Wells Fargo Corp. and HSBC Holdings PLC 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.
The two new lawsuits are related to a broader July 2007 lawsuit NAACP filed against some of the nation’s largest lenders for discriminatory lending practices. Tighe said the allegations against HSBC and Wells Fargo were being filed as a result of subsequent investigations and calls made to the NAACP.
He noted that a federal court denied a joint motion filed by the lenders to dismiss the 2007 lawsuit earlier this year, and said lawyers hoped to soon obtain internal company documents that contributed to the alleged discrimination.