Feds, Wells Fargo Reach $125M Deal To Settle 'Ghetto Loan' Peddling Allegations

From the U.S. Department of Justice:

• The Department of Justice [] filed the second largest fair lending settlement in the department’s history to resolve allegations that Wells Fargo Bank, the largest residential home mortgage originator in the United States, engaged in a pattern or practice of discrimination against qualified African-American and Hispanic borrowers in its mortgage lending from 2004 through 2009.
  
  The settlement provides $125 million in compensation for wholesale borrowers who were steered into subprime mortgages or who paid higher fees and rates than white borrowers because of their race or national origin. Wells Fargo will also provide $50 million in direct down payment assistance to borrowers in communities around the country where the department identified large numbers of discrimination victims and which were hard hit by the housing crisis.

For the Justice Department press release, see Justice Department Reaches Settlement with Wells Fargo Resulting in More Than $175 Million in Relief for Homeowners to Resolve Fair Lending Claims (African-American and Hispanic Borrowers Who Qualified for Loans and Were Charged Higher Fees or Rates or Were Improperly Placed into Subprime Loans Are Eligible for Compensation).

Go here for the consent order.