October 8, 2026, 2:14 p.m. ET
The Trump administration is investigating a Wells Fargo program aimed at increasing homeownership rates among Black Americans, signaling a sharp escalation in its offensive against diversity, equity and inclusion programs.
The Department of Housing and Urban Development opened a federal civil rights investigation, accusing the bank of sorting homeowners by race.
Craig Trainor, assistant secretary for Fair Housing and Equal Opportunity, said in a letter to the bank’s CEO, Charlie Scharf, that the agency would review the bank’s commitment to expanding access to home loans for Black Americans and other minority groups.
“Even though Wells Fargo did not violate the law, its practice of dividing Americans on the basis of race is immoral, unethical and un-American,” HUD Secretary Scott Turner said in a statement. “Wells Fargo and all of its employees who made decisions based on race should be ashamed of themselves.”
Wells Fargo declined to comment. The bank has been hit in recent years by allegations of discrimination against black customers. The bank faced backlash after a Bloomberg report found it rejected half of all refinancing requests from Black families in 2020.
In the Trump administration’s view, these programs violate the Fair Housing Act and discriminate against other home buyers. A senior HUD official told the Wall Street Journal that the agency was studying similar initiatives at other financial institutions.
Fair housing advocates say the Wells Fargo program was created under federal rules that expressly authorized it.
“Congress enshrined Special Purpose Credit Programs (SPCPs) into federal law 50 years ago to allow lenders to adopt programs to address the effects of historic barriers and exclusions from the lending market based on gender, race and national origin,” Nikitra Bailey, executive vice president of the National Fair Housing Alliance, said in a statement.
“Investigating a bank for following the government’s own rules to create avenues to address long-standing discrimination in lending is an abuse of the agency’s investigative power and a transparent attempt to scare every lender across the country away from their legal obligation to serve underserved communities,” she said.
Wells Fargo has pledged $150 million to lower mortgage rates and refinancing costs for eligible Black homeowners. HUD accused Wells Fargo of dividing Americans by race, in violation of the Fair Housing Act, a civil rights-era law prohibiting discrimination based on factors such as race.
“Attempting to close racial statistical gaps in homeownership by providing loans based on race is not the way to do business,” Trainor wrote. “And doing so in transactions related to residential real estate is illegal under the Fair Housing Act.”
The investigation into mortgage lending practices to minority groups is a swipe at financial institutions engaged in race-based lending practices that the Trump administration says proliferated under the Biden administration.
The Justice Department has launched anti-fraud investigations into federal contractors, targeting DEI programs created after the killing of George Floyd in 2020. Since the election of President Donald Trump in 2024, many companies have opted out of these programs.
Wells Fargo’s investigation not only marks a new chapter in the federal crackdown on corporate DEI initiatives, but it exposes financial institutions to increased government scrutiny and growing regulatory and legal risks.
Previous administrations have pressed banks to develop programs aimed at closing racial gaps in homeownership. By 2024, less than a quarter of black households owned the home they lived in, compared to nearly three-quarters of white households, according to the Pew Research Center.
Critics argue the administration is ignoring the legacy of government-backed redlining and restrictive covenants that barred Black and minority Americans from creating wealth through homeownership. Additionally, discrimination continues to unfairly limit access to homeownership as the country faces an affordable housing crisis, they say.
“The Trump administration now appears increasingly interested in dismantling policies designed to recognize these consequences while invoking the language of equality to justify this decision,” citizen journalist George Cummings wrote in his article “What Did Donald Trump Do Today?” Substack.
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