The revelations could resonate in Iowa, where two groups have made similar accusations against the company.

Elizabeth Jacobson, who worked as a subprime loan originator for Wells Fargo in Baltimore from 1998 to 2007, said her former company would encourage subprime loan officers to go into the city and target African American churches.

….to get a relationship going with the minister or the reverend at the church and try to get that person to schedule some sort of meeting. They would call it a “wealth-building seminar” to get the parishioners of the church to attend. And any loan that was funded by Wells Fargo, whether a purchase or a refinance, $350 would then be donated to the church. And so, that was the incentive for the church to want to have these seminars there.

But what would happen is the only loan officers that would attend these seminars were generally the subprime loan officers. And on these conference calls, at one point, somebody made a joke who happened to be a white loan officer and said, “Well, will I be able to go to these seminars?” And they were told right there on the conference call, unless you were of color, you could not attend these conferences, these wealth-building conferences. So it seemed me—Wells Fargo didn’t come right out and say this; this is just what I saw—is that they wanted the African American Wells Fargo loan officers to sell loans to the African American community.

Anyone who received a loan from Wells Fargo during this period could ask that the company donate $350 to a nonprofit of the borrowers choice.

“But the way that it was sold to these churches was, well, that money then will go back to your church. Have the parishioner decide, as the church is a nonprofit, that they want that $350 to go right back to that church,” Jacobson said.

In June, Jacobson filed a sworn affidavit with a federal court in support of the City of Baltimore’s lawsuit against Wells Fargo for pushing high-interest, subprime loans onto African Americans in Baltimore and the Maryland suburbs.

In addition to the targeting of African American communities, Jacobson said there was a push to drive up the company’s subprime loan division while telling the media the company was trying to avoid the risky loans.

I just started to see, well, wait a minute, you know, we’re putting — we’re setting people up for failure, basically. And what really — the point that really made my decision that I was going to leave the company was third quarter of ’07. Wells Fargo was actually the number one subprime lender in the country. So, internally, we’re getting all these emails and all this information about “great job, we achieved our goal, we’re number one subprime lender in the country.”

And I happened to see a news report with the CFO of Wells Fargo, and he was questioned about the subprime division and denied at that point that Wells Fargo even had a subprime division. So here he is, the chief financial officer, where the subprime loans were supposed to be paying for the fixed costs of the company, and he’s denying that Wells Fargo even did subprime loans. That was just the final straw of total disillusionment, and then I put my resignation in.

Loan officers would make “three to four times as much in commission if you put somebody into a subprime loan,” she said.

Two watchdog groups have compiled data showing a similar pattern of racial discrimination in Iowa. Their numbers show that minority homeowners in Des Moines were three times as likely to receive a high cost subprime loan as their white counterparts.

So far, no legal action has been taken in Iowa.

Here is Jacobson’s full interview, via Democracy Now.

In the month of December 2008 alone, Iowa had 887 properties with foreclosure filings, up 70 percent from the previous month and a 58 percent increase from December 2007.

“Foreclosure activity increase only moderately in Iowa during 2008,” said James J. Saccacio, chief executive of RealtyTrac, publisher of the largest national database of foreclosure and bank-owned properties. “Although up 1 percent from January, the state’s unemployment rate finished 2008 well below the national average. Additionally, home sales declined only moderately compared to 2007. Taken altogether, these factors support the notion that foreclosure activity grew only slightly statewide last year.

Nationally, Iowa ranked 37th in total foreclosures for the year. With one in every 245 housing units receiving a foreclosure filing, Iowa’s foreclosure rate ranked 40th among the 50 states.

Five Iowa counties were responsible for 67 percent of all foreclosure activity in the state during 2008: Polk County (Des Moines) led the way, reporting 1,735 properties. Linn County (Cedar Rapids) was second with 627 properties. Scott County (Davenport) was third with 519 properties. Pottawattamie County (Council Bluffs) and Woodbury County (Sioux City) finished off the top five with 425 and 297 properties respectfully.

