8/20/2023 0 Comments Ally bank autoDistrict Court for the Eastern District of Michigan in conjunction with the DOJ’s complaint. Ally’s settlement with the DOJ, which is subject to court approval, was filed today in the U.S. The Equal Credit Opportunity Act (ECOA) prohibits such discrimination in all forms of lending, including auto lending. The average victim paid between $200 and $300 extra during the term of the loan. The agencies claim that Ally charged borrowers higher interest rates because of their race or national origin, and not because of the borrowers’ creditworthiness or other objective criteria related to borrower risk. The settlement resolves claims by the department and the CFPB that Ally discriminated by charging approximately 235,000 African-American, Hispanic and Asian/Pacific Islander borrowers higher interest rates than non-Hispanic white borrowers. And it will reinforce our determination to respond aggressively to discrimination in America’s lending markets – wherever it is found.” It will enable the Justice Department and the CFPB to work closely with Ally and others to prevent discriminatory practices in the future. “By requiring Ally to provide refunds to those who are overcharged because of their race or national origin, this agreement will ensure relief for Americans who are victimized. “With this largest-ever settlement in an auto loan discrimination case, we are taking a firm stand against discrimination in a critical lending market,” said Attorney General Eric Holder. This system will create a strong financial incentive to eliminate discriminatory overcharges. Ally also must refund discriminatory overcharges to borrowers for the next three years unless it significantly reduces disparities in unjustified interest rate markups. The settlement provides $80 million in compensation for victims of past discrimination by one of the nation’s largest auto lenders and requires Ally to pay $18 million to the CFPB’s Civil Penalty Fund. With this agreement, eight of the top 10 largest fair lending settlements in the department’s history have been under Attorney General Eric Holder’s leadership. The agreement is the first joint fair lending enforcement action by the department and CFPB. and Ally Bank have engaged in an ongoing nationwide pattern or practice of discrimination against African-American, Hispanic and Asian/Pacific Islander borrowers in their auto lending since April 1, 2011. The Department of Justice and the Consumer Financial Protection Bureau (CFPB) today announced the federal government’s largest auto loan discrimination settlement in history to resolve allegations that Detroit-based Ally Financial Inc.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |