LOS ANGELES—Honda Motor Co. reached a settlement Tuesday to resolve allegations that the company discriminated against minority car buyers by marking up interest rates on loans, a practice industry experts describe as common because of the discretion given to individual dealerships.
Honda’s settlement with the U.S. Department of Justice is subject to court approval and was filed in federal court in Los Angeles. Honda’s U.S. operation is based in nearby Torrance, California.
The Justice Department and the Consumer Financial Protection Bureau accused Honda dealers of charging higher interest rates to thousands of black, Hispanic, Asian, and Pacific Islander customers than they did to white car buyers. Those minority customers paid an average of between $150 and $250 more during the terms of their loans, the Justice Department said.
