Consumer Finance Insights
February 25, 2015

National Auto Lender Receives Subpoena Related to Subprime Auto Financing and Securitization

On February 25, 2015, a national lender and securitizer of automobile loans disclosed in a SEC Filing that the Department of Justice (“DOJ”) issued a subpoena to the lender in January 2015 regarding its origination and securitization of subprime auto loans. The lender disclosed that the DOJ may initiate civil proceedings against the lender for potential violations of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989. The subpoena requested information on underwriting practices and the representation of the underwriting practices made when those auto loans were securitized. The lender disclosed that it was one of several other securitizers of sub-prime automobile receivables who received a subpoena from the DOJ in 2015.