Wells Fargo Denies Former Mortgage Consultant Lending Claims

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LOS ANGELES (CNS) - Wells Fargo has responded to a mortgage consultant's lawsuit claims that he was fired for complaining about the institution's discriminatory lending practices by promising that the bank will fight the allegations in court.

Stuart Williams' Los Angeles Superior Court lawsuit also names Wells Fargo Home Mortgage Inc. and his former manager, Tina Shayestehfar, as defendants. He alleges wrongful termination, rescission of contract, intentional and negligent misrepresentation, breach of the implied covenant of good faith and fair dealing and a violation of the state Labor Code in the suit brought Tuesday.

“We strongly disagree with the claims made in this lawsuit and will vigorously defend against those claims,'' a Wells Fargo representative said in a statement released Thursday.

Williams, who worked at a Wells Fargo mortgage office in Beverly Hills, first expressed his concerns during a January 2020 meeting with his superiors in which he said he believed that the bank had a policy of favoring some loan originators over others, the suit states. The preferred ones allegedly had their loans moved to the front of the line and were closed faster.

He said the alleged practice was a violation of the Uniform Deceptive and Abusive Practices Act because it has an adverse effect on those customers who apply with the less-favored originators.

Three months later, Williams protested to his superiors when Wells Fargo instituted a policy that would shut off the mortgage consultants' ability to originate refinances with anyone who did not have at least $250,000 on deposit with the bank already, the suit states. He also complained to Wells Fargo CEO and President Charles Scharf in a January email, explaining that one of the basic requirements of the Equal Credit Opportunity Act and the FHA is that loan originators cannot refuse to take an application from a borrower who is a member of one of the protected classes or from anyone else, according to the suit.

Williams says management at Wells Fargo Home Mortgage made it mandatory for mortgage consultants such as himself to refuse loan applications from borrowers who are members of racial minorities, the elderly, the disabled, unmarried women and others protected by the ECOA the FHA, the suit states.

The policy requiring that applicants have a minimum $250,000 on deposit was changed in June 2020 to state that only borrowers who had an account or mortgage with Wells Fargo before that date could apply, while all other borrowers could apply only if they were willing to deposit $1 million with Wells Fargo prior to applying, the suit states.

Williams had to call one borrower and tell him that Wells Fargo declined his loan because he did not have $1 million on deposit with the bank and that the only way he could take his loan application would be if he were to deposit that amount before applying, the suit states.

“This policy resulted in disparate impact discrimination, which plaintiff pointed out only to be ignored and retaliated against very soon after,'' the suit states.

Williams also maintains that Wells Fargo illegally refused loan applications by telling loan officers to demand that borrowers only apply online. He was instructed in writing by Shayestehfar that he was not allowed to take a phone application from another borrower unless he first gave his boss the chance to convince the borrower to apply online, according to the suit.

Williams believes that due to his attempts to properly report and not participate in any alleged illegal conduct, he was harassed, intimidated and subjected to retaliation that ultimately led to his firing.

He has suffered a loss of earnings and benefits as well as damage to his reputation, the suit states.

Copyright 2021, City News Service, Inc.

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