Hertz is expected to pay a total of $168 million as part of settlement agreements related to allegations that the car rental company wrongly reported customers for vehicle theft, according to a press release on Monday.
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The settlements, which the company says will be paid by the end of the year, will resolve more than 360 legal claims from customers alleging they were arrested for reports of allegedly stolen vehicles. mistakenly filed by the company with the authorities. They score more than 95% of pending claims related to the false arrest issue reaching resolutions, according to the Hertz statement.
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Hertz said the settlements, which the company expects to “recover a significant portion” of its insurance companies, are unlikely to have “a significant impact on its capital allocation plans for the remainder of 2022. and 2023”.
“As I have said since joining Hertz earlier this year, my intention is to lead a company that puts the customer first,” CEO Stephen Scherr said in a statement. “In resolving these claims, we are sticking to that goal.”
Scherr previously described “rectifying the situation” as a “priority” in an interview with Bloomberg in early April.
Hertz CEO plans to tackle false arrest issue, expects settlement with victims
“We now have policies in place that will mitigate, if not eliminate, the risk of this happening again,” he said at the time. “For a client who has not been treated well, we will do the right thing.”
According to the Philadelphia Inquirer, reports of customers being wrongly accused of stealing rental vehicles first surfaced a few years ago.
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Peter Aitken contributed to this report.