The company offers auto financing, leasing and a variety of service contracts for Honda and Acura vehicles. It also sells motorcycles, power equipment and related accessories. Its customers include auto dealers, car rental companies and consumers who purchase their products through retail installment sales contracts and leases. Its customers can contact customer support by phone, email or through online chat.
In addition to the $24 million in payments to victims, Honda will also establish a new fund to provide additional financial education and other outreach to help consumers make smarter vehicle purchases and avoid predatory practices. The company will also improve its monitoring systems to prevent future discrimination and ensure that all borrowers receive the best possible deal.
honda financial services customer service violated the Equal Credit Opportunity Act when it allowed car dealers to charge thousands of African-American, Hispanic and Asian/Pacific Islander borrowers higher dealer markups on their auto loans than non-Hispanic white borrowers. The higher markups inflated loan prices without regard to the borrowers’ creditworthiness. On average, victims of the discrimination were obligated to pay over $250 more for their auto loans than were victims of non-discriminatory lending.
The Justice Department and the CFPB are working with an administrator to locate and distribute compensation to eligible borrowers. To learn more about how to participate in the victim compensation process, please visit the Department’s website. Honda is also limiting the ability of its car dealers to charge interest rate markups on its auto loans, which will further reduce discrimination against African-American, Hispanic and Asian/Pacific islander borrowers. It is the first time that a major indirect auto lender has agreed to take such action. The settlement is subject to court approval.