Wells Fargo & Co are among the largest banks in the United States. But the bank has been dragged through series of scandals involving their employees with the recent one being accused of using redlining in its extensions of loans.
The city of Philadelphia recently filed a case against the Wells Fargo bank accusing it of using discriminatory lending policies targeting the minorities seeking mortgage.
Though the bank has termed the allegations ‘baseless,’ the city of Phil has claimed that the Wells Fargo bank blackmailed the black and Hispanic loaners into taking loans with bigger risks coupled with insane interests.
The city went ahead to state that, although most of these minority borrowers qualified for credit and lower interest rates, the bank still gave them higher making it harder for them to service their mortgage hence leading to foreclosures.
Through their research, the city established that the blacks were more likely to get loans with higher interests as compared to the whites borrowers who received low-interest loans. While the Hispanics received high-risk mortgages.
The City added that the minority makes almost three-quarter of its total population, meaning the cats of the bank is curtailing the growth of City by lowering the value of its properties, increasing crime rates and also increasing rates of damage of assets.
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The City of Phil is demanding compensation of unnamed amount of money for the losses and the court to order the bank to stop redlining practices, especially on racial basis.
This is not the first lawsuit filed against the bank; it has also been sued for using fake customers’ names to create bank accounts to achieve their sales goals not forgetting that Miami’s lawsuit against the bank is also brewing.
About Karl Heideck
Karl Heideck is a graduate of bachelor’s degree in arts from the Swarthmore College in 2003 as well as Juris Doctor from James Beasley School of Law based at Temple University where he graduated in 2009.
After graduating Karl Heideck started his career as an attorney, where has vast experience with pretrial, post – trial and other litigations fields. Karl Heideck has worked with Conrad O’Brien and Pepper Hamilton LLP.