Judge certifies lending discrimination case against Wells Fargo
Class action suit asserts bank knowingly discriminated against borrowers in minority neighborhoods
From staff reports
LOS ANGELES—A Los Angeles Superior Court judge yesterday certified a lending discrimination class action against Wells Fargo Bank.
The class action was brought against the lender on behalf of loan customers in minority communities in Los Angeles. Judge Anthony J. Mohr cited The Unruh Civil Rights Act when certifying the class.
Certification doesn’t imply wrong-doing, but simply allows the case to proceed as a class action suit.
The Unruh Act makes it illegal to deny, aid or incite a denial, or make any discrimination or distinction on the basis of, among other things, race, color or national origin. This includes the failure or refusal to provide all persons with full and equal advantages and services in all business establishments. (Opal Jones, et. al v. Wells Fargo Bank, N.A., Wells Fargo Home Mortgage, et. al Los Angeles Superior Court, Case No. BC337821).
The suit charges that Wells Fargo consistently and knowingly discriminated against borrowers in minority neighborhoods, resulting in these borrowers paying more for their loans than borrowers in other parts of Los Angeles County. According to the class action filing, Wells Fargo introduced a computer program in 2002 called “Loan Economics” that gave loan officers the ability to offer discounts to loan applicants that lowered overall loan costs through reduced fees and interest rates.
“Well Fargo allowed some bank branches to use the program to price loans, and at the same time prevented other bank branches from doing so,” said attorney A. Barry Cappello, managing partner of the Santa Barbara law firm of Cappello & Noël, which is representing the class. “The branches that were prevented from using the program were in predominately minority communities. Those branches that could use the program were in predominately white communities.”