Wells Fargo Bank and the City of Philadelphia have settled a 2017 lawsuit brought by the city over the bank’s alleged discriminatory lending practices with a $10 million check.
The funds from Wells Fargo will mainly be spent on down payment and closing cost assistance for homebuyers up to 120% of the area median income, or $97,320 for a family of three. City solicitor Marcel Pratt touted the settlement in an announcement of the collaboration agreement.
Philadelphia sued Wells Fargo for violating the Fair Housing Act, arguing that the bank targeted Black and Latinx neighborhoods with predatory loans in a process known as “reverse redlining,” where non-white borrowers are sold mortgages with exorbitant fees and interest rates. It was these same neighborhoods that had often been discriminated against in the 20th century, when they were denied access to capital for racist reasons.