One of America’s biggest banks is now the target of a federal fair housing investigation, and the Trump administration says it may not stop with Wells Fargo.
On Wednesday, Housing and Urban Development Secretary Scott Turner announced that HUD is investigating the bank’s programs aimed at boosting homeownership among Black Americans. The agency says those programs may violate the Fair Housing Act.
The investigation was opened through a letter to Wells Fargo CEO Charlie Scharf. It was signed by Craig Trainor, the assistant secretary who leads HUD’s Office of Fair Housing and Equal Opportunity.
Trainor wrote that he had directed the Office of Special Investigations to look into the bank in response to its repeated public promotion of explicit race-based lending policies.
HUD’s letter points to marketing campaigns, lending programs, and public outreach that targeted Black homeownership. It traces the concern back to 2017, when the bank publicly committed $60 billion in lending with a goal of creating at least 250,000 Black homeowners by 2027.
The agency alleges the bank engaged in a strategy of “sorting” homeowners and offering different products or terms based on race. HUD says it is examining whether that amounts to implementing a racialized home loan policy.
Turner did not soften his language. He said that even if Wells Fargo did not violate the law, its practice of dividing Americans based on race is immoral, unethical and un-American.
He went further and said Wells Fargo and every employee who engaged in race-based decision-making should be ashamed of themselves.
Deputy Secretary Andrew Hughes added that the Trump administration will not stand for un-American and unlawful race-based mortgage lending by any financial institution. He called the probe another important step in restoring justice to fair housing enforcement.
The legal question at the center of the case is a serious one. The Fair Housing Act flatly bars consideration of race in real estate transactions, and critics of race-conscious lending say that no program should be allowed to treat applicants differently because of skin color.
