The NAACP filed a lawsuit Friday against Wells
Fargo and HSBC and their subsidiaries, charging that lenders steered
blacks into higher-price loans than their white counterparts, even with
similar incomes and credit scores.
    The suit specifically names Wells Fargo Bank and Wells Fargo Home
Mortgage Inc. (owned by Wells Fargo & Co.), HSBC Mortgage
Corp. (USA), and HSBC Bank USA (owned by HSBC Holdings).
    The Center for Responsible Lending reported that
African Americans were 31% to 34% more likely to receive a
higher-rate loan than whites, when they could have qualified
for lower interest loans.
    The lawsuits don't seek financial damages. Instead
they ask the court to force lenders to prove they have policies in
place to ensure that borrowers with similar qualifications get access
to the same loans regardless of race.
    Benjamin Todd Jealous, the NAACP's president,
stressed the fact that African Americans are more likely to get
subprime mortgages designed for borrowers with low incomes and
risky credit. Black consumers typically pay 2.3 percentage points
more in interests than whites. For prime loans, reserved for those
with low credit risks, blacks still pay more 1.3 percentage points
more in interest on average. Todd added that these lenders
have established businesses in predominately
minority areas because they were underserved by mainstream banks. 
    "The consumers trusted them, because for generations banks and
financial institutions had been considered worthy of trust,he said.
     A Wells Fargo said in a statement that the litigation
was unfounded. The company went on to state that it has been
working with the NAACP for the past two years to develop a
partnership that  would benefit the NAACP, its constituents,
and our communities. The statement concluded, We are dismayed
that the NAACP has chosen to abandon that constructive dialogue
in order to pursue this litigation.
   HSBC, said in its statement that it "stands by its
fair lending and consumer protection practices" and is "confident
that we have treated our customers fairly and with integrity."
   In January, U.S. Judge Andrew J. Guilford of Los Angeles refused
to grant defense motions to dismiss the litigation, allowing NAACP
lawyers to subpoena bank records and question bank officials.