WASHINGTON — The U.S. Department of Justice filed a lawsuit this week alleging that Guaranteed Auto Sales, a used-car dealership in Glen Burnie, Md., along with its owner and manager, Kelly Ann West and Robert Chesgreen, violated the federal Equal Credit Opportunity Act by offering different terms of credit based on race to those seeking to finance vehicle purchases.

The lawsuit is based on the results of testing conducted by the department’s Fair Housing Testing Program, in which individuals pose as prospective car buyers to gather information about possible discriminatory practices.

“The Justice Department is acting to ensure that all individuals are treated equally regardless of their race as they seek information about auto financing terms and apply for credit.”

The complaint, which was filed in the U.S. District Court for the District of Maryland, alleges that defendants engaged in a pattern or practice of discrimination by offering less favorable auto loan terms to African American testers than white testers.

Most significantly, the complaint alleges that employees of Guaranteed Auto Sales told African American testers that they needed larger down payments than white testers for the same used cars. African American testers also were told they were required to fund their down payments in one lump sum, while white testers were offered the option of paying in two installments. 

“Using race as a factor in determining credit terms, including the amount of down payment that a customer must pay, is despicable and illegal,” said Eric Dreiband, assistant attorney general for the DOJ’s Civil Rights division. “By filing this lawsuit, the Justice Department is acting to ensure that all individuals are treated equally regardless of their race as they seek information about auto financing terms and apply for credit.”

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