VWFS Settles Agreement: What You Need to Know
Volkswagen Financial Services (VWFS) has recently agreed to a $17 million settlement with the Consumer Financial Protection Bureau (CFPB) over allegations of deceptive and discriminatory lending practices. The settlement comes after an investigation found that VWFS had violated the Equal Credit Opportunity Act by charging higher interest rates to minority borrowers.
If you`re a VWFS customer or are planning to finance a Volkswagen vehicle, here`s what you need to know about the settlement:
1. VWFS will pay $10 million in restitution to affected borrowers.
Under the terms of the settlement, VWFS will pay $10 million in restitution to borrowers who were charged higher interest rates based on their race or ethnicity. The CFPB will identify eligible borrowers and distribute the funds accordingly.
2. VWFS will pay $7.5 million in penalties to the CFPB.
In addition to the restitution, VWFS will pay $7.5 million in penalties to the CFPB. The penalties are meant to deter future violations of the Equal Credit Opportunity Act.
3. The settlement affects borrowers who financed Volkswagen vehicles between 2011 and 2016.
The CFPB`s investigation focused on VWFS`s lending practices between 2011 and 2016. If you financed a Volkswagen vehicle during that time period, you may be eligible for restitution.
4. VWFS denies any wrongdoing.
Despite agreeing to the settlement, VWFS denies any wrongdoing. In a statement, the company said that it „disagrees with the Bureau’s allegations, and does not believe that it engaged in any intentionally discriminatory conduct.”
5. The settlement highlights the importance of fair lending practices.
The VWFS settlement is a reminder of the importance of fair lending practices. Discrimination based on race, ethnicity, gender, or any other protected characteristic is illegal, and lenders have a responsibility to ensure that their lending practices comply with the law.
If you believe that you were unfairly charged higher interest rates by VWFS, or any other lender, you may be able to take legal action. Contact a qualified attorney or financial advisor for guidance.