Toyota has agreed to a $7.6 million settlement in Massachusetts over allegations that it was involved in illegal loan collection practices.
Massachusetts Attorney General Andrea Joy Campbell claimed that Toyota Motor Credit had failed to provide select consumers with sufficient information about the calculation methods for deficiencies left on their auto loans after their vehicles were repossessed.
Read: Toyota Says Data Proves EV-Only Policy Is Worse For The Planet
While Toyota Motor Credit has denied wrongdoing, it has decided to reach a settlement. Of the $7.6 million, some $5.5 million will be provided in debt relief to more than 500 Massachusetts consumers. At the same time, the remaining funds will pay for the investigation, costs, and administrating of the agreement, and some direct payments to borrowers.
“The company strives to consistently follow all state laws in our sales, customer service, and administrative practices,” the carmaker’s finance arm said in a statement issued to Auto News. “In settling with the state of Massachusetts, TMCC admits to no wrongdoing. In 2018, TMCC revised our post-repossession notices to comply with the court’s interpretation of the state statute.”
The Attorney General also alleged that Toyota Motor Credit made excessive collection calls to certain consumers in violation of Debt Collection Regulations.
“Consumers facing repossession and collection actions on their vehicles deserve clear and transparent information from auto lenders,” Attorney General Campbell said. “It is our hope that the debt waiver and funds secured through this settlement will assist hundreds of residents in getting the relief they need and deserve – and build on our efforts to provide economic opportunity to families across Massachusetts.”
