A $810 million lawsuit looms over NYC. The state's attorney general claims the city inflated taxi license prices by 240% for more than a decade and defrauded drivers.
New York's Attorney General, Letitia James, intends to sue the City of New York for $810 million claiming the city defrauded taxi drivers for more than a decade. James alleges the Taxi and Limousine Commission inflated the cost of taxi licenses nearly 240%, from more than $200,000 to close to $1 million. If the city does not pay relief in 30 days, James plans to file the lawsuit for restitution on behalf of the drivers. Visit Business Insider's homepage for more stories.
New York's Attorney General, Letitia James, plans to sue the City of New York for $810 million over allegations the city defrauded taxi drivers for 14 years by inflating prices of taxi licenses, Gothamist reported Thursday. A taxi medallion, or limited license, allows cabs to charge and pick up passengers. The New York City Taxi and Limousine Commission have sold medallions to drivers in auctions since 1937. James alleges the TLC inflated prices by hundreds of millions of dollars from 2004 to 2017 by overvaluing the medallions, setting minimums for bids and colluding on prices with brokers. James also claims the TLC misinformed drivers about the value of the medallions. A 2019 investigation by The New York Times reported evidence of fraud in a period where medallion prices skyrocketed 240% while drivers' income remained relatively stagnant. Drivers were reportedly cornered into predatory, six-figure loans to afford the medallions and Gothamist reported that several drivers killed themselves. "Government should be a source of justice, not a vehicle for fraudulent practices," James said in a press release. "These taxi medallions were marketed as a pathway to the American Dream, but instead became a trapdoor of despair for medallion owners harmed by the TLCs unlawful practices." James intends to sue the City of New York for $810 million in restitution and damages for the drivers if the city does not pay within 30 days. SEE ALSO: Farmers slam America's largest trucking brokerage with a $1.1 billion lawsuit https://www.businessinsider.com/truck-brokerage-hit-with-1-billion-lawsuit-from-farmers-2020-2 SEE ALSO: Wine is expected to get a lot more affordable due to an oversupply of California grapes https://www.businessinsider.com/wine-prices-expected-to-get-a-cheaper-grape-surplus-report-2020-2 Join the conversation about this story » NOW WATCH: Why Tesla's Model 3 received top crash-test safety ratings