Wells Fargo Class Actions Allege Racial Discrimination

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Wells Fargo Racial Discrimination Class Action Lawsuits Overview: 

• Who: Ifeoma Ebo and Aaron Braxton filed separate class action lawsuits against Wells Fargo Bank, N.A.
• Why: Ebo and Braxton separately claim Wells Fargo discriminates against Black Americans who are applying for home mortgage loans and refinancing with the bank.
• Where: The class action lawsuits were filed in California and New York federal court.

Wells Fargo Bank places Black Americans applying for home mortgage loans and refinancing at a competitive disadvantage, a pair of new class action lawsuits separately allege.

Plaintiff Ifeoma Ebo cited a recent Bloomberg report that he says revealed Wells Fargo was the only bank in the country to reject more Black American applicants than it accepted in 2020.

Further, Ebo claims the report showed Wells Fargo approved fewer than half of all homeowners’ refinancing applications filed by Black Americans that year.

Ebo also argues that even when Wells Fargo does approve a Black American’s applicant, that the bank proceeds to offer them interest rates that are “significantly less favorable” than what is offered to white Americans.

“Wells Fargo’s discriminatory practices are also pervasive with respect to applicants for new mortgage loans,” Ebo’s class action lawsuit states. 

Beyond accepting Black American applicants at a lower rate, Ebo argues Wells Fargo makes the process itself more difficult by requiring them to submit documentation beyond what is necessary or more than once.

Ebo wants to represent a nationwide class of Black Americans who submitted an application with Wells Fargo to obtain or refinance a mortgage loan meant for a residential retail property and whose applications were never completed or denied despite being qualified to be approved. 

He is demanding a jury trial and requesting actual, statutory and punitive damages for himself and all class members.

Wells Fargo’s Discrimination Forces Black Homeowners To Pay More Than Other Homeowners, Plaintiff Says

The second plaintiff, Aaron Braxton, a Black playwright, meanwhile, says Wells Fargo’s decision to reject Black applicants at a higher rate forces Black homeowners to end up having to pay more than other homeowners, which often ends up in foreclosure

According to Braxton, a recent study shows Wells Fargo only accepts 47% of Black applicants who are attempting to refinance, which is lower than the national approval average of 71% for Black Americans.

Braxton claims Wells Fargo put roadblocks in his way when he applied to refinance his home with the bank, including subjecting him to unusually long processing times and enrolling him in a deferred payment program he called a “debt trap” and which he says he never consented to joining. 

Wells Fargo eventually granted Braxton an above-market interest rate almost a year and a half after he first applied to refinance, he says. 

Ebo and Braxton collectively claim Wells Fargo is in violation of, among other things, the Equal Credit Opportunity Act, the Fair Housing Act of 1968 and the Unruh Civil Rights Act. 

Final approval was given in December for a $28 million class action settlement agreement made by Wells Fargo to resolve claims telemarketing merchants hired by the bank recorded consumers during sales calls without their consent. 

Have you been discriminated against when applying for a home loan with Wells Fargo? Let us know in the comments! 

The plaintiffs are collectively represented by Javier L. Merino, Marc E. Dann and Brian D. Flick of DannLaw; Thomas A. Zimmerman Jr. of Zimmerman Law Offices, P.C.; and Ellis George Cipollone O’Brien Annaguey LLP. 

The Class Action Lawsuits are Ebo v. Wells Fargo Bank, N.A., Case No. 1:22-cv-01922, in the U.S. District Court for the Eastern District of New York and Braxton v. Wells Fargo Bank, N.A., Case No. 4:22-cv-01748, in the U.S. District Court for the Northern District of California.

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