FTC Accuses Asbury Automotive of Discriminating Against Black & Latino Consumers
Published: August 18th, 2024
The U.S. Federal Trade Commission (FTC) has taken significant action against Asbury Automotive Group, accusing the large automotive retailer of discriminatory lending practices that have unfairly targeted Black and Latino consumers. The FTC’s investigation, which has brought these practices to light, claims that Asbury systematically charged these consumers higher interest rates and additional fees, leading to inflated costs for auto loans compared to their white counterparts.
According to the FTC, these discriminatory actions were not isolated incidents but part of a broader pattern within Asbury’s operations. The agency alleges that Asbury utilized subjective and opaque criteria to determine loan terms, allowing for racial and ethnic biases to influence lending decisions. As a result, Black and Latino consumers were routinely offered less favorable loan terms, even when their creditworthiness was comparable to other consumers.
The FTC’s investigation uncovered that thousands of consumers were impacted by these practices, leading to significant financial harm and exacerbating economic disparities within these communities. The agency is now seeking remedies that include monetary compensation for the affected consumers and mandatory changes to Asbury’s lending practices to prevent further discrimination.
This legal action by the FTC is part of a broader initiative to address and eliminate discriminatory practices in the auto lending market, which has long been a concern for consumer protection advocates. The agency’s efforts are focused on ensuring that all consumers, regardless of race or ethnicity, receive fair and equal treatment in the auto lending process. By holding Asbury accountable, the FTC aims to set a precedent within the industry, encouraging other companies to reevaluate their lending practices and ensure compliance with anti-discrimination laws.
In response to the FTC’s allegations, Asbury Automotive Group has issued a strong denial, labeling the claims as “unfounded.” The company insists that its lending practices are transparent and consistent with industry standards, rejecting the notion that they engaged in any discriminatory behavior. Asbury’s CEO, David Hult, has emphasized that the company is committed to treating all customers fairly and equally. He also expressed concern that the FTC’s actions could create a competitive disadvantage in the industry, potentially affecting Asbury’s reputation and financial standing.
Asbury Automotive Group, which operates a vast network of dealerships across the United States, is preparing to contest the FTC’s charges in court. The company is determined to defend its track record of customer service and compliance with financial regulations, standing by its lending practices as lawful and ethical.
This case serves as a critical reminder for consumers to be vigilant when securing auto loans. The FTC advises consumers to thoroughly review loan terms, compare multiple offers, and seek clarity on any terms that seem subjective or unclear. Consumers who believe they have been victims of discriminatory practices are encouraged to file a complaint with the FTC, which continues to work toward ensuring fairness and equity in the marketplace.
The outcome of this case could have far-reaching implications for how auto loans are offered and managed across the country. As the legal proceedings unfold, both the automotive industry and consumers will be watching closely to see how the courts address these serious allegations of discrimination.