Reforming CFPB Indirect Auto Financing Guidance Act

Floor Speech

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Mr. ELLISON. I want to thank the gentlewoman for the time. The ranking member has been an outstanding advocate for American consumers, and I thank her.

I rise today to ask people to vote ``no'' on this piece of legislation and to alert the American people of another attempt to make it easier to overcharge you when you make a purchase.

Today's threat to Americans' wallets occurs when you try to buy a car. Most people need to take out a loan to buy a car or a truck. They frequently get their financing through an auto dealer.

Car buyers don't realize that some dealers can raise the price or the interest rate offered by the partnering bank to make an additional profit.

For years, there has been a concern that African Americans and Latinos, despite negotiating harder and having good credit scores, pay a higher interest rate than white car buyers, charging some people 2 or 2.5 more percent than others, based on skin color.

It is also a violation of the law. The Equal Credit Opportunity Act prohibits discrimination in the financial marketplace. Lenders who partner with auto dealers have a responsibility to ensure that borrowers receive fair treatment. That is what the Consumer Financial Protection Bureau is trying to do.

The CFPB issued guidance recommending that the auto industry establish flat-rate pricing and some other approach to ensure that they are not discriminating against their customers. This makes sense to me and would be beneficial to consumers.

This bill, on which I urge a ``no,'' nullifies the CFPB's guidance. It requires the bill to jump through a number

of hoops that open the Bureau up to litigation before the CFPB can establish new guidance.

The National Association of Minority Auto Dealers opposes this bill. They say: ``To date, the recent consent orders between the CFPB, DOJ and financial institutions and captive finance companies to settle discrimination claims have not resulted in any negative outcomes or loss of revenue for minority dealers. We are convinced that this matter should and, more importantly, can be resolved with a nonlegislative fix.''

Mr. Chairman, I say thank you to them.

When people are overcharged or treated unfairly in the marketplace, it harms their ability to build wealth and fully participate in this economy. If you want to do something about income inequality, you must say ``no'' to this bill.

Join the National Association of Minority Auto Dealers, the National Association for the Advancement of Colored People, the Center for Responsible Lending, the Consumers Union, Consumer Action, the National Council of La Raza, Americans for Financial Reform, American Association for Justice, ColorOfChange, Leadership Conference on Civil Rights and Human Rights, the Urban League, and more to vote ``no'' on this legislation.

I include in the Record the National Association of Minority Automobile Dealers' letter opposing this legislation and the NAACP's letter opposing this legislation.

I just want to point out that discrimination in this country has been fought long and hard for centuries. Let's not stop now.

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