Ellis George Cipollone files lawsuit against wells Fargo for discriminatory home lending practices

Ellis George Cipollone O’Brien Annaguey LLP has filed a complaint on behalf of an individual plaintiff and a class action against Wells Fargo Bank, N.A. and Wells Fargo Home Mortgage (collectively “Defendants” or “Wells Fargo”), alleging racial discrimination towards Black applicants for home mortgage refinancing through the bank’s Home Mortgage lender service.

“The disproportionate number of Black applicants that were denied refinancing by Wells Fargo is staggering, especially when compared with those who were approved by other banks,” said Dennis Ellis, lead counsel for the individual plaintiff and the proposed class.

The complaint alleges that the Defendants have continued to discriminate against Black American home loan applicants despite the nation’s recent efforts to rectify the historically unfavorable conditions preventing Black Americans from achieving full rights to financial benefits for U.S. citizens, such as home ownership.

Some of the discriminatory practices include the ongoing, modern-day “redlining” or refusal to insure mortgages in and near Black neighborhoods, delay and/or denial to refinance loans at lower interest rates for Black homeowners, and the high rate of rejection of credit applications from qualified Black Americans through automated algorithms and machine learning systems. A recent study found that Wells Fargo approved only 47% of Black applicants for refinancing, where all other banks on average approved 71% of Black applicants. Hence, the unfair acts by Wells Fargo, one of the top lenders in the country, has forced Black homeowners to pay more than non-Black homeowners, resulting in foreclosure in many cases, alleges the lawsuit.

“Reflecting its sordid history of racial bias, Wells Fargo reached this disproportionate level purposefully,” Ellis added. “It did so through its brazen use of multiple intentionally discriminatory algorithms and other race-driven lending practices, the disparate impact of which it either promoted or chose to ignore.”

One of such victims and an individual plaintiff named in the case is Aaron Braxton, a Black playwright, performer, and a math and science teacher with a Master’s degree from the University of Southern California, who purchased his home in 2000 in the South Los Angeles area with a Wells Fargo home mortgage insured by the Federal Housing Administration.

Braxton experienced impediments by Wells Fargo in seeking to refinance his home, including processing times not experienced by non-Black applicants, enrollment in an unsolicited debt-trap deferred payment program without Braxton’s consent, and denial of his full request, finally granting him an above-market interest rate nearly a year and a half later.

The counts against the Defendants include the violation of the Equal Credit Opportunity Act, race discrimination in violation of the Fair Housing Act of 1968, and violation of the Unruh Civil Rights Act, among others.

The case is being filed in the United States District Court for the Northern District of California. The Court has federal question jurisdiction over this matter due to the question and issue of federal law and civil rights causes of action.

This article was shared with Prittle Prattle News as a Press Release.
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