In a joint enforcement action by the Consumer Financial Protection Bureau and the Justice Department, the regional bank was asked to pay $18 million to consumers for allowing dealers to charge higher interest rates on auto loans to African American and Hispanic borrowers, regardless of their creditworthiness.
Because of the illegal pricing method, thousands of minority borrowers were charged over $200 more for their auto loans between January 2010 and September 2015.
As a part of the action, Fifth Third Bank, headquartered in Cincinnati, will face new limits on how much dealers can mark up interest rates for consumers.
In a statement, Fifth Third Bank said that it already limits how much dealers can charge and that it will be lowering those caps as part of the enforcement action.
Fifth Third will pay $3 million in relief for credit card customers who were deceptively sold "debt protection products." Consumers were not told that agreeing to learn more about the products meant that they would automatically be enrolled in the services and charged a fee. The bank also will pay a $500,000 penalty.
