The Department of Housing and Urban Development is planning to investigate Wells Fargo's compliance with fair-lending laws, sending a letter to CEO Charlie Scharf stating it would examine allegations that the bank favored Black and other minority homeowners. The scrutiny stems from Wells Fargo's nearly decade-long effort to address the homeownership gap among Black Americans, including a 2017 commitment of $60 billion in loans to help add at least 250,000 Black homeowners by 2027 and a 2022 expansion to refinance minority-owned homes using its own funds. By late 2023, the bank had fulfilled about 40% of its original lending commitment and helped refinance roughly 5,100 customers. HUD alleges Wells Fargo adopted a strategy of sorting homeowners and offering different products or terms based on race, and HUD Secretary Scott Turner said the agency plans a full review of the bank's statements and practices, with the review also covering similar initiatives at other banks. The probe lands after Wells Fargo terminated 14 consent orders since 2019, saw the Federal Reserve lift its nearly seven-year asset cap in June 2025 and close its 2018 governance and risk-management enforcement action in March 2026, and received an upgrade of its long-term issuer credit rating to A- from BBB+ with a stable outlook from S&P Global Ratings last month. Wells Fargo shares lost 1.5% in yesterday's trading session and have fallen 6.6% over the past six months against the industry's growth of 4.8%.
Wells Fargo & CompanyHUD opens a fair-lending compliance probe into Wells Fargo's minority homeowner program, creating legal/regulatory risk.
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