United States v. Toyota Motor Credit Corp. (C.D. Cal.)

On February 2, 2016, the United States filed a complaint and consent order in United States v. Toyota Motor Credit Corp. (C.D. Cal.) that resolves the pattern or practice lawsuit against the nation’s largest captive auto lender. The complaint alleged that TMCC is responsible for African-American and Asian/Pacific Islander borrowers paying higher dealer markups based on race and national origin since January 2011 in violation of the Equal Credit Opportunity Act. The consent order provides $19.9 million in compensation for borrowers who took out loans between January 2011 and January 2016 and paid higher markup based on the alleged discrimination.  Additionally, Toyota will pay up to $2 million to African-American and Asian/Pacific Islander borrowers with markup disparities while Toyota is preparing to implement the new policies. The consent order requires the defendant to also implement lower dealer markup caps. This matter was the subject of a joint DOJ/CFPB investigation and an eventual referral from the CFPB.  The court entered the consent order on February 11, 2016.