WASHINGTON — A multistate settlement between a coalition of 34 state's Attorneys General and the nation's largest subprime auto financing company last year means hundreds of District residents could see financial relief this month.
D.C. Attorney General Karl Racine said in tweet Monday that over 900 District residents began receiving relief payments from Santander Consumer USA.
The settlement was reached with Santander in May of 2020 and included $550 million in relief for consumers in states including D.C., Maryland and Virginia.
The Santander settlement stems from a multistate investigation of Santander’s subprime lending practices. In March 2015, the Illinois Attorney General’s office led the coalition in opening the investigation into the largest subprime auto financing company in the country after receiving an increase in consumer complaints related to subprime auto loans.
Based on the multistate investigation, the coalition alleges that Santander, through its use of sophisticated credit scoring models to forecast default risk, knew that certain segments of its population were predicted to have a high likelihood of default. Santander exposed these borrowers to unnecessarily high levels of risk through high loan-to-value ratios, significant backend fees, and high payment-to-income ratios.
The states joining in the settlement led by Illinois Attorney General Raoul are the attorneys general of California, Maryland, New Jersey, Oregon and Washington, who comprise the executive committee; as well as the attorneys general of Arizona, Arkansas, Connecticut, the District of Columbia, Florida, Georgia, Hawaii, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Michigan, Minnesota, Nebraska, New Hampshire, New