Taxi Medallion Loans Ruined Thousands While Banks and Brokers Cleaned Up

An investigation by The NY Times found that the price of a taxi medallion jumped from $200,000 to more than $1mn and forced thousands to take out loans they could not afford to pay back; there were 7 government agencies who opened investigations or did a report on the rising issue; none of that mattered since the warning signs were ignored and the market eventually collapsed in 2014; thousands of immigrant drivers lost everything, some committed suicide, 950 filed for bankruptcy and many are still trying to work their way back today; a small group of banks and brokers were on the other end making boatloads of money pushing the risky loans; their last 3 mayors all put political allies in the Taxi and Limousine Commission to ensure the sale of medallions to balance budgets and fund projects; the market had many of the same hallmarks of the mortgage crisis including inflating prices, large fees and forfeiture of legal rights; even after the market collapsed loan terms were not softened and officials placed the blame on ride sharing services. Source.

  • Todd is the host of PitchIt: the fintech startups podcast, a weekly interview show featuring emerging fintech founders and leading venture capitalists. He is responsible for leading the content team which covers fintech through daily & weekly email newsletters, editorial, virtual events, and in-person conferences. He has been covering fintech, banking, and venture capital for more than 15 years, including speaking regularly at industry events.

Sign up for our Newsletters

Every morning the Fintech Nexus News team scours the globe for the most important fintech stories of the day in the daily Global newsletter.

The Europe edition comes out on Monday, Wednesday, and Friday featuring the most important stories in European and UK fintech.

The Latin American newsletter arrives in your inbox on Tuesdays and Fridays. This is a trilingual newsletter featuring stories in Spanish, Portuguese, and English.

Join 20,000 subscribers!