Looking at foreclosure rates, Pottawatamie County’s was the highest in Iowa, with just over 1 percent of its housing units receiving at least one foreclosure filing during 2008. Polk County was second with .96 percent, and Jasper County was third with .79 percent.

Overall, Iowa accounted for less than 1 percent of the 2,330,483 properties nationwide that had foreclosure filings. The national total represented an increase of more than 81 percent from the total reported for 2007.

Iowa Foreclosure Market Data by County – Year end 2008

Foreclosure filings were reported on 522 Iowa properties in November, an increase of 4 percent from the previous month, and 30 percentage points below the level reported for November 2007. Nationwide there were 259,085 properties with foreclosure filings during the month.

Iowa ranked 35th in the country in total properties with foreclosure filings for November. One in every 2,529 Iowa housing units received a foreclosure filing during the month, earning the Hawkeye State a 38th-place ranking among the states.

Polk County, which had 217 properties with foreclosure filings during November, accounted for nearly half of the state’s activity. Scott County was a distant second with 78 such properties. Lee and Pottawattamie counties tied for third with 58 properties. Johnson County came in fourth, documenting 27 properties with foreclosure filings.

Although Polk County (which includes Des Moines) had the most filings overall, Pottawattamie County (part of the Omaha-Council Bluffs metro area) had the highest foreclosure rate in the state, with one in every 674 housing units affected — 3.8 times the state average. Polk County earned the second-place spot with one in every 830 housing units affected — 3.1 times the state average.

National foreclosure filings dropped 7 percent from October to November, but remained 28 percent above the total reported for November 2007. Although some may consider the decrease as a sign of better things to come, James Saccacio, RealtyTrac chief executive, encouraged caution.

“Delinquencies on loans not yet in the foreclosure process jumped to nearly 7 percent in the third quarter, a record high, according to the Mortgage Bankers Association,” he said in a prepared statement. “And more than half of the homeowners who received loan modifications to reduce monthly mortgage payments in the first half of 2008 are already delinquent on their loans again, according to the U.S. Office of Thrift Supervision.”

Foreclosures are also expected to jump in early 2009 because many lending institutions both had a shorter months in November and December due to holiday closings and, being human, few wanted to deliver bad news during the celebratory season.

RealtyTrac’s report incorporates documents filed in all three phases of foreclosure: Default — Notice of Default (NOD) and Lis Pendens (LIS); Auction — Notice of Trustee Sale and Notice of Foreclosure Sale (NTS and NFS); and Real Estate Owned, or REO properties (that have been foreclosed on and repurchased by a bank). If more than one foreclosure document is filed against a property during the month — which is extremely rare — only the most recent filing is counted in the report.

Seventy-five years ago, corn was fetching less than 10 cents a bushel and pork was at three cents a pound. A migrant class of American workers was being created. These were the desperate times of the 1930s known as the Great Depression.

And just like today, mortgage foreclosures were taking land and homes away from citizens.In Iowa, angry mobs violently fought judicial decisions that foreclosed their farms. Just 55 days after President Franklin D. Roosevelt’s inauguration, a group of farmers in northwest Iowa angrily shook the foundations of civilized law when they seized Plymouth County District Judge Charles Bradley from his courtroom, dragged him outside to the courthouse lawn and punched, kicked and slapped him.

The mob, part of the Farmer’s Holiday Association, had been organized the previous year to protest the dire financial situation that was ruining family farms throughout the nation. At their first meeting on May 3, 1932, some 3,000 farmers met to form the bloc.

The “holiday” officially called for a farmer’s strike of withholding produce for sale. They sang:

  Let’s call a Farmers’ Holiday
  A Holiday let’s hold
  We’ll eat our wheat and ham and eggs
  And let them eat their gold.

