On July 15, the Consumer Financial Protection Bureau (“CFPB”) and the Department of Justice (“DOJ”) announced that claims concerning an indirect auto finance company’s alleged discriminatory lending practices were settled as part of a consent order requiring $24 million in restitution payments to borrowers and changes to the lender’s dealer compensation system. The consent order alleges that the company violated the Equal Credit Opportunity Act (“ECOA”) by permitting dealers to charge higher interests rates on car loans to borrowers on the basis of race and national origin. Specifically, the company allegedly allowed dealers to charge a “dealer markup” on top of the risk-based interest rate that increased rates as much as 2.25 percent for contracts lasting 5 years or less and 2 percent for contracts with longer terms. The consent order alleges that this discretion resulted in minority borrowers being charged higher dealer markups than similarly situations non-minority borrowers. As part of the consent order, the company has agreed to cap the dealer markup amount to only 1.25 percent for contracts lasting 5 years or less and 1 percent for contracts with longer terms. The company must also administer and distribute the restitution funds to those affected by the alleged lending practices. The action, which is part of a larger effort to address discrimination in the indirect auto lending market, arose out of a joint investigation conducted by the CFPB and the DOJ initiated in April 2013.