Honda Financial Services provides financing for automobiles and power equipment. Its products include Honda or Acura vehicles, motorcycles, auto parts, and accessories. It also offers a range of special offers such as the Honda or Acura College Graduate program that provides flexible auto financing for new and returning college graduates. Honda Financial Services is a wholly owned subsidiary of American Honda Motor Corporation. The company was founded in 1980.
Honda to pay $24 million in compensation for past discrimination: The Justice Department and the Consumer Financial Protection Bureau today settled a lawsuit against Honda Financial Services Corporation (Honda) that alleges it violated the Equal Credit Opportunity Act by permitting car dealers to mark-up consumers’ interest rates on Honda auto loans in violation of the law. The complaint alleges that the mark-ups resulted in thousands of African-American, Hispanic, and Asian and Pacific Islander borrowers paying on average $150 to over $250 more than non-Hispanic white borrowers for their auto loans. Honda will pay a total of $24 million in compensation to victims and to address the underlying discrimination in its lending practices.
As part of the settlement, Honda will change its lending practices by significantly limiting dealer markup on its auto loans. The company will also establish a fund to locate and distribute payments of compensation to eligible borrowers. The administrator of the fund will be selected shortly, and the department and CFPB will make a public announcement when more details are available. Honda will also improve its monitoring and compliance systems, and commit to experiment with different approaches toward lessening discrimination in auto financing. honda financial services customer service