Like Wells Fargo and Bank of America before it, Morgan Stanley is now facing claims that it discriminated against Blacks in the lead-up to the housing crisis.
Just two months ago, big bank Wells Fargo agreed to pay $175 million to settle an allegation that said it had instituted prejudiced business practices in the run up to the housing crisis. Wells Fargo admitted no wrongdoing, but they paid to avoid litigation by the Justice Department, which believed that the bank had steered Blacks and Latinos into dangerous subprime loans. Reported BET’s Deborah Creighton Skinner in July:
The federal government alleges that between 2004 and 2008, Wells Fargo steered 4,000 African-American and Hispanic borrowers into subprime mortgages when non-Hispanic white borrowers with similar credit profiles received prime loans. All those borrowers had qualified for regular Wells Fargo loans according to Well Fargo’s criteria.
The bank also is accused of charging about 30,000 African-American and Hispanic borrowers higher fees and rates than non-Hispanic white borrowers based on their race or national origin instead of their credit worthiness or other objective criteria related to borrower risk.
With that victory as a guiding light, the American Civil Liberties Union filed a class-action lawsuit in the U.S. District Court in New York that claims Morgan Stanley also discriminated against Black borrowers.
“The lawsuit claims Morgan Stanley pushed New Century [a mortgage lender] to issue certain types of loans with no concern about risk because it made its profit at the outset when the investment bank bundled the loans into securities and sold them,” said the Associated Press.
Last year, like Wells Fargo — and perhaps like Morgan Stanley will do — Bank of America also settled a bias suit for hundreds of millions of dollars with the Department of Justice.
While money is nice, bankers and mortgage lenders who took advantage of so many innocent minority families haven't been held responsible. Shouldn't someone be going to jail?
While people who were taken advantage of might get some financial compensation, they still live in a nation where a Black kid with marijuana can go to prison while a wealthy white banker who hurt families for profit can get off by writing a fat check.
Where is the justice?
These opinions do not necessarily reflect those of BET Networks.
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(Photo: AP Photo/Richard Drew)