Chicago can pursue part of Wells Fargo predatory lending case

(Reuters) – A federal judge significantly narrowed but refused to dismiss a lawsuit accusing Wells Fargo & Co, the third-largest U.S. bank, of predatory mortgage lending targeting black and Hispanic borrowers in the Chicago area.

U.S. District Judge Gary Feinerman ruled on Monday that Illinois’ Cook County, which includes Chicago, may pursue federal Fair Housing Act claims against Wells Fargo, to the extent the bank’s alleged “equity stripping” practices boosted the cost of administering and processing a higher number of foreclosures.

But Feinerman dismissed claims alleging harm from lost property taxes, the need to combat crime and blight, racial segregation and other factors, calling them “ripples” that “flow far beyond” Wells Fargo’s alleged misconduct.

Read on.

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