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HSBC is cutting back in the U.S. after its 2003 purchase of Household International Inc. required it to set aside more than $65 billion for bad loans

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New lawsuit alleges HSBC systematic institutionalized racism

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.

Posted By Timothy Blake

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UPDATE NOTE: HSBC car loans were sold to Santander USA in 2010 :: Most HSBC credit cards became Capital One credit cards in 2012 :: HSBC horrible predatory home mortgages are in run-off