For many New York City cabbies, the dream is to buy a medallion—a city permit that lets them own a yellow cab. But a cottage industry of sketchy loans and artificially high medallion prices ruined that dream for a generation of drivers, the New York Times reports. "I don’t think I could concoct a more predatory scheme if I tried," says a Harvard Law School instructor. "This was modern-day indentured servitude." The drivers, mostly immigrants, bought the medallions by taking out unaffordable loans that often included high fees and a ceding of their legal rights. When medallion prices rose to over $1 million, drivers refinanced for even more money. And when the medallion bubble burst in 2014, drivers saw their nest eggs vanish, Bloomberg noted last year. Yet the crushing debt remained.
Behind it all were banks seeking to lend money. They called up taxi-industry players like fleet owners and brokers, who lent drivers the banks' money and took their cut. Meanwhile, those who sold medallions made a killing—one "taxi king" listed his NYC penthouse for $27 million in 2014, Forbes reported at the time—as city officials looked the other way. "It was a party," says the former chair of the Taxi and Limousine Commission. "Why stop it?" Lenders deny wrongdoing and say they only wanted to help eager drivers, while others say ride-hailing companies like Lyft and Uber caused the crisis. But over 950 medallion owners in New York have gone bankrupt, thousands are barely solvent, and at least eight have committed suicide. "It's an inhuman life," says one indebted driver. "I drive and drive and drive. But I don't know what my destination is." (Read more taxi cabs stories.)