5-25-11: Baltimore v. Wells Fargo
Can a city hold a mortgage lender legally responsible for its blight?
In 2008, the city of Baltimore filed a legal complaint against Wells Fargo, alleging that the lender violated the Fair Housing Act by disproportionately targeting minority borrowers for subprime loans–what’s called “reverse redlining.” The lawsuit alleges that the bad loans led to foreclosures, and it seeks damages, claiming that vacant foreclosed homes depress property values and become a financial burden because of demands on city services like police and fire calls.
U.S. District Court Judge J. Frederick Motz granted Wells Fargo’s motions to dismiss on the original complaint and the amended complaint. Last October, Baltimore amended it again, and in April Judge Motz denied Wells Fargo’s motion to dismiss. The case goes forward.
Sheilah talks about the case with Baltimore City solicitor George Nilson.
Sheilah also talked to Wells Fargo Vice President for Mortgage Communications Vickee Adams. The full audio of that interview is here:
The Wells Fargo case hinges on measuring a link between alleged lending practices and the extra expenses Baltimore incurs because of vacant homes.
Measurement of social data hasn’t just changed the courtroom. Teacher compensation is increasingly tied to measurements of student achievement. In health care, the insurer WellPoint is threatening to stop payment increases to hospitals that don’t do well on their measures of patient care.
Sheilah discusses measurement-mania with Louis Hicks, a sociology professor at St. Mary’s College of Maryland and a co-author of The First Measured Century, which was the basis for a PBS documentary by the same name. You can listen to their full interview here:
You can also check out our last segment with George Nilson about the Wells Fargo case, from January 2010.