American Honda Finance found guilty of illegal discrimination

Article by Christian Andrei, on December 6, 2014

The Consumer Financial Protection Bureau and United States Department of Justice have found American Honda Finance Corp. (AHFC) responsible for illegal discrimination in pricing auto loans, the company said in filing with the US Securities and Exchange Commission.

The company also disclosed in the filing that it may face sanctions until it settles with the federal agencies. American Honda Finance Corp. is similar to a move by Toyota Motor Credit Corp. on Nov. 28. Both captive finance companies said in 2013 that the federal agencies had asked information regarding auto loans.

AHFC said that it a notice that the Agencies have authorized enforcement actions against the captive finance unit, alleging discrimination in auto loan pricing to certain borrowers by dealers and alleging the loan pricing disparities were caused by the company’s business practices related to dealers.

AFHC said the agencies may not pursue the case if it works with them to seek a “voluntary resolution.” According to AHFC, the federal agencies want monetary relief for customers as well as changes in its pricing policies.

In 2013, the Consumer Financial Protection Bureau disclosed that auto lenders were to be blamed for higher rates for dealer reserve for legally protected classes of borrowers like minorities and women. The bureau said auto lenders made those higher rates possible by allowing dealerships to impose customers with similar credit histories different rates.

Topics: honda

If you liked the article, share on:

Comments

Login or Create new account to add a comment!

Recommended

Hyundai is making the green vehicle race more competitive by offering three powertrain types -- pure electric (EV), hybrid (EV plus combustion engine) and plug-in hybrid (PHEV) – in one...
by - December 9, 2016
Although specs for the new Renault Megane had already surfaced several weeks ago, we didn’t know that the company has cooked up something new. Aside from the 200hp gasoline, Renault‘s...
by - December 9, 2016
For the first time in fifty-eight years, Infiniti registers its first US-Spec Q60 Coupe in Cuba. American products have not been allowed entry into Cuba for six decades. But it...
by - December 9, 2016
Chevrolet has already given out the pricing for some of its 2018 Equinox models. Not only will the new Equinox be available in both the US and Canada, it is...
by - December 9, 2016
Nearly all details have been set with regards to the upcoming market introduction of the new Jaguar I-Pace. Its production version was recently previewed at the 2016 Los Angeles Auto...
by - December 8, 2016
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries