A look at Berkshire Hathaway's response to 'mobile home trap' investigation

Daniel Wagner
Updated

After The Seattle Times and The Center for Public Integrity published their investigation of Berkshire Hathaway’s mobile-home business, Berkshire sent a statement to a newspaper it owns, calling the story “misleading.” It did not point to any factual inaccuracies.

For months, Berkshire Hathaway and Clayton Homes, its mobile-home subsidiary, had ignored or declined reporters’ requests to discuss the company’s treatment of consumers.

Here’s a look at the company’s statement, published by the Omaha World-Herald, and the credibility of its claims:

CLAIM: “Clayton Homes’ policies, procedures and training are designed to ensure that customers have a choice of lenders. A list of all available lenders is posted and provided in company-owned retail locations.”

FACTS: Customers historically have not been given a choice of lenders, according to customers interviewed for this report. In early 2015, a reporter visited Clayton-owned and -affiliated dealerships in eastern Tennessee, and saw large, house-sized banners promoting Clayton loan products. There were no comparable signs related to other lenders. Promotional materials related to other lenders at one dealership consisted of small, trifold brochures located on a side table in one room of the dealership.

CLAIM: “Customers are encouraged to select more than one lender so they can compare options – and select the loan program that best serves their needs.”

FACTS: Numerous customers interviewed for this story said they were told that Clayton lenders were the only option or the best option. Some did not realize, nor were they told, they said, that the home dealers and lenders were part of the same company. They said they were never encouraged to explore alternatives.

CLAIM: “The retailer selling the home receives no financial incentives from the lender the customer chooses.”

There’s more to this story. Click here to read the rest at the Center for Public Integrity.

This story is part of Finance. The latest investigations about U.S. financial reform, corporate accountability and consumer finance. Click here to read more stories in this investigation.

Related stories

Copyright 2014 The Center for Public Integrity. This story was published by The Center for Public Integrity, a nonprofit, nonpartisan investigative news organization in Washington, D.C.