The New York Attorney General’s office and New York Mayor Bill de Blasio have both ordered investigations into the practices of the taxi industry that has resulted in drivers saddled with crushing debt after being steered into costly loans.
According to a report in The New York Times, the Mayor of New York is investigating the brokers who helped arrange loans that skyrocketed in price over a period of years so taxi drivers could purchase medallions. While officials have long blamed Uber and Lyft, the ride-hailing startups, for New York City taxi drivers’ woes, a New York Times report over the weekend revealed that it was the inflated prices of the medallions and expensive loans used to purchase the medallions that are crippling drivers.
The moves on the part of the NY AG’s office and Mayor de Blasio are the first steps in addressing the problems that have hurt the yellow cab industry in New York City. According to the New York Times report, a handful of leaders in the taxi industry artificially boosted the price of the medallion — which is necessary in the city to own and operate a taxi — and then made hundreds of millions of dollars by giving low-income buyers loans they couldn’t pay back. The paper likened it to the real estate bubble that led to the financial crisis in 2008 and 2009. The paper noted the government was part of the problem by selling medallions and saying in ads purchasing one is better than investing in stocks.
“Our office is beginning an in
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