Car loan lender ordered to pay reservation residents

LAS VEGAS – A car loan lender made an agreement with the federal government to give $170,000 to 34 people in damages stemming from a government complaint alleging the lender rejected loan applicants because they lived in Indian reservations.

The consent order filed at the U.S. District Court of Nevada Sept. 30 originated from claims that Nationwide Nevada of Las Vegas and its parent company, Nationwide Acceptance Corp., violated the Equal Credit Opportunity Act by rejecting applicants at various car dealerships in Nevada and Utah from at least January 2003 through July 2005, according to the order.

On its Web site, Nationwide Acceptance boasts to be one of the largest independently owned finance companies in the nation. The Chicago-based corporation contends it was unaware of discrimination practices and did not condone it, according to the order.

“Our company has a strong commitment to fair credit lending. We regret that two of our loan officers had misinterpreted our policy with respect to a small number of applicants. We look forward for the matter to be resolved,” Nationwide Acceptance President Martin Less said in a telephone interview.

No evidence supporting the government’s claims was considered in the agreement; rather, both parties reached the accord to avoid a protracted and costly litigation, according to the order. The order is not a declaration that the lender violated the ECOA.

“The consent order settled legal matter. Both parties agreed to terms of consent decree, but it still has to be approved by the court,” said Scot Montrey of the U.S. Department of Justice Civil Rights Division.

In addition to the monetary damages, Nationwide Acceptance must modify its written nondiscrimination credit policy to include that residency at reservations will not be a valid basis for rejection. It must establish and pay for a credit opportunity training program for its employees. And the company must give access to application records to the U.S. and submit reports for the next two years.

Montrey declined to provide any specific details of the cases. Many of the cases likely involved applicants living in at least the five reservations that were listed as recipients of the order. They include Nevada’s Yerington, Fallon Paiute-Shoshone and Pyramid Lake reservations and Utah’s Uintah and Ouray reservations. The damages will be disbursed in payouts amounting to as much as $10,000 for some claimants.