Episode 2: The Myth of the Medallion
Producer/Director Suzanne Hillinger
How does a New York City taxi driver who makes about $22,000 a year get a loan for almost $1 million? Our reporters investigating the taxi industry for “The Weekly” found that a group of under-regulated industry leaders created a financial bubble in the market for medallions, the permits that let drivers own their own cab. Bankers, brokers, fleet owners and even city officials artificially inflated the prices of medallions and reaped huge profits by steering immigrant drivers into reckless loans.
If some of the details sound to you like the subprime mortgage crisis that helped tank the U.S. economy, you’re right. This time, the practice ensnared drivers looking to fulfill their American dream by buying an iconic New York City yellow cab. Many of them have been left hopeless and financially ruined.
“I know so many drivers, they killed themselves,” says Mohammad Hossain, a taxi driver who borrowed money to buy his own medallion at the height of the bubble. Mohammad and dozens of other drivers share their anger and despair with Brian M. Rosenthal, an investigative reporter for The New York Times, and Emma G. Fitzsimmons, a transit reporter. The bankers and officials who engineered the system and profited from the loans say they did nothing wrong and have few regrets.
After The Times first published its investigation in May 2019, various government officials vowed to take action.
The city is investigating the brokers.
The state has begun an inquiry into the lenders.
The federal government is reviewing some of the regulators.
Meanwhile, Mohammad still owes the bank $700,000.
Mohammad emptied his savings to buy a taxi medallion. He had no idea that he had just signed away his financial freedom. Watch this clip of “The Weekly.”
Director of Photography Adam Beckman
Video Editor Pierre Takal
Story Editors Dan Barry, Liz O. Baylen, Liz Day, Alexandra Garcia
Associate Producer Madeline Rosenberg