July 27, 2017 

By Hazel Trice Edney 

 

According to the following statistics, the economic condition of America's Black community is in dire straits:

 

A recent study by Harvard University found that homeownership in the Black community stands at only 42.2 percent in the nation’s largest metro areas. That’s below the Latino-American community, which is at 46 percent and well below the White-American community, which is at 72 percent.

 

In addition, the mortgage denial rate for Blacks is more than 25 percent, near 20 percent for Latinos but just over 10 percent for White applicants, according to the Center for Enterprise Development.

 

Likewise, the U.S. Black Chambers, Inc. says the lack of access to capital remains the greatest barrier to the establishment, expansion and growth of Black-owned businesses.

 

Finally, Black-owned banks, which grant an overwhelming majority of their loans to Black people, continue to climb their way out of the disparate hit they took during the great recession while maintaining their historic role in stabilizing Black communities.

 

These revelations illustrating the economic struggles of African-Americans are the driving forces behind the founding of a new group that's leading a movement for Black economic justice across America.

 

 

 

 

 

Black Wealth 2020, formally established only two years ago, aims to lock arms with some of the most historic national civic and civil rights organizations with a goal to impact economic outcomes in Black America over the next three years. The group's three-pronged strategy is to increase the number of Black homeowners, strengthen Black-owned businesses and increase deposits in Black banks by the year 2020.

 

 

“This is, in my recollection, the first time there’s been a systematic effort to draw our community’s attention to these very critical issues related to wealth-building and economic self-sufficiency. That being the importance of supporting Black banks, the importance of homeownership, the importance of growing Black businesses - those really are the three pillars of economic empowerment,” says Marie Johns, former deputy administrator at the Small Business Administration and retired president of Verizon Washington, who is a member of Black Wealth 2020.

 

 

 

“If you have strong business ownership, strong home ownership and strong financial institutions, that’s freedom. It’s the closest proximity that we’ll get,” says Johns, also chair of the Howard University board of visitors and creator of SBA’s Council on Underserved Communities.

 

In a nutshell, the seeds of Black Wealth 2020 were initially planted during a fight for economic justice. It started about seven years ago as several like-minded heads of organizations with economic components began regularly discussing the financial plight of Black people.

 

The group gelled after National Bankers Association President Michael Grant, National Association of Black-owned Broadcasters President Jim Winston and U.S. Black Chamber President Ron Busby joined forces with Con­gresswoman Maxine Waters (D-Calif.) to push for Black business inclusion in a proposed merger between Comcast and NBC Universal.

 

Winston had asked Waters, ranking Democrat on the House Financial Services Committee, to take action in the situation. Winston then pulled in Grant who pulled in Busby. The Comcast merger ultimately failed. But, “We decided to put together some kind of organizational team,” recalls Grant, “So that whenever these issues come up, we’ll have a united front and we’ll have a lot of organizations. That's how Black Wealth 2020 was formed.” The ultimate goal is to “turbo charge” Black wealth, Grant says.

 

While Black Wealth 2020 is uniquely economic, it aims to work alongside traditional civil rights or­ganizations, including the National Urban League, the NAACP and others, Winston says.

 

“We have been concerned that for many years the Black civil rights movement had been the only national voice of the African-American community. Those groups do a great job but there are business and economic battles that the Black community has been fighting. And we don’t believe that the Black community’s voice has been strong enough and effective enough in that regard,” says Winston. “And so we are able to strengthen each other in each other’s activities as well as our collective voice for the Black community.”

 

Other leaders in Black Wealth 2020 are HomeFree USA President Marcia Griffin; Zenviba Academy of Arts and Science President John Templeton; Collective Empower­ment Group National President Dr. Jonathan Weaver; National Asso­ciation of Real Estate Brokers President Ron Cooper; Enlightened: Beyond Expectations President Antwanye Ford; and Delta Sigma Theta President Dr. Paulette Walker. At latest count, the group has a total immediate reach of at least 3 million people.

 

Members of Black Wealth 2020 are quick to point to the historic roots of its economic goals. When Dr. Martin Luther King Jr. was assassinated on April 4, 1968, he had launched a “Poor People’s Campaign,” an economic justice movement that had begun in Memphis.

 

John Templeton, founder of the now 14-year-old National Black Business Month in August, sees the work of Black Wealth 2020 as a continuum of Dr. King’s vision. Templeton contends the prophecy spoken by King the night before his death must still come to fruition.

 

“King said he wasn’t going to get to the promise land with us. But we as a people will get to the promise land. And people have forgotten that,” Templeton says.

 

Over the past 49 years since the assassination of Dr. King, other Black economic strategies have popped up and fizzled out. For this movement, Black Wealth 2020 members say the strategy for sustainability is built in, including the following elements:

 

Black America's current state of affairs: “This current administration is going to force us to look internally because we don’t have any help ­coming from outside our community,” says USBC President Ron Busby. “It’s not about one organization or about one individual leading the conversation, but once the mission was set and the three goals were established we can now go back to our collective constituencies and say this is what’s important.”

 

Youth involvement: National Bankers President Grant says the participation of youth is key. Black Wealth 2020 has begun incorporating and mentoring youth economic leaders in their monthly meetings. “In my study of history, going back to ancient times, I can’t think of any major movement that was a societal changing movement that wasn’t driven by the energy of youth,” Grant says.

 

Shared Leadership: “In the past, movements have been tied to one individual. And as soon as there is some issue, and perhaps maybe death, often times what happens on the demise of that individual is the organization goes through a down spin and it in many instances ends up being discarded,” says Dr. Jonathan Weaver. “As a result of this, there is no mindset or mentality among any of us that we want to be the one to be glorified or recognized as the so-called leader. That there is indeed shared leadership within this body and because we are so focused and so intentional about it, we really are just very resolute and determined to make this work.”

 

Unique structure: The umbrella structure of Black Wealth 2020 also lends to unity, accountability and sustainability. “This is not just one organization, but this is a series of organizations that have come under one banner and will be about empowering Black people,” Weaver says.

 

The urgent need for economic growth: “It’s a fact that more than half of all African- Americans in our country rent. It’s a fact that a homeowner’s net worth is 36 times that of a renter. And it's a fact that the median income for an African-American household is $35,000 compared to the national average of $53,000,” says Marcia Griffin of HomeFree USA. “This is an unacceptable situation for our people, and Black Wealth 2020 initiatives are critical in reversing these statistics and rebuilding wealth in the Black community.”

 

Clear and positive vision: “This is not an anti-White movement, this is not a reactionary movement. This is a very positive affirmation about Black love and Black support and it's an acceptance of full responsibility of our economic survival,” says Grant.

 

Despite the name, representatives of the Black Wealth 2020 movement say they have vision well beyond only three years from now.

 

“One of our founders thought we should call ourselves Black Wealth 2020 and Beyond. While we were definitely in favor of that concept, we felt the name was a little cumbersome,” Jim Winston chuckles. “So our goal, of course, is to continue beyond 2020. Building wealth in the African-American community is not an item that has a time line on it or a deadline on it...We just wanted to give ourselves a target where we can see some substantial improvements in that time frame.”

July 27, 2017 

By Dr. John Warren 

Intergovernmental Affairs 

Contributing Writer 

 

The fake accounts set up in the name of over 3 million bank customers since 2002, and the lowering of the Wells Fargo Bank rating with the Office of the Comptroller of the Currency in the U.S. Treasury Department from “satisfactory” to “needs improvement”, has had significant consequences resulting in the loss of billions of dollars in municipal deposits. When a banks ratings change under the Community Reinvest­ment Act from “satisfactory” to “needs improvement”, cities will often withdraw their deposits. This action has a part of a trend with a number of cities from Seattle to San Francisco, Albuquerque, New Mexico, and to Raleigh, North Carolina.

 

The many woes of Wells Fargo, growing out of fake accounts, and violations of federal laws, fines and class action lawsuits, have reached beyond “bad banking practices” to the kinds of financing Wells Fargo provided to such projects as the Dakota Access Pipe Line (DAPL).  Members of the Standing Rock Sioux tribe and organizers of the protest against the DAP, initiated actions in a number of cities starting with the Seattle City Council, to withdraw municipal deposits, and effectively bar local governments from investing with Wells Fargo Bank because of its financing of the DAPL.

 

In February of 2017, the Seattle City Council voted to sever its relationship with Wells Fargo Bank as of 2018 stopping the flow of over $3 billion through the institution each year. The reason given, because of the banks “dishonest business practices” as well as its pipeline financing.

 

On May 31, New York City became another city removing the bank’s deposits and participation in its General Obligations and Transitional Finance Authority bond sales. This action will deprive Wells Fargo Bank of billions of dollars in municipal deposits in the coming year.

 

Since then cities like San Fran­cisco, Los Angeles, Bellingham, Raleigh, N.C., Albuquerque, and even Berlin, have made DAPL divestment a reality against Wells Fargo in their cities. In California, officials in the cities of Davis and Santa Monica either have or are moving to withdraw deposits from Wells Fargo.  Davis is or will be withdrawing $124 million in deposits. The city of Santa Monica plans to take $1billion from Wells Fargo Bank.  The City of Los Angeles already has won a $142 million class action lawsuit. The City of Albuquerque, New Mexico is withdrawing over $500 million in investment with Wells Fargo as of June 2016.

 

On July 14, 2017, second quarter profit reports revealed that while New York based Citigroup's profits fell 3 percent, as the bank covered bad loans, profits rose for Wells Fargo and JP Morgan Chase due in part to rising interest rates. Wells Fargo's profits grew by 5 percent to $5.8 billion, or $1.07 a share over the $1.01 per share expected. Wells Fargo’s net income climbed 6 percent to $12.5 billion.

 

Let’s look at the bigger picture of Wells Fargo Bank which trades on the New York Stock Exchange as WFC. Wells Fargo is a diversified, community based financial services company with $2.0 trillion dollars in assets with offices in 42 countries and territories to support customers who conduct business in the global economy. The company has approximately 273,000 employees and claims to serve one in three households in the United States.

 

It would appear against this back drop that: (1) the settlement last September with federal regulators of fines totally $185 million dollars for violations of Dodd-Frank banking laws; sections of Sarbanes Oxley prohibiting retaliation against whistleblowers, and violations of the overtime provisions of the Fair Labor Standards Act covering hours of work; would represent significant losses; (2) The $142 million class action lawsuit against Wells Fargo by the Los Angeles City Attorney's office, recently approved by a federal judge, is not all that its seems. It is reported that all except about $25 million dollars of that payout will go to lawyers and administrative cost. Then Wells Fargo customers will be paid for out of pocket losses, such as fees from fake accounts. The balance of anything left will be divided among customers based on how many and what kinds of accounts.

 

The bank has agreed to put more money in the settlement fund if less than $25 million is left for wronged customers after paying lawyers, expenses and out of pocket cost.

 

Of the payout last September to federal regulators, already mentioned in this article, $3.26 million was repaid in fees to wronged customers and an additional $1.8 million has reportedly been paid to cover complaints from customers about fake accounts.

 

Let’s remember that when we look at the increased profits of Wells Fargo reported for the second quarter of this year,  and the total worldwide assets of over $2.0 trillion dollars and 273,000 employees, the 5,000 employees fired over the fake accounts seems insignificant. These facts might make the bank look untouchable in terms of financial loses. But don’t forget that the more than $3 billion dollars that municipalities have agreed to pull in deposits from Wells Fargo starting in 2018, is not yet a part of the banks profit and loss statements.

 

None of these items address the communities of color who have been ignored by Wells Fargo outside of “cherry picking” a few business entities and making no real good faith effort to recover the confidence of many who have been turned away.

July 13, 2017 

City News Service 

 

An attorney and another defendant have been sentenced to more than three years in federal prison for bilking distressed homeowners out of $6 million in a mortgage modification scheme, prosecutors said Wednesday.

 

Ronald Rodis, 52, of Long Beach was sentenced Tuesday to 41 months in prison and Charles Wayne Farris, 56, of Aliso Viejo was sentenced to 47 months behind bars by U.S. District Judge David O. Carter in Santa Ana.

 

Carter also ordered Farris to pay $3.5 million in restitution and Rodis to pay $3.8 million.

 

Co-defendant Bryan D’Antonio was sentenced in April to 109 months in federal custody, with 97 months behind bars and the rest in a halfway house. D’Antonio, 50, was also ordered to pay $3.8 million in restitution.

 

Between October 2008 and June 2009, D’Antonio got distressed homeowners to pay up to $5,500 to a team of fictitious attorneys to negotiate lower mortgage rates, prosecutors said.

 

Rodis allowed his name to be used to lend credibility to the scheme, prosecutors said. He also did radio ads to promote the scheme. Rodis, whose law firm was based out of Newport Beach, has resigned from the state Bar of California.

 

Farris’ role was to supervise dozens of telemarketers who took calls from distressed homeowners who heard the ads, prosecutors said.