City Of Baltimore To Target Wells Fargo In Federal Race Bias Suit Alleging Discriminatory Predatory Lending

In Baltimore, Maryland, The Baltimore Sun reports:

• In a potentially groundbreaking lawsuit intended to stem foreclosures in Baltimore, Mayor Sheila Dixon's administration is suing a leading mortgage provider for what the city says has been a pattern of predatory lending in black neighborhoods. The lawsuit, which the Dixon administration plans to file today in U.S. District Court, alleges that California-based Wells Fargo Bank sold higher-interest subprime mortgages to blacks more frequently than to whites and that the practice, known as reverse redlining, violates federal housing law. Lenders are increasingly coming under legal attack from borrowers and investors stung by the subprime mortgage crisis, but Baltimore's lawsuit could be the first in the nation in which a city is attempting to recapture costs associated with foreclosed homes that wind up vacant.

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• "They knew that the minority community was so desperate to get loans because they had been denied credit for so long," said John Relman, a partner at the Washington law firm Relman & Dane, which the city hired to help litigate the case. "They knew that people were so ready to say yes to anything that they went in there and charged them higher rates."

For more, see Lawsuit by city targets lender (Subprime mortgages unfairly marketed to blacks, it alleges).

See also:

• Baltimore Is Suing Bank Over Foreclosure Crisis (The New York Times),
• Baltimore lawsuit will accuse bank of predatory lending practices (The Associated Press),
• City sues Wells Fargo (Examiner.com).

To view the lawsuit, see Mayor and City Council of Baltimore v. Wells Fargo Bank, N.A., et al. (8.76 MB).

Representing the City Of Baltimore is the Washington, D.C. law firm Relman & Dane.

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