The association’s leader, Milo Reno, called the strike “the last stand of American agriculture in defense of their rights and their homes.” He claimed the United States had found itself in “the most amazing and confounding situation in the history of the world — people starving in a land with an abundance of food; naked, because of a surplus of clothing; people bankrupt in the richest nation in the world.”

Roads were blocked and fresh milk dumped into ditches during 1932’s infamous “Cow Wars” (also known as the “Milk Wars”) outside Sioux City and Council Bluffs.

In September of that year, the Farmer’s Holiday movement prescribed actions in Tipton to block veterinarians from diagnosing bovine tuberculosis and condemning animals.

With a foreclosure moratorium law in February 1933, the Iowa Legislature attempted to calm violence in rural Iowa by stopping banks from foreclosing on farms unable to cover their mortgages.

The constitutionality of that law was to be challenged in Judge Bradley’s court in Le Mars on that day, April 27, 1933. But before he could hear any arguments, he was charged by more than 100 men in his courtroom.

According to accounts from “A Judge and a Rope” (by George Mills, 1994), “A History of Iowa” (by Leland L. Sage, 1979) and the Chicago Tribune (in the days following the event), Bradley was dragged from the Plymouth County courthouse and refused repeated demands to ignore foreclosure edicts. He was surrounded by an angry and violent mob.

In that public square, he was struck in the face and fell to his knees. The crowd demanded that he agree to stop signing foreclosures, but he refused to disobey his office.

Roughly, the judge was hauled by the mob into the back of a truck and blindfolded. The crowd would be thinned by a change of locale, but unfortunately for the judge, the terror was multiplied.

Dumped a half-mile outside of town, he had a noose placed around his neck. The rope was tossed over an electric light pole, tightened and for an instant the judge was lifted off the ground by his neck.

Again he was asked not to sign foreclosures on farms and this time when he refused his pants were removed, smeared with grease and filled with dirt and gravel.

The 54-year-old judge was crowned with a greasy hubcap and told to get on his knees and pray. Aloud he prayed, “Oh, Lord, I pray thee, do justice to all men.”

Miraculously, this brave prayer seemed to break the will of the mob, and some of the masked men who held the rope got in a car and drove away.

While walking back to town, he was picked up by Rev. J.J. Depree who drove the judge the rest of the way back to town. Judge Charles Bradley escaped with only minor injuries and the need for a wash-up and a change of clothes.

Dr. Thomas Starzl, son of Le Mars Globe Post editor Roman Starzl, was only 7 years old at the time of the almost-lynching. His father was a correspondent for the Chicago Tribune and wrote front-page accounts of the incident for the Trib.

In recalling the incident, Starzl told the Iowa Independent:

“The farmers were on a rampage because they couldn’t get properly paid for milk and for their meat from pigs they were raising, so they had gone on a rampage … They were pouring all their milk out and they had vigilantes on all the roads around Le Mars and any scabs trying to break through and sell the milk had to be roughed up.”

After the incident, Gov. Clyde Herring sent hundreds of troops to quell the farm strikes in Le Mars and Denison. Martial law was imposed in several counties until May 17, only five days after the enactment of the New Deal farm bill, the Agricultural Adjustment Act (AAA). Considered the first farm bill, the AAA paid farmers a subsidy to leave their fields empty.

Starzl again:

“There was a huge National Guard encampment and the city was put under martial law. I remember that extremely distinctly because I had toy soldiers and there were these real soldiers running around with real guns. I was 7 years old.

What was going on was mortgage closings just the same as going on today and ruthless people were coming along buying up these farms for pennies.

This was a dangerous time in this country. It was a dangerous time in Le Mars because it was the center of a real revolt … It was a real uprising.”

Today, the crossroads where Judge Bradley was brutalized is now a housing addition named in his honor by the real estate developer.

Starzl is widely regarded as a pioneer in the field of organ transplantation. The University of Pittsburgh has named the Thomas Starzl Transplantation Institute in his honor and he remains one of the most cited physicians in the world. Now retired, he lives in Pittsburgh, Pa.