The Department of Housing and Urban Development has opened an investigation into Wells Fargo over whether the bank’s lending programs aimed at minority homeowners violated the Fair Housing Act.
HUD Secretary Scott Turner announced the probe on Wednesday, saying some of the bank’s home loan policies amounted to “DEI dressed up” as equal opportunity. “DEI is division dressed up as progress — and we are ending it under @POTUS,” Turner said, referring to President Trump, in a social media post.
According to the Wall Street Journal, HUD sent a letter to Wells Fargo CEO Charlie Scharf notifying the bank that the agency will examine whether it violated fair-lending laws by favoring Black or other minority homeowners in its lending practices.
The letter, signed by Assistant Secretary for Fair Housing and Equal Opportunity Craig Trainor, states that “it is the policy of the United States to protect the civil rights of all Americans,” and that this includes compliance with the Fair Housing Act.
The letter asserts that “under the Biden Administration, race-conscious lending programs proliferated throughout the financial sector,” and argues the Fair Housing Act prohibits any entity involved in “residential real estate-related transactions” from discriminating against “any person” based on race or national origin.
Trainor wrote that he has directed HUD’s Office of Special Investigations to look into whether Wells Fargo “has violated or intends to violate 42 U.S.C. § 3605,” citing the bank’s “repeated public promotion of explicit race-based lending policies.”
The letter states that if HUD’s Office of Fair Housing and Equal Opportunity finds reasonable cause to believe Wells Fargo violated or intends to violate customers’ civil rights, the agency could file a discrimination complaint against the bank or refer the matter to the Department of Justice for further enforcement.
HUD has also ordered Wells Fargo to preserve all records related to the investigation, including documents, electronic records and communications. The letter states that within ten business days, HUD’s Office of Fair Housing and Equal Opportunity will issue initial requests for information from the bank.
Officials Defend the Probe
Turner said in a statement: “Even if Wells Fargo did not violate the law, its practice of dividing Americans based on race is immoral, unethical and un-American. Wells Fargo and all of its employees that engaged in race-based decision-making should be ashamed of themselves.”
“The Fair Housing Act forbids racial discrimination in housing. It does not say: discriminate, so long as the discrimination is called a ‘special purpose credit program’ and justified as advancing ‘racial equity in homeownership,'” Trainor said.
Trainor added: “No matter an institution’s size, wealth, or power, if there is reasonable cause to believe it has violated Americans’ civil rights, the Trump Administration will hold it to account.”
Wells Fargo has previously faced criticism over its home lending practices toward Black Americans, and in response expanded initiatives intended to help minority homeowners. Those same efforts are now the subject of the administration’s inquiry into whether they ran afoul of fair-lending laws.
The investigation follows other recent HUD actions regarding federally backed housing programs, including a March 2025 move to restrict access to FHA loans for illegal immigrants and non-permanent residents.
