The U.S. Department of Housing and Urban Development said Oct. 7 that Secretary Scott Turner launched an investigation into Wells Fargo's initiatives to increase homeownership for Black Americans. HUD says the programs may violate the Fair Housing Act.
According to a Wall Street Journal report that HUD reposted, HUD sent Wells Fargo CEO Charlie Scharf a letter saying it would examine whether the bank violated fair-lending laws by favoring Black or other minority homeowners. The programs and commitments in question stretch over nearly a decade. The Journal reported that Wells Fargo had no immediate comment.
HUD Assistant Secretary Craig Trainor said the Fair Housing Act forbids racial discrimination in housing and that labeling a practice a special purpose credit program does not exempt it. Secretary Turner said that even if the bank did not break the law, the practice was wrong. Those are HUD's statements, and HUD has not announced any finding.
An investigation is not a finding of a violation. HUD's page does not name any penalty, and it does not say how long the review will take. Borrowers with Wells Fargo mortgages are not told to do anything under the announcement.