Court punishes finance company and owner

Mahmood “Mike” Nasiry, a veteran of the lending business, decided women couldn’t be counted on to repay loans. So when he started a company to purchase overdue loans at a discount from used-car car dealers, he paid lower prices if the borrower was a woman — in more than 1,000 instances over a period of 21 months.

That decision is turning out to be costly. An appeals court has just upheld $6.2 million in discrimination penalties against Nasiry and his company, M&N Financing Corp., and a California civil rights agency wants further damages for employees who were forced to take part in the practice.

The practice was “an invasion of the female borrowers’ legally protected interest to be free from arbitrary sex discrimination,” the state’s Second District Court of Appeal said Monday. The court said the lending bias also violated car dealers’ rights by lowering their returns on loans to women.

Nasiry had been in the loan business for 10 years when he founded his Los Angeles company in 2012. In its 2014 lawsuit, the state Department of Fair Employment and Housing said Nasiry told his employees “that women were unable to make payments on a car; they needed a man to help them. He compared entering a loan contract with a woman to dating a woman with a sexually transmitted disease: The contract would sting you in the end.”