Oct 7 (Reuters) – Wells Fargo is facing a potential investigation from the Trump administration’s housing authority over programs and commitments the bank made to increase homeownership among Black Americans, the Wall Street Journal reported on Wednesday.
The Journal cited a letter from the Department of Housing and Urban Development sent to Wells CEO Charlie Scharf on Wednesday. It will examine whether the bank violated fair-lending laws by favoring Black or other minority homeowners, the letter reportedly said.
Reuters could not independently verify the report. Wells Fargo, which is set to report third-quarter results next week, declined to comment. The Department of Housing did not immediately respond.
Wells Fargo has announced a series of measures over the years to increase lending to minority communities, including a 2017 commitment to lend $60 billion to help add at least 250,000 African American homeowners by 2027.
The department’s letter said Wells Fargo had adopted a strategy of “sorting” homeowners and offering different products or terms based on their race, according to the Journal.
Department of Housing Secretary Scott Turner plans a full investigation into Wells Fargo’s statements, the report said, citing a senior official. The agency, it added, is also reviewing similar initiatives by other banks.
The reported probe will add to the crackdown on diversity, equity and inclusion (DEI) policies at public and private organizations since President Donald Trump took office.
Trump signed an executive order earlier this year, asking federal contractors and their subcontractors to eliminate DEI practices, drawing a lawsuit from Democratic state officials.
(Reporting by Utkarsh Shetti in Bengaluru; Editing by Joyjeet Das)
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