Plaintiffs v Wells Fargo Bank
Judge Certifies Lending Discrimination Class Action Against Wells Fargo Bank
A Los Angeles Superior Court judge certified a lending discrimination class action against Wells Fargo Bank. The class action was brought against the lender on behalf of loan customers in minority communities in Los Angeles. Judge Anthony J. Mohr cited The Unruh Civil Rights Act when certifying the class. The Unruh Act makes it illegal to deny, aid or incite a denial, or make any discrimination or distinction on the basis of, among other things, race, color or national origin. This includes the failure or refusal to provide all persons with full and equal advantages and services in all business establishments. (Opal Jones, et. al v. Wells Fargo Bank, N.A., Wells Fargo Home Mortgage, et. al Los Angeles Superior Court, Case No. BC337821).
The suit charges that Wells Fargo consistently and knowingly discriminated against borrowers in minority neighborhoods, resulting in these borrowers paying more for their loans than borrowers in other parts of Los Angeles County. According to the class action filing, Wells Fargo introduced a computer program in 2002 called "Loan Economics" which gave loan officers the ability to offer discounts to loan applicants that lowered overall loan costs through reduced fees and interest rates.
According to the action, Well Fargo allowed some bank branches to use the Program to price loans, and at the same time prevented other bank branches from doing so. Moreover, the suit charges that branches that were prevented from using the Program were in predominately minority communities, while those branches that could use the program were in predominately white communities.
"Through discovery, we learned that the cost of a Wells Fargo home loan was predicated in part on where the bank branch was located," says attorney Leila J. Noel, also a partner at Cappello & Noel. "Wells Fargo loan officers in minority communities asked to use the Loan Economics Program because they knew they then could pass discounts on to their customers, but they repeatedly were rebuffed by upper management. We believe thousands of minority Wells Fargo borrowers unwittingly were put into higher-cost loans because of the lender's discriminatory practices," says Noel.
As representatives of the class, the plaintiffs are seeking statutory damages in the amount of $4,000 per loan. Class members must wave their right to actual damages. Plaintiffs in the action estimate that there may be more than 10,000 borrowers that would qualify as class members.
Class members are defined as borrowers who obtained a first trust deed-secured loan from Wells Fargo Bank or Wells Fargo Home Mortgage for more than $150,000 between May 2002 and December 2005. Members must have applied for their loans at Wells Fargo branches located within specific areas of Los Angeles County.
Notice to potential class members will be forthcoming upon approval of the form of notice by the court.
For more information please contact:
A. Barry Cappello
Leila J. Noel
Cappello & Noel LLP
805-564-2444
abc@cappellonoel.com
Diane Rumbaugh
Rumbaugh Public Relations
805-493-2877
diane@rumbaughpublicrelations.com
