Economy

Toyota's China auto finance company fined

(Xinhua)
Updated: 2010-09-21 07:10

HANGZHOU, Zhejiang - Officials from a local administration for industry and commerce in Hangzhou, capital of East China's Zhejiang province, said Monday it has fined Japanese carmaker Toyota's auto finance unit in China for involvement in commercial bribery.

Related readings:  Official calls for laws against intl graft  China issues new rules to curb corruption in government drug purchases  Senior official calls for greater efforts against commercial bribery  Former anti-graft official sentenced

This is the first commercial bribery fine for both Toyota Motor Finance (China) and Toyota Motor Corp, the agency said in a statement.

Toyota Motor Finance (China) Co. offered rebates to encourage three dealers to have customers take loans from Toyota, rather than from local banks, between August 2008 and April 2010, it said.

An investigation showed the one-year leading rate at Toyota Motor Finance (China) Co. was 10 to 13 percent, compared with less than 7 percent at major state-owned commercial banks, it was revealed.

Officials said Toyota Motor Finance (China) Co. offered 4.5 percent of interest earnings as rebates to the three dealers.

The auto finance company illegally took in 426,352 yuan ($63,493) from 49 borrowers after business taxes, officials said.

The agency said it would confiscate all illegal earnings and impose a fine of 140,000 yuan.

Toyota Motor Finance (China), a subsidiary of Toyota Financial Service, was also under a similar commercial bribery investigation in Ningbo City, also in Zhejiang. Toyota Financial Service is the wholly owned car-loan financing firm of Toyota Motor Corp.