Baltimore Finally Gets Green Light To Continue Against Alleged "Ghetto Loans" Peddler In Reverse Redlining Suit; Ruling May Help Similar Memphis Case

In Memphis, Tennessee, The Memphis Daily News reports:

• The city of Baltimore’s mortgage discrimination lawsuit it filed three years ago against San Francisco-based Wells Fargo can go forward now that it has survived Wells’ motion to dismiss the case. The federal judge presiding over the case published an opinion Friday that gave the green light to Baltimore’s fourth iteration of its suit.(1)
• The suit claims Wells pushed black borrowers into high-cost subprime loans and targeted homeowners for burdensome refinance and home equity loans.
• The same day that opinion was published, meanwhile, lawyers representing Memphis and Shelby County government filed a copy of it in federal court in Memphis to make U.S. District Judge S. Thomas Anderson aware of the news.
• They believe the Baltimore decision bolsters the same thing they’re trying to prove here. On substance, there’s barely any daylight between the two lawsuits. Both allege similar claims against Wells and frame their arguments in nearly identical ways.(2)
• The lawsuit on behalf of Memphis and Shelby County governments even relies on lawyers from the same Washington-based firm of Relman, Dane & Colfax PLLC.

For more, see Baltimore Wells Fargo Ruling Helps Local Cause.

(1) Baltimore's earlier complaints included testimony from two former high-ranking Wells Fargo employees stating that Wells Fargo intentionally made bad loans to African-Americans. The employees, who worked out of Virginia and Maryland but knowledgeable about the company's national lending practices, according to the complaints, said Wells Fargo marketed subprime loans to predominantly African-American ZIP codes and churches, used software to "translate" marketing materials into African-American vernacular, and that company officials referred to the loans in minority communities as "ghetto loans" and to borrowers as "mud people." See The Daily Record: Ex-workers allege race-based loan approach at Wells Fargo.

(2) Go here to read more about the Baltimore case, and here to read more about the Memphis case, and here for earlier posts on the "ghetto loans" allegations made against Wells Fargo.