CFPB investigates Honda's financing department

bloomberg news

WASHINGTON—Honda's finance division is facing an investigation by the Consumer Financial Protection Bureau, the auto finance division announced. Regular regulatory filings.

American Honda Finance Corporation, which is wholly owned by Honda, announced Friday that it received a “civil investigative request” from the CFPB in November. The investigation relates to the “provision of credit reporting information regarding consumer accounts” by the financial sector.

The company is cooperating with the agency, but says it is unable to predict the ultimate scope, duration or outcome of this investigation and cannot estimate the amount or extent of potential losses, if any, at this time. ” he said.

The CFPB declined to comment. American Honda Finance did not respond to a request for comment.

This investigation coincided with the CFPB's crackdown on another auto finance company, Toyota Motor Credit.

CFPB in November Toyota's auto finance division ordered to pay $60 million The agency delayed and withheld refunds to customers, made it difficult to cancel unwanted additional products, and reported false information about consumers to credit bureaus, according to the CFPB's consent order. Because it turned out.

CFPB Director Rohit Chopra said at the time, “Given the increasing burden of American auto loan payments, we will continue to pursue major auto lenders that deceive their customers.”

The enforcement action against Toyota is the CFPB's first settlement with an auto finance company since July 2022, when it issued a consent order to Hyundai's U.S. financing arm.In that episode, the station Fined Hyundai Capital America more than $19 million for submitting false information about consumers to credit reporting agencies..

Honda's finance department ran into trouble with the CFPB in 2015. Reached $24 million settlement with auto lender after affiliated auto dealership issued loans to minorities at unfairly high interest rates.