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March 13th, 2009
03:05 PM ET

NAACP alleges lending discrimination against Wells, HSBC

CNNMoney.com
Dow Jones

Wells Fargo Corp. (WFC) and HSBC Holdings PLC (HBC) are the target of separate lawsuits being filed on Friday by the NAACP, which alleges the banks were engaged in "systematic, institutionalized racism" in their subprime mortgage lending businesses.

The lawsuits, which the NAACP said would be filed in U.S. District Court in California, allege that African-American homeowners were frequently steered into mortgages with higher interest rates than other borrowers with similar credit histories.

"These banks are getting billions in bailout money yet think they can get away with business as usual," Austin Tighe, co-lead counsel for the NAACP, said in an interview Thursday evening.

Predatory lending and other practices, he continued, "are legally actionable and more importantly, morally reprehensible."

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Filed under: Bailout Turmoil • Economy • NAACP
soundoff (16 Responses)
  1. Blaq Ace

    You should have not used the car analogy as an example. More money is made at a car dealership on women and minorities than any other customer. Have buddy who owns ACURA store.

    March 14, 2009 at 1:22 pm |
  2. Ron T from Northport and NYC

    I got my mortgage at a great rate because I have great credit because I pay my bills (on time), I don't bounce checks, paid off old loans (college tuition, etc.) . and guess what? I read the contract to make sure my rate was what they told me it was going to be. People have to stop blaming everyone else for their problems and look in the mirror. Life's tough, get a helmet.

    March 14, 2009 at 8:10 am |
  3. lampe

    I'm sorry, but the NAACP can't have it both ways. They wanted these banks to loan money to people for homes, knowing full well some of them wouldn't be able to get homes otherwise. Now, they want to sue the same banks for giving higher rate loans, to people. Which way is it? Usally people without much credit, or people getting loans for their first homes are charged higher mortage rates and fees.

    March 13, 2009 at 7:59 pm |
  4. GiantsFan102897

    I really hope this case goes to trial. And WHEN (not it) these banks prove the NAACP's allegations to be completely unfounded, the NAACP should be forced to pay court fees and penalties. Then, the NAACP should be forced to hold a press conference in Washington, where the publicly apologize.

    Once and for all, this blame-whitey nonsense needs to stop. The race card has been played over and over and over to the point of nausea.
    What's really unfortunate is that I truly believe that racism still does exist, and that black people don't have a fair shot. But when fools like Sharpton, Jackson and Maxine Waters keep playing the race card, we have less and less interest in its viability. Sorry, but "wolf "has been cried too often. NO ONE IS LISTENING ANYMORE.

    March 13, 2009 at 7:39 pm |
  5. Mike, Zephyrhills, FL

    In some states the loans were sold and re-sold so many times, they forgot to pay the property taxes and the State got them and sold them, the loan was void and the bank lost it all. Kinda funny!!

    March 13, 2009 at 7:00 pm |
  6. Mike, Zephyrhills, FL

    The reselling of debt and loans should also be stopped!! They wouldnt be so fast to loan it out if they knew they couldnt profit from it and no have it on their books!!

    March 13, 2009 at 6:58 pm |
  7. Mike, Zephyrhills, FL

    They did, used to have RED LINES, they did and easy to prove. Many whites also in that crowd. SEC Rules and others also make statements about olans and investing. Therefore they are guilty !!

    Id ask for 15 trillion dollars!! and any more TARP money we give out

    March 13, 2009 at 6:55 pm |
  8. Annie Kate

    Any bank receiving a government bailout should be held to the strictest interpretation of the law since they are using taxpayer's money. Discrimination in lending based on race should not happen whether the bank got bailout money or not but it especially shouldn't happen with banks the American taxpayer is shoring up with their tax dollars.

    March 13, 2009 at 5:59 pm |
  9. Bill

    Most of the caucasions in the nation are sick of listening to the NAACP, ACLU, Sharpton, Jackson, Barber, and a host of other African Americans constantly complaining and blaming everyone and everything but themselves. They are already able to do things that caucasions cannot do such as refer to white ethnic backgrounds with derogatory comments. They are able to harass whites in stores by stepping to the front of lines, walking exxxtremly slowly in front of cars in parking lots of crossing streets if a white person is driving, wreckless driving to attempt to create an accident.

