5 Major Lending Institutions That Paid Millions For Discriminating, Taking Advantage of Black People

Wells Fargo A government investigation uncovered 34,000 cases where Wells Fargo charged Black and Hispanic borrowers higher fees and rates on mortgages compared to their white counterparts, forcing the bank to pay out $175 million in 2012. The investigation, which looked at mortgages made from 2004 to 2009, also revealed that Black and Hispanic homeowners were given more expensive mortgages and when they could not keep up with payments, the banks refused to refinance mortgages on terms equal to white borrowers. In 4,000 out of the 34,000 cases, minority borrowers, some who qualified for cheaper loans, were steered into subprime mortgages. M&T Bank In 2015, M&T Bank, the nation's 17th-largest bank, came under fire for discriminating against Black, Hispanic and Asian borrowers by giving white borrowers with lesser qualifications higher loan amounts. The 2015 lawsuit claimed the bank steered home buyers to a particular neighborhood based on their race or ethnicity, and the suit also accused the bank of violating the landmark Fair Housing Act of 1968, which sought to put an end to housing segregation. M&T Bank's New York City employees could be heard and seen giving special treatment to white prospective borrowers, according to the suit. From 2012 to 2014, the Fair Housing Justice Center sent out several actors to test whether or not the bank discriminated against people of color. In one occurrence, a Black candidate was denied a loan because a loan officer told her she did not have enough savings. But a white actor posing as a borrower with a slightly lower income, lower credit scores and $9,000 less in savings was pre-approved for a loan. JPMorgan Chase The U.S. government filed a lawsuit Wednesday, Jan. 18 that claimed JPMorgan Chase discriminated against "thousands" of Black and Hispanic mortgage borrowers from 2006 to 2009. According to the lawsuit, the average Black and Hispanic home buyer paid an estimated $1,000 more than their similarly situated white peers. In total, the discrimination cost nearly 53, 000 borrowers "tens of millions of dollars in damages," the government said. The average Black borrower paid about $1,126 more over the first five years on a loan of $191,100. JPMorgan Chase settled for $55 million, reported Atlanta Black Star. Countrywide Financial Countrywide Financial paid out a $335 million settlement in 2011 after the U.S. Department of Justice conducted an investigation that revealed that loan officers took advantage of nonwhite borrowers. The high-profile investigation concluded that more than 200,000 nonwhite borrowers across the country were victims of discriminatory mortgage lending practices from 2004 to 2008. Countrywide also steered nearly 10,000 nonwhite borrowers into expensive subprime mortgages, while white borrowers with similar credentials received regular loans. Former U.S. Attorney General Eric Holder said in 2011 that "the settlement provides $335 million in compensation to victims of Countrywide's discrimination during a period when Countrywide served as one of the nation's largest single-family mortgage lenders and originated more than 4 million residential mortgage loans." When Bank of America acquired the bank in 2011, the settlement ultimately failed on their shoulders. Fifth Third Bank A U.S. Department of Justice and the Consumer Financial Protection investigation uncovered that Ohio-based Fifth Third Bank has been charging Black and Latino borrowers more interest on auto loans. Fifth Third Bank paid out $18 million to customers in 2015. Many of the complaints stemmed from the bank allowing car dealers to raise interest rates as they saw fit. Dealerships charged Black and Latino customers $200 more compared to white customers over the course of their auto loans. The investigation also revealed that dealers charged nonwhite customers as much as 2.5 percent more than the bank's normal rate, or buy rate, for car loans.

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