Wells Fargo Beats Bias-in-Lending Claims in Northern California

Wells Fargo & Co. isn’t liable to Oakland, Calif., under the Fair Housing Act for its allegedly discriminatory lending practices, the en banc Ninth Circuit said.

Oakland alleged that Wells Fargo’s discriminatory lending practices for minority borrowers caused higher default rates, which triggered higher foreclosure rates that drove down the value of city properties. That led to lost property tax revenue and increased city expenditures, it said.

The FHA is designed to protect minority borrowers who received predatory loans, the opinion by Judge M. Margaret McKeown said. Oakland’s theory of harm goes far beyond that, it said.

Nor can the ...