The Consumer Financial Protection Bureau and Department of Justice yesterday resolved an action with American Honda Finance Corporation concerning discretionary auto loan pricing and compensation practices.
The CFPB explains: "Honda’s past practices resulted in thousands of African-American, Hispanic, and Asian and Pacific Islander borrowers paying higher interest rates than white borrowers for their auto loans, without regard to their creditworthiness. As part of today’s order, Honda will change its pricing and compensation system to substantially reduce dealer discretion and minimize the risks of discrimination, and will pay $24 million in restitution to affected borrowers."
The CFPB's full press release is here.
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