U.S. Government Uses Race Test for $80 Million in Payments

Wall Street Journal ^ | October 29, 2015 | ANNAMARIA ANDRIOTIS and RACHEL LOUISE ENSIGN

[reaganaut1]

By the end of this week, the U.S. government will be a step closer to sending out millions of dollars to minority borrowers who were allegedly discriminated against by auto lender Ally Financial Inc. But there is a potential hitch: No one knows for certain whether all the people getting the checks will actually be minorities.

The attempt to sort that out is the end result of a unique settlement in which Ally agreed to pay borrowers at least $80 million to settle allegations of racial or ethnic discrimination, even though the lender is prohibited by law from collecting data on the race or ethnicity of its borrowers.

Ally, formerly known as GMAC and spun off from General Motors in 2006, didn’t admit or deny wrongdoing as part of the 2013 settlement focused on “dealer markups.” In a statement, Detroit-based Ally said it “does not engage in or condone violations of law or discriminatory practices, and based on [its] analysis…it does not believe that there is measurable discrimination by auto dealers.”

...

To find minority borrowers, the U.S. Consumer Financial Protection Bureau and Justice Department opted to essentially make educated guesses using an algorithm that assigns probabilities to whether borrowers are minorities based on their last names and locations.

They have been sending letters in recent months to Ally customers they believe were overcharged based on the results. One version of the letter, sent to borrowers that the CFPB estimates have at least a 95% probability of being minorities, tells recipients that they qualify for a payment and don’t need to do anything more. It asks borrowers to write back if they aren’t minorities.

[cherry]

this is the new norm....breaking every civil right to give special money or access or privilege to "minorities"....

do not expect the justice system to make this right...

the govt in its whole will protect itself....

which is why, if you are attacked by a mob of "minorities" somehow, someway, you'll be the culprit...

[minnesota_bound]

The law firms will get the money.

[NativeSon]

This is setting up the auto-loan version of the mortgage crises.

Cry discriminatory lending practices, force lenders to give loans to people that have zero security, no work history and no intent on paying the loans back.

Cry r@cism if anyone sees how crazy/damaging the practice is.

When the scheme falls apart, cry "predatory lending"!, the Fed gov comes in, makes rules, takes more control of another sector of business, distributes payment, er, checks to all those poor,poor victims, wink & nod.

Pepeat