Units of Countrywide Financial Corp of Calabasas were subpoenaed today in Illinois along with Wells Fargo & Co in an investigation by that state’s attorney general into lending practices. Attorney General Lisa Madigan is probing into whether the companies violated federal law by corralling non-white borrowers into more expensive loans than those offered white borrowers, Reuters reported. Madigan’s inquiry comes behind a local magazine’s study that revealed wide disparities in loan prices between races. Countrywide, the largest U.S. mortgage lender, is amid federal and state investigations of its lending practices, as well as several investors’ lawsuits. Countrywide said in a statement it “will cooperate fully in any investigation by the attorney general.” The Illinois investigation centers on the Chicago Reporter magazine’s report that black borrowers were three times as likely, and Latino borrowers were twice as likely, as white borrowers to get high-priced home loans. Countrywide Home Loans Inc and Wells Fargo Financial Illinois Inc. were the units served by the subpoenas.
Countrywide Subpoenaed by Illinois AG