The California-based financial unit of Toyota Motor Corp. has agreed to pay up to $21.9 million in compensation over alleged discrimination against some ethnic groups taking out auto loans through car dealerships, the U.S. Justice Department said Tuesday.
In July, the department leveled a similar allegation against Honda Motor Co. in the U.S. The case resulted in a $24 million compensation deal.
Toyota Motor Credit Corp. said it “respectfully disagrees” with the department and the Consumer Financial Protection Bureau over the determination that industry lending practices were discriminatory but is committed to ensuring that consumers can count on fair auto loans.
According to the department, Toyota Motor Credit charged thousands of African-Americans, Asians and Pacific islanders higher interest rates than non-Hispanic whites.