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April 15, 2022 at 02:24 PM
What You Need to Know
- A recent investigation found the bank approved 47% of Black applicants for mortgage refinancing vs. 72% of white applicants.
Ben Crump, the high-profile lawyer for the families of Black victims of police violence including George Floyd and Breonna Taylor, has joined a lawsuit against Wells Fargo & Co. over racial disparities in its home-lending practices and called for local governments and other institutions around the country to stop doing business with the bank.
In an amended complaint filed in federal court in San Francisco on Thursday, Crump joined an existing lawsuit brought in February by Chris Williams, a Black homeowner in Georgia who claims Wells Fargo sought to charge him a higher interest rate than his credit score called for when he went to refinance the mortgage on his home in 2019. Two new plaintiffs also joined the suit, for which lawyers are seeking class-action status.
Crump’s involvement in the case follows the publication of a Bloomberg News investigation last month that found Wells Fargo approved just 47% of Black homeowners who completed applications to refinance mortgages in 2020 compared with 72% of white applicants. Its approval rate for Black homeowners during what was the first year of a $5 trillion pandemic refinancing boom trailed other major banks and nonbank lenders.
“I believe that just like police brutality killed Black lives, the discrimination that’s exhibited by Wells Fargo killed Black opportunities,” Crump said in an interview. “They just systematically are killing Black homeowners’ spirit each time they are denied their opportunity at their American dream.”
Crump, who in recent years has focused on cases involving police violence, said he was eager to highlight the economic impact of lending discrimination and what he called “one of the most profound civil rights issues of our day.”
He said he would also be leading a public campaign to have municipal governments, schools, state pension funds and other institutions stop doing business with Wells Fargo.
“If Wells Fargo does not change their ways, these discriminatory practices, then we’re going to implore those people of color who sit in decision-making roles as well as people of good conscience and say, ‘We should not support financial institutions who engage in discriminatory practices against minorities in America,’” Crump said.
The company has said in recent weeks that “additional, legitimate, credit-related factors” were responsible for the differences, not discrimination. The bank on Wednesday announced a package of efforts to expand racial equity, including a pledge to spend $150 million to lower mortgage rates and reduce refinancing costs for minority homeowners.
Other Actions Affecting the Bank
Since the Bloomberg story, lawmakers in Congress have asked the Consumer Financial Protection Bureau and the U.S. Department of Housing and Urban Development to review the bank’s lending practices.
