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Consumer advocacy groups donned in shark uniforms protested alleged predatory lending practices at Wells Fargo outside its annual shareholder meeting Tuesday. Attendees of the annual meeting in San Francisco were greeted by picketers wearing shark costumes, carrying inflatable sharks and handing out multi-colored gummy sharks, according to announcements by organizers Responsible Wealth and the Association of Community Organizations for Reform Now. The groups organized the Stop the Loan Sharks! demonstration to protest alleged racial disparities in the cost of Wells Fargo home loans. After the rally, 18 of the protestors were scheduled to enter the meeting using proxies donated by Responsible Wealth to present a resolution in the meeting asking Wells to explain why it charges African-American and Latino borrowers higher interest rates than whites, ACORN said.
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“As an owner of Wells Fargo, I want to know that the profits I make from this business do not come at the cost of increasing the racial wealth divide or preventing hard-working people from climbing up the ladder of success,” said Marnie Thompson, a shareholder, customer and Responsible Wealth member, in a written statement.
Around the time the consumer groups started their national campaign against Wells’ predatory practices three years ago, the chief of the company’s subprime unit resigned from his position. Subsequent protests and presentations at annual meetings complemented a lawsuit filed by ACORN accusing the company of not informing borrowers they qualified for a better rate, among other allegations.
Over the three-year period, Wells has changed certain lending policies such as reducing prepayment penalties and eliminating mandatory arbitration, Responsible Wealth noted.
ACORN said its analysis of mostly conventional first-lien mortgages based on Home Mortgage Disclosure Act data from Wells found 30% of mortgage loans made to African-Americans and 13% of loans to Latinos were high-cost, compared to only 8% of loans to whites. In California alone, African-Americans who get a mortgage from Wells are 6 times more likely than whites to get charged a high rate and Latinos are almost 4 times more likely than whites to get a high rate, ACORN said.
Wells has fought back, stating at one time that ACORN’s public demonstrations and lawsuits were “deliberate attempts to distort and misrepresent our business practices and procedures.”
In an e-mailed statement Tuesday to MortgageDaily.com, Wells spokesman Jay Lawrence said, “Wells Fargo is driven by our commitment to fair and responsible lending.
“Race is not a factor in our pricing, and we market to individuals, not to neighborhoods. Our continued growth depends on serving all customers, especially the underserved. We have special loan products and outreach programs to help us achieve that. We want to help as many people as we can obtain financial success through homeownership.”
However, Responsible Wealth said that although Wells “claims they do not tolerate discrimination, they have also blocked attempts including investigations and consumer protection legislation to disclose more information. For instance, they led the pack in blocking Attorney General Spitzer’s request for voluntary disclosure of loan conditions and anonymous credit scores used to determine loan pricing conditions and anonymous credit scores used to determine loan pricing.”
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ACORN’s public demonstrations and lawsuits against Wells Fargo are “deliberate attempts to distort and misrepresent our business practices and procedures,” according to a company executive. The lender, which has been under increasing pressure by ACORN to change its lending practices, pointed to cases where it helped borrowers even as it was accused of harming them.
ACORN Continues Assault on Wells
More than 2000 rally participants will converge in Los Angeles today to protest alleged predatory practices by one of the country’s biggest mortgage lenders. The rally coincides with the planned filing of a nationwide lawsuit by consumer advocate group ACORN — which accuses the company of not informing borrowers they might qualify for a better rate.
Numerous members of a prominent anti-predatory lending organization will attend Wells Fargo & Co.’s annual shareholder meeting Tuesday to protest against alleged subprime predatory lending practices, and additionally propose a resolution to tie executives’ multimillion-dollar pay with their efforts to end such acts.
ACORN Sets Sites on Wells Fargo
A consumer advocacy group started a campaign Monday against financing giant Wells Fargo.
