Feds: Black and Hispanic Motorcycle buyers faced racial discrimination, inflated interest rates by Evergreen bank and dealers

Motorcycles seem to conjure up a feeling of independence and convey that image of the wind in your face and the freedom of the open road.

But for some that image was tainted amidst allegations of racial discrimination and financial exploitation.

That's because one of the largest motorcycle financing banks in the country systematically discriminated against thousands of African-American and Hispanic customers, overcharging borrowers inflated interest rates -- rates that were not based on credit-worthiness or any measure of risk according to federal authorities.

Evergreen provides thousands of motorcycle loans through 400 motorcycle dealers located in all 50 states, including Arizona.

Government prosecutors say Evergreen’s policies and practices allowed dealers to mark up interest rates on motorcycle loans in a hidden manner and not based on the borrower’s credit-worthiness or other objective criteria related to borrower risk.

From at least January 2011 to March 2014, Evergreen, through its FreedomRoad Financial operations, charged 1,500 Hispanic borrowers and 700 African-American borrowers higher interest rates for their motorcycle loans because of their national origin or race, the complaint alleges.

The average victim was obligated to pay over $200 more during the term of their loan. 


The feds say Evergreen kept part of the profits it earned from the inflated interest rates they charged Hispanics and African-Americans and it paid the remainder to the motorcycle dealers. 

The DOJ declined to identify the dealers who got paid.

As a result of their policies and procedures, prosecutors say Evergreen created financial incentives for dealers to mark up borrowers’ interest rates above those established based on the consumer’s credit-worthiness or other objective criteria related to borrower risk.

The government says Evergreen's actions violated the Equal Credit Opportunity Act or ECOA .