US banks accused of racist tendencies

Sun, 07 Jun 2009 17:57:49 GMT

http://www.presstv.com/detail.aspx?id=97371&sectionid=3510203

The testimonies by two ex-loans officers at US bank Wells Fargo, provide detailed accusations of intentional push of a black minority into subprimes.
US African-American community in Baltimore and suburban Maryland express anger as they realize they have been systematically pushed into sub-prime loans because of their race.

These loans pushed many African-American and Hispanic homeowners in the area into foreclosure and cost the Baltimore city tens of millions of dollars in taxes and city services as many houses are left vacant.

According to testimonies by two former loan officers at Wells Fargo Bank, the bank saw the African-American community as fertile ground for sub-prime mortgages, as working-class Afro-Americans were eager to be a part of the nation's home-owning mania.

The attorney generals of Illinois and New York have begun investigations about the lending practices of Wells Fargo, JPMorgan Chase and Citigroup, as well as some other banks.

Beth Jacobson, a loans officer at Wells Fargo said she and her fellow officers pushed customers who could have been eligible to receive prime mortgages into high-interest sub-prime loans.

"Wells Fargo mortgage had an emerging-markets unit that specifically targeted black churches, because it figured church leaders had a lot of influence and could convince congregants to take out sub-prime loans," she said.

The sworn testimonies by Ms. Jacobson and another other loans officer Tony Paschal, both of whom have left Wells Fargo, provide detailed accusations of intentional push of a racial minority into sub-primes.

In a recent analysis of mortgage lending in New York City, the New York Times realized that African-American customers making more than USD 68,000 a year were nearly five times as likely to receive sub-prime loans as whites of similar or even lower incomes.