American Honda Finance Corp, the U.S. lending arm of carmaker Honda Motor Co Ltd, said on Tuesday that American law enforcement agencies are preparing to charge the finance company with discriminatory pricing of loans made through auto dealerships.
The U.S. Department of Justice and the Consumer Financial Protection Bureau have authorized an enforcement action against American Honda Finance Corp for violating laws that prevent lenders from charging certain borrowers higher interest rates, the company said in a filing with the U.S. Securities and Exchange Commission.
The agencies are seeking fines or consumer relief as well as changes to the lender's pricing practices and policies, but they could defer bringing the action if the company agrees to a "voluntary resolution" of the accusations, according to the filing.
American Honda Finance Corp's disclosure comes shortly after Toyota Motor Credit Corp, the U.S. lending arm of Toyota Motors Corp, received a letter from the Justice Department and the CFPB accusing it of similar practices.
A CFPB spokesman declined to comment. A spokeswoman for the Justice Department did not immediately respond to a request for comment.
The company said in the filing that it is cooperating with the agencies and looking to find a "mutually agreeable resolution."
In December 2013, Ally Financial Inc was ordered to pay $98 million to resolve similar accusations from the Justice Department and the CFPB.
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