Harley-Davidson to Refund $228,000 to Massachusetts Motorcycle Owners

FILE: According to reports April 22, 2014, Harley-Davidson Inc. announced a 19 percent rise in first quarter. OAKLAND, CA - JULY 19: A sign is posted outside of Oakland Harley-Davidson on July 19, 2011 in Oakland, California. Motorcycle maker Harley-Davidson reported an unexpected rise in second quarter profits and their first U.S. sales increase sonce 2006 with earnings of $190.6 million, or 81 cents per share, compared to $71.2 million, or 30 cents per share, one year ago. (Photo by Justin Sullivan/Getty Images)
Harley-Davidson is paying back Mass. customers who didn’t receive refunds under their motorcycle finance agreements.
JUSTIN SULLIVAN/GETTY IMAGES

Harley-Davidson’s financial arm has agreed to pay $228,000 to more than 600 customers in Massachusetts and $25,000 to the Commonwealth.

According to a press release from the Massachusetts Attorney General’s office, Harley-Davidson Financial Services, Inc. (HDFS) failed to properly pay out refunds under the terms of its motorcycle finance agreements. Attorney General Martha Coakley said the settlement is just one example of how the state is monitoring finance companies and investigating when necessary:

We are pleased that this finance company stepped forward to reimburse Massachusetts customers and promptly adopted changes to its procedures. We are continuing to review the practices of other motor vehicle finance companies operating in the Commonwealth to ensure compliance with contractual obligations.

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After purchasing a motorcycle or other vehicle from Harley-Davidson, some customers take out a loan with HDFS. These HDFS borrowers can opt to pay optional enrollment fees in exchange for special loan terms. When borrowers paid their loans off early, they were often supposed to get refunds of the fees, but many did not. If the Harley-Davidson dealership where they made their vehicle purchase went out of business, for example, borrowers often had a hard time getting their refunds.

According to the press release, notices and payments will be mailed out in early July.