Sarah J. Blige

Amy Goodman of Democracy Now interviewed a former Wells Fargo subprime loan officer who now works in foreclosure defense about the subprime lending scheme that made thousands homeless and allegedly targeted African Americans and other minorities.

Elizabeth Jacobson worked at Wells Fargo for nine years and was one of the top loan officers in the subprime division of the company for two years, but she put in her resignation after discovering the corruption and illegal lending practices within Wells Fargo.

Elizabeth, along with another former Wells Fargo employee, filed a sworn affidavit in June of this year in support of a lawsuit by the city of Baltimore accusing Wells Fargo of pushing high-interest, subprime loans onto African Americans, forcing hundreds into foreclosure and leaving their families homeless.

Elizabeth explains how loan officers at Wells Fargo were encouraged to sell subrpime loans to their customers, even when a customer’s credit rating had qualified them for a prime loan. She says loan officers were rewarded with much higher commission for selling a subprime loan than they were for selling a prime loan. She further explains that loan officers were taught how to make a subprime loan seem like the better option by leaving out important bits of information about rate adjustments and the repayment process.

Elizabeth discusses the allegations of Wells Fargo targeting minorities in their subprime lending scheme:

“A lot of this was information that I would receive on conference calls as a sales manager. And people on the call, the management there, would encourage the loan officers, the subprime loan officers, to go into Baltimore city and target the churches, the African American churches, to get a relationship going with the minister or the reverend at the church and try to get that person to schedule some sort of meeting. They would call it a “wealth-building seminar” to get the parishioners of the church to attend. And any loan that was funded by Wells Fargo, whether a purchase or a refinance, $350 would then be donated to the church. And so, that was the incentive for the church to want to have these seminars there.

But what would happen is the only loan officers that would attend these seminars were generally the subprime loan officers. And on these conference calls, at one point, somebody made a joke who happened to be a white loan officer and said, “Well, will I be able to go to these seminars?” And they were told right there on the conference call, unless you were of color, you could not attend these conferences, these wealth-building conferences. So it seemed me—Wells Fargo didn’t come right out and say this; this is just what I saw—is that they wanted the African American Wells Fargo loan officers to sell loans to the African American community.”

A new documentary called American Casino examines the subprime crisis in America, and is playing in select theatres across the USA. Unfortunately, it will not be showing anywhere in Canada, but you can sign up on the website to be notified when the DVD becomes available.  Watch the trailer below.