A report by Mark Cohen, a professor at Vanderbilt University, claims that black car buyers consistently paid more in auto loan markups than white customers when financing through American Honda Finance Corp. His findings are based on studying 383,652 Honda Finance contracts from June 1999 to April 2003.

Cohen has been hired as an expert witness by plaintiffs' lawyers in a class-action suit against Honda Finance and several other captive finance companies. He conducted similar studies of General Motors Acceptance Corp., Nissan Motor Acceptance Corp. and Ford Motor Credit Co.

Cohen said the study controlled for factors such as loan term, vehicle type and borrowers' creditworthiness.

Although the dealers set the customers' loan rates, the report said Honda Finance's markup cap policy "aggravates the disparity and especially disadvantages those who can least afford it." It lets dealers charge a 2 percent maximum markup to most customers but a 3.5 percent maximum markup to new-car buyers in the lowest credit tier.

"There appears to be no business justification for this differential markup policy," said Cohen.

According to the report, 43.3 percent of black borrowers are charged a markup, compared to 22.2 percent of white borrowers. It also claimed black borrowers paid more than twice as much as white borrowers in subjective markups -- $557 versus $227.

Honda said in a statement that it doesn't tolerate discrimination by its dealers against customers or credit applicants.