Wall Street Journal: “Wells Draws $85 Million Penalty in Subprime Case”

While predatory lenders in the multi-family market have yet to be reprimanded, the good news is that the single family market is having some limited success.

Wells Fargo & Co. agreed to pay an $85 million civil penalty Wednesday in response to allegations it steered thousands of potential prime-mortgage borrowers into more-costly subprime loans.

A cease-and-desist order issued by the Federal Reserve Board is the first formal enforcement action taken by federal bank regulators involving allegations of steering borrowers into high-cost subprime loans. The penalty is the largest issued to date by the Fed in a consumer-protection enforcement action.”

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