‘California in Crisis’ details Wells Fargo’s damage to California’s communities of color

by Tony Robles

“Listen to your soul’s voice; it’ll tell you what you should do.” – Displayed on the screen of a Wells Fargo Bank ATM

I work as a housing advocate in San Francisco, a city whose soul is under attack by those who have sold their souls in exchange for any number of illusions and delusions. During my lunch break a couple of weeks ago, I walked down Mission Street towards Van Ness Avenue. The sun was out after hiding behind the clouds for a few days.

I approached the offices of Goodwill Industries when I saw a young African American man about 23 years old talking to two attractive young women of color. Within earshot of the conversation, I heard the women’s words: “We want to help you get a bank account. It’s easy. Wells Fargo has a good program that can help you.”

The young man was taken in by the beauty of the deal, by Wells Fargo Bank or – at the very least – by the beauty of the two young women. Both were smartly dressed and speaking the company line in sweet coos meant to seduce even the most stubborn and hardened of men, or men like the young brother clad in work overalls and a baseball cap, shielding his eyes from the glare of the sun.

As if on cue, another young man joined in the exchange, drawn in like a bee to honey. Soon the two young men gave the young women the keys to the kingdom – including their names, phone numbers, driver license numbers, birthdates and other important data. One of the young women occasionally glanced at her watch while acting quite professionally.

 
Maybe it was the “soul’s voice” of those young women leading them to enlist the young brothers as bank account holders with Wells Fargo, in spite of the fact that the company is responsible for more foreclosures than any other lender in California.
 

I stood nearby, pretending to wait for the No.14 Mission bus. Goodbyes were exchanged and the young brothers walked towards the entrance of Goodwill. It was then that my “soul’s voice” made me call out, “Excuse me, brothers! Did you know that Wells Fargo …”

Maybe it was the “soul’s voice” of those young women leading them to enlist the young brothers as bank account holders with Wells Fargo, in spite of the fact that the company is responsible for more foreclosures than any other lender in California.

Or perhaps the two female employees were led by the voice of Wells Fargo CEO John Stumpf echoing the dictum of corporate shareholders, whose greed has caused evictions and death to elders, communities of color, families and people with disabilities through its predatory and discriminatory lending practices.

The Alliance of Californians for Community Empowerment (ACCE) is at the forefront of the resistance to the foreclosures and illegal taking of homes by the banks. ACCE, the Center for Popular Democracy and the Home Defenders League released a report March 12 entitled “California in Crisis: How Wells Fargo’s Foreclosure Pipeline is Damaging Local Communities.”

Representatives from ACCE, which include foreclosure resisters from the community, rallied in front of the Wells Fargo headquarters in San Francisco’s Financial District to launch the report and call for Wells Fargo to halt foreclosures and commit to a principal reduction program.

The “California in Crisis” report cites Wells Fargo as providing fewer principal reductions than both JPMorgan Chase and Bank of America – two banks that could themselves be doing more.

The report’s findings also show the damage that has been inflicted on California by Wells Fargo. It warns that if the bank does not reverse this course, the financial damage will further cripple the state’s economy and increase the financial severity brought upon communities of color.

According to the study, of the 65,466 loans in California’s foreclosure pipeline, 20 percent of them are serviced by Wells Fargo. Wells Fargo has nearly 12,000 distressed loans. If those loans go through foreclosure, California will suffer even more than it already has.
The “California in Crisis” report cites Wells Fargo as providing fewer principal reductions than both JPMorgan Chase and Bank of America – two banks that could themselves be doing more.

Homes will lose 22 percent of their value for a total loss of $1.07 billion. Surrounding neighborhood values will go down for an additional loss of $2.2 billion, and the tax revenues lost due to depreciation will amount to $20 million. The report includes maps for seven big cities, focusing on communities of color. Clusters of homes with distressed loans are located in hard hit communities of color.

If the bank does not reverse this course, the financial damage will further cripple the state’s economy and increase the financial severity brought upon communities of color.

San Francisco Supervisor David Campos echoed the concerns and expressed support in a statement: “Our communities and our entire state are still reeling from the housing crisis and will be for years to come. As the report shows, the numbers of homes still facing foreclosure is enormous. Principal reduction is clearly a critical strategy for saving homes and stabilizing the economy. Wells Fargo and the other major banks should be doing more of it.”

Recommendations of the report:

1. Wells Fargo should commit to a broad principal reduction program
    
   Wells Fargo has the legal authority to offer every homeowner facing hardship a loan modification, based on an affordable debt-to-income ratio and achieved through a process that prioritizes principal and interest rate reductions.
2. Wells Fargo should report data on its principal reduction, short sales and foreclosures by race, income and zip code
    
   The people of California need to know that Well Fargo is no longer discriminating against people of color and is fairly and equitably providing relief to homeowners and to the hardest hit communities.
3. Wells Fargo should immediately stop all foreclosures until the first two demands are met
    
   In the time that it takes to set up a fully functioning principal reduction program, Wells Fargo needs to immediately stop all foreclosures. The bank has done enough harm. It’s time to stop.

To read the report by ACCE, go to http://www.calorganize.org/sites/default/files/CA%20in%20Crisis%20-%20Wells%20Fargo%20Report.web_.pdf.

To send a letter to Wells Fargo CEO John Stumpf, go to http://salsa.wiredforchange.com/o/6267/p/dia/action/public/?action_KEY=7456.

Tony Robles is the co-editor of POOR Magazine, where this story first appeared. He can be reached at [email protected].

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