The Department of Housing and Urban Development has opened an investigation into Wells Fargo over whether the bank’s home lending programs violated federal fair housing law by favoring borrowers based on race.
HUD Secretary Scott Turner announced the probe Wednesday, writing on X that HUD “launched an investigation into Wells Fargo’s apparent race-based lending programs” and calling such programs “DEI (diversity, equity, and inclusion) dressed up” as equal opportunity.
The American Dream is rooted in equality, not racial sorting. DEI is division dressed up as progress — and we are ending it under @POTUS.
The Wall Street Journal first reported on the investigation, which HUD detailed in a letter sent to Wells Fargo Chairman and CEO Charlie Scharf from Craig Trainor, HUD’s Assistant Secretary for Fair Housing and Equal Opportunity.
The letter states that under the Trump administration, “it is the policy of the United States to protect the civil rights of all Americans,” and that this mandate includes enforcing the Fair Housing Act nationwide. It argues that “race-conscious lending programs proliferated throughout the financial sector” under the Biden administration, despite the Fair Housing Act barring discrimination against “any person” in lending “because of race … or national origin.”
Trainor wrote that he has directed HUD’s Office of Special Investigations to determine “whether Wells Fargo has violated or intends to violate 42 U.S.C. § 3605” in response to what he described as the bank’s “repeated public promotion of explicit race-based lending policies.”
If HUD’s Office of Fair Housing and Equal Opportunity finds reasonable cause, the letter says the agency may file a discrimination complaint against Wells Fargo directly 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 matter, including documents, electronic files and internal communications. The letter gives HUD’s fair housing office ten business days from its date to issue initial information requests to the bank.
Turner did not soften his criticism of the bank regardless of the probe’s legal outcome.
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.
Trainor echoed that position in his own statement, rejecting the idea that race-based lending can be excused by relabeling it.
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.’
He added that the administration intends to apply the law without regard to an institution’s size or influence: “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 faced scrutiny before over its lending to Black Americans, and in response expanded diversity-focused lending initiatives aimed at increasing minority homeownership. Those same initiatives are now the subject of the federal investigation.
The probe follows other recent HUD actions targeting federally backed housing programs, including a March 2025 crackdown aimed at illegal immigrants and non-permanent residents receiving FHA-backed loans.