    They could quit wining and try working in the society as cooperative members. With a little homework and some basic knowledge of what they can afford, this could be avoided. I have had banks try to tell me I could afford homes in the past that I knew would take up every nickel we had leaving nothing for living. That was my responsibility, not someone else. Because a bank or any other business pushes, it does not mean you cannot push back. Take responsibility for your actions.

    March 13, 2009 at 3:14 pm |
  10. Mike in NYC

    This song is getting seriously old, just like the NAACP and their whining.

    "Similar" credit histories. Uh, huh. No doubt some crucial details are being omitted here, like lack of sufficient assets, child support obligations, etc.

    I can't wait until the housing market starts to come back. With more stringent lending requirements (hopefully), along with reduced availability of capital due to stricter regulation of mortgage-backed securities, the old favorite "You Be Redlinin' " will be hitting the charts again.

    March 13, 2009 at 2:50 pm |
  11. Michael D Goins

    Gee Wiz Is there still a NAACP...I thought they retired. They just smell money in this for themselves or just grandstanding. Im Black and do Business with wells Fargo and on my second home financed by them min 15 yrs. I Always got best rate.
    In Fact on my current home I got 30 yr fixed
    at 5.75 three years ago. In fact two weeks before closing the best rate was 6.25 30 yr and fixed was 6.50 30 yr. The day before closing the rates flipped and fixed dropped to 5.75 and I was notified and did rate lock. Folks just making excuses running round signing contracts that they do not know the meaning of cause thier eyes are bigger than thier walletts. I was preapproved by Wells for 250 thousand and only purchased a 190 thousand home. Whos laughing now? And I dont even have a four year degree. My hood is full with only 2 rentals last sale was in Jan 09 for 180k and it aint even brick like mine. Folks just greedy and materielistic. Should have purchased something they could afford and improve the land instead of buying what they cannot afford and leaving it worse than they found it. Thats the problem with the USA today everybody more interested in what it looks like they have instead of what they really have or can be charitable towards others in need with. It has iand will continue to be the reason for our decline..If OBAMA fixes this quick no lessons will be learned. If he doesent those of us that already knew will suffer needlessly.

    March 13, 2009 at 2:40 pm |
  12. Chris

    This is such bull, I am so tried of people wanting to cry racism ever five minutes. I have dealt with many banks, there all the same, get the most out of anyone of ANY color, black, white or other.

    Guess what, car dealerships do the same thing.

    No one made ANYONE sign a contact, so why is it they want to complain and yell "it's racist" when they themselves, of equal intelligence and freedom of choice decided to sign it THEMSELVES?

    Does that mean if I sign a contract on a car and then find out someone else get a better deal I should run and yells it's racist? That I'm being discriminated against? You had a NAACP member on there from Wisconsin I believe who said she bought a house, and at signing found the interest was at 11%, and STILL decided to sign it, then wants to go and proclaim to be a victim? Please tell me how that can possibly, in any reality be even close to feasible.

    If everyone is equal and equality is demanded, it has to go both ways and abusing it, much like the boy who cried wolf, kind of kills any credibility you proclaim to want.

    March 13, 2009 at 2:24 pm |
  13. Baze

    Whatever. When the heck are black people going to look at themselves for improvement instead of blaming everyone else?

    March 13, 2009 at 12:42 pm |
  14. David Welts

    If this is true, they have been responsible for much of the crumbling of the housing market in inner city neighborhoods where people have just walked away from thousands and thousands of homes. This has led to a plethora of many, many other problems.

    March 13, 2009 at 11:54 am |
  15. Michael "C" Lorton, Virginia

    When money talks---the truth often remains hidden--best of luck.

    March 13, 2009 at 11:42 am |
  16. Cindy

    Many, many, many banks lend money to minorities at a higher interest rate so why is the NAACP just going after these few banks? If they really want to do something about it why not go to where the laws are made and get things changed that way. Suing one or two banks won't change how every other bank works.

    Cindy...Ga.

    March 13, 2009 at 11:35 am |