes in 2020.

City Council Member Justin Brannan, chair of the committee on finance, called the disparity "indefensible” and “outrageous” in a news release from the mayor's office. "In a world where we already expect big banks to flout the law and make their own rules, Wells Fargo really outdid themselves," he said. "Over the past two years – of all the major mortgage lenders – Wells Fargo was alone in rejecting more Black homeowners than it accepted. These brazen and illegal discriminatory actions have no place in New York City."

In a letter to Wells Fargo CEO & President Charles Scharf, Mayor Eric Adams and Comptroller Brad Lander said, "We are both gravely concerned about the recent report in Bloomberg that Wells Fargo rejected over half of Black applicants seeking to refinance their homes in 2020 while approving over 70% of white applicants.  These disparate mortgage practices, layered upon a checkered history of steering homeowners of color into subprime mortgages, rejecting mortgages in redlined neighborhoods, and numerous outstanding consent decrees pertaining to mortgage practices, require a swift response by both your bank and stakeholders."

But Wells Fargo has a history of dubious banking practices.  In 2012, the financial services company settled a $175 million lawsuit accusing the company of charging black and Latino customers higher rates on mortgages.  In 2018, the city of Sacramento accused the bank of a "long-standing pattern and practice" of illegal lending that lowered home values, upped foreclosures, and capped property tax revenue used to fund schools in minority communities.  In 2019, The Philadelphia Inquirer reported that the company is set to pay Philadelphia $10 million to settle a lawsuit alleging lending discrimination targeting minorities. 

In 2020, the same year that Wells Fargo agreed to pay $7.8 million in back wages and interest to resolve allegations of hiring discrimination, the company approved only 47% of refinancing applications launched by Black homeowners, according to the Bloomberg News report. That approval number for white homeowners was 72%.