Last week, the Department of Housing and Urban Development (HUD) announced a DEI probe into Wells Fargo. The federal agency alleges that Wells Fargo participated in discriminatory lending practices by encouraging homeownership among the black population. The Wall Street Journal summarizes the facts and history of the investigation:
“Wells Fargo’s campaign to help Black homeowners goes back years. In 2017, the bank said it was committing $60 billion in loans in an effort to help add at least 250,000 Black homeowners by 2027. In 2022, the bank expanded the program to put the company’s own money to work refinancing minority homes. That followed criticism the bank faced over a Bloomberg report that it had rejected half of all refinancing applications by Black families in 2020… Now, Trump officials are considering whether the bank’s efforts to help Black families were a violation of the Fair Housing Act. In its letter, HUD said Wells Fargo had adopted a strategy of “sorting” homeowners and offering different products or terms based on their race.”
This is another assault on DEI by the administration and similarly follows the DOJ’s DEI probe and eventual settlement with PayPal. While the government’s assault on sustainability has been only partially effective, DEI has been hit hard. Multiple companies have faced investigations over DEI practices, with many opting to settle. There are a couple of common factors among the companies targeted by the government’s investigations. In False Claims Act cases, they are companies working in partnership with the government. In cases like this one, they are federally regulated entities. Additionally, they often have DEI programs tied to specific demographic metrics. So far, fully private companies with no government contracts have avoided enforcement. We’ll likely see this trend continue as heavily regulated sectors like banking and healthcare bear the brunt of the attack.
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