^^^7:30 AM ET^^^ JACKSON - Weighs in on auto suits

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ChicSunTimes

Jackson weighs in on finance suits

November 9, 2001

BY ART GOLAB AND GARY WISBY STAFF REPORTERS

If you're black, you'll pay more green at the auto dealership.

That's what the Rev. Jesse Jackson is saying in the wake of several class-action lawsuits filed against auto manufacturers and finance companies.

The lawsuits charge minorities pay more in finance charges and interest for auto loans. But auto finance companies say they only look at a borrower's credit rating, not skin color.

But in press conferences in Chicago on Wednesday and earlier in Detroit, Jackson has said he wants to turn up the heat on auto and finance companies.

"This is the anthrax of economic exploitation," Jackson said. "It's not a matter of risk, it's a matter of race."

In the past, Jackson has won concessions from major auto manufacturers, gaining more dealerships, employment and supplier contracts for minorities.

But this is different, he says.

"We never appreciated the role of the finance schemes of those companies," Jackson said. "Police profiling is just scratching the surface. It is the economic race profiling and predator schemes that are the most exploitative."

According to court papers filed in suits against Nissan Motor Acceptance Corp., blacks with the best credit records paid $360 more in dealer-imposed "discretionary markup fees" than whites with similar credit ratings.

Black borrowers with the worst credit ratings paid $327 more than whites with similar ratings, according to a study based on numbers provided by Nissan to the plaintiffs.

"When we look at a customer within the same credit tier we consistently find the markup is higher for African-American borrowers than Caucasian borrowers," said Ian Ayres, a Yale Law School professor and economist who is consulting with the plaintiffs in the case.

Nissan, however, has fielded its own expert economists, who reviewed the data and "found absolutely no evidence of any illegal discrimination," according to a company statement.

"We do not discriminate against any of our customers, and we do not charge one group of people more than any other," said spokeswoman Dierdre Dickerson.

She added that Nissan does not know the race of its credit applicants and that it has no control over dealer markups.

The suits against Nissan were filed three years ago in Nashville, but kept secret until last October when two news organizations petitioned a federal court to unseal the cases. Since then, similar suits have been filed against the financing arms of Ford, DaimlerChrysler and Toyota.

The latest suit was filed this week on behalf of a Gary, Ind., woman, alleging that an independent Indianapolis finance company encouraged auto dealers to tack on surcharges to minority borrowers.

"I had good credit," said the plaintiff, Lindah Wise, an African-American woman. "I did not understand why I was charged 18 percent."

Jackson said he has already had talks with Ford, General Motors and BMW and plans discussions with Nissan and 10 other manufacturers.

"So far the auto companies are blaming each other and their dealers," Jackson said. "There's a lot of buck passing, but as the data comes in they cannot outright deny this."

Jackson called for laws imposing caps on dealer financing markups, and said that in Arkansas and Michigan, where such caps are in place, there is less abuse.

Meanwhile, Ayres advises buyers to check other sources of financing before turning to auto dealers. "The dealership offers the convenience of one-stop shopping, but if you make a mistake, there's so many hundreds and thousands of dollars involved, you're better off getting competitive bids."

-- Anonymous, November 09, 2001

Answers

Imo, this is another shakedown scam by Jackson. It's been in the news before where Jackson threatened lawsuits (trumped up charges) against large corporations, but then dropped the lawsuits as soon as a suitable "donation" was made to his family members or the Rainbow Coalition.

The man is a schmuck and crooked as a backwoods road.

-- Anonymous, November 09, 2001


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