Wells Fargo Says DOJ May Seek Penalties Over Fair Lending
Wells Fargo & Co. (WFC), the biggest U.S. mortgage company, said federal prosecutors may seek damages and penalties after investigating whether or not this violated anti- discrimination laws while financing homeowners.
“The Department of Justice has advised Wells Fargo it believes it can bring claims,” the financial institution said today inside a regulatory filing, without elaborating on potential allegations. “We believe such claims shouldn’t be brought and continue trying to demonstrate to the Department of Justice our compliance with fair-lending laws.”
Wells Fargo has faced government scrutiny of lending and foreclosures within the wake of the housing crisis because it expands a record 34 percent share from the U.S. mortgage market. The firm was negotiating using the Justice Department this past year to resolve a probe into whether or not this directed blacks to subprime loans, an individual familiar with the matter said in July. Additionally, it faces a U.S. overview of whether it neglected bank-owned homes in minority neighborhoods, an individual briefed on the case said in April.
Mary Eshet, a spokeswoman for the San Francisco-based company, declined to comment beyond today’s filing. Xochitl Hinojosa, a Justice Department spokeswoman, declined to comment.
Last year’s lending inquiry, conducted through the Justice Department’s Civil Rights Division, centered on the company’s actions throughout the housing bubble, the individual said at the time.