JP Morgan & Bank of America Charged Blacks More for Car Loans
Two major banks are discussing possible settlements of class action
lawsuits filed by black consumers who contend they were charged more
for auto loans than whites, according to a published report. Any
settlement could affect the price of loans taken by millions of auto
buyers, although no agreement appears to be near, The Wall Street
Journal reported Monday, citing people familiar with the talks.
Plaintiffs attorneys are asking the banks, Bank of America Corp. and
J.P. Morgan Chase & Co.'s Bank One unit, to limit how much auto
dealers can add onto the financing rates both banks charge, the
newspaper reported. The lawsuits contend that dealers boost the cost of
the loans more for black borrowers than for whites, and that the banks'
policies allow for such discrimination. Bank of America declined to
comment Monday to The Associated Press. A company spokeswoman, Shirley
Norton, told the newspaper that the bank was "in talks" about the case,
but declined to characterize the discussion as settlement talks or
describe how far they had progressed. Tom Kelly, a spokesman for J.P.
Morgan Chase in Chicago, said: "We are in discussions with plaintiffs'
attorneys to resolve the litigation." The Journal said any settlement
could lead to cheaper loans for all car buyers by curbing industry
practices that - beyond the discrimination allegations - are legal in
most states and burnish the dealers' bottom lines. [more]