SAN FRANCISCO — A federal lawsuit filed Monday accuses banking giant Wells Fargo of illegally denying student loans to young immigrants who are protected from deportation and allowed to work and study in the U.S. under a program created by former President Barack Obama.
Wells Fargo said it was disappointed the plaintiffs sued instead of working with the bank on a solution.
The young immigrants have Social Security numbers and documents that meet bank requirements for identification, but Wells Fargo refuses to give them student loans based on their citizenship status, according to the lawsuit by the Los Angeles-based Mexican American Legal Defense and Educational Fund.
“It’s very important in our view to establish that there are clear rules against this kind of discrimination, particularly in a time like this,” said Thomas A. Saenz, president and general counsel of the Mexican American Legal Defense and Educational Fund.
The suit seeks a court order declaring the policy discriminatory and forcing Wells Fargo to grant the loans to those participating in the Deferred Action for Childhood Arrivals program. It also seeks unspecified monetary damages.
“Wells Fargo understands the dream of pursuing higher education and we remain focused on our responsible lending practices to assist temporary and permanent residents and U.S. citizens in obtaining student financing,” the bank said in a statement.
Banking experts say financial institutions can face unique challenges getting repaid by borrowers who are not in the country permanently, including potential difficulty in accepting payments from foreign banks.
