Wells Fargo Class Action Alleges Discrimination in Loan Approvals

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A class action lawsuit filed on Jan. 30 against Wells Fargo alleges that the bank discriminates against non-citizens when it approves loans, in violation of federal and California law.

Wells Fargo “outright refuses to extend loans to individuals who are not U.S. citizens or permanent residents,” the complaint asserts.

According to the lawsuit, the Civil Rights Act of 1866 prohibits such discrimination against aliens, as do California’s unfair competition laws.

Plaintiff Mitzie Perez is a California resident and third-year undergraduate student at the University of California, Riverside. Perez states that she is authorized to live and study in the U.S. under the Deferred Action for Childhood Arrivals (DACA).

According to the complaint, in June of 2012 President Obama declared that the Department of Homeland Security would grant “deferred action” to young people raised as Americans.

In addition, DACA allows those granted “deferred action” to obtain an Employment Authorization Document (EAD), also known as a federal work permit, and a Social Security Number. Perez is a DACA recipient with an EAD, the class action asserts.

The Wells Fargo discrimination loan approval class action lawsuit contends that “those granted deferred action and in possession of an EAD are legally authorized to work in the United States, and can prove their identity.”

More importantly, “There is no federal or state law or regulation that restricts banks from providing financial products to customers because the customer is an alien.”

Because people such as Perez have Social Security Numbers, the complaint argues, banks such as Wells Fargo can open accounts and provide loans to them under federal regulations.

However, Perez claims that in August of 2016 she applied for a student loan from Wells Fargo online. She was denied based on the limited information she provided to the company, which included her non-citizen status.

When she tested the approval process by changing her status to “permanent resident alien” Perez says she was approved for the loan. Therefore, Perez argues, Wells Fargo denied her loan simply based on the fact that she is neither a U.S. Citizen nor a permanent resident alien.

That policy of discrimination by Wells Fargo is illegal, according to the class action. The complaint asserts that this policy “constitutes unlawful alienage discrimination in the making and enforcing of contracts” in violation of federal law.

Separately, Wells Fargo intentionally discriminated against Perez on the basis of her immigration status in violation of California law, the class action contends.

The discrimination lawsuit requests certification of a Class of “All persons within the jurisdiction of the United States who were denied the right to contract for a loan or other financial product by Wells Fargo because they were not U.S. citizens despite satisfying Wells Fargo’s CIP requirements between January 30, 2013 and the date of judgment in this action.”

The class action seeks damages, including statutory and punitive damages, as well as an injunction stopping Wells Fargo from engaging in its discriminatory practices.

Perez is represented by Jahan C. Sagafi, Katrina Eiland, Adam T. Klein, Ossai Miazad, Michael N. Litrownik, Olivia J. Quinto, and Patrick David Lopez of Outten & Golden LLP, and Thomas A. Saenz and Victor Viramontes of the Mexican American Legal Defense and Educational Fund.

The Wells Fargo Loan Discrimination Class Action Lawsuit is Mitzie Perez, et al. v. Wells Fargo & Co., et al., Case No. 3:17-cv-00454, in the U.S. District Court for the Northern District of California, San Francisco Division.