Federal Judge Again Boots Baltimore "Reverse Redlining" Suit Against Alleged Ghetto Loans Peddler; Extends Invitation To City For A 3rd Try

In Baltimore, Maryland, The Baltimore Sun reports:

• A complaint filed by the city alleging that Wells Fargo Bank is liable for lost property tax revenue because some houses that went into default were in poor condition was denied by a U.S. District Court judge Tuesday.

• Judge J. Frederick Motz dismissed the city's complaint, the second against the bank, alleging that vacant houses fell into disrepair as a result of Wells Fargo's steering residents toward more expensive subprime loans, causing them to default. However, he permitted the city to file a third amended complaint by the end of next month.

• Motz's opinion said the city should pursue the third complaint "if it can prove property-specific injuries inflicted upon it at properties that would not have been vacant but for the allegedly improper loans made by Wells Fargo."(1)

For more, see Judge denies city complaint tying Wells Fargo to blight (City says dishonest loans caused unnecessary foreclosures, loss of tax revenue) (if link expires, TRY HERE).

Go here for prior posts on the earlier "ghetto loans" allegations made against Wells Fargo.

(1) In the latest complaint, the city's attorneys reportedly focused on the alleged damages caused by more than 250 properties identified as blighted houses because of unnecessary foreclosures resulting from dishonest loans. Vermin, repeated visits by police and firefighters, and sometimes up to a half-dozen visits by housing code inspectors per year are recorded for most houses listed, the story states. The city's complaint reportedly also included declarations from 11 homeowners who live next to Wells Fargo foreclosure properties, contending that the vacant houses have led to additional problems, such as fires set by squatters, pit bulls running wild in yards and one case of a cockroach from a vacant house becoming lodged in a child's ear.