Fifth Third Bancorp Faces Probe Over Auto-Lending Practices

By Andrew R. Johnson 

Fifth Third Bancorp is facing a Justice Department investigation over whether it engaged in discriminatory auto-lending practices, the bank said Thursday in a regulatory filing.

The Cincinnati lender said it is cooperating with the investigation of the bank's "indirect automobile loan portfolio."

Such loans are provided by lenders to consumers through auto dealerships.

A spokesman for Fifth Third declined to comment.

The Justice Department and Consumer Financial Protection Bureau have been investigating whether lenders' practices have led to discrimination against women and minorities. The probes focus in part on a practice in which auto dealers can mark up the rates offered on loans to consumers, known as a dealer participation fee.

Regulators have stressed that lenders can be held responsible for such practices if it leads to discrimination against borrowers.

Ally Financial Inc. in December agreed to pay $98 million in a settlement with the Justice Department and CFPB over allegations that it discriminated against borrowers. The company didn't admit wrongdoing.

--Alan Zibel contributed to this article.

Write to Andrew R. Johnson at [e-mail]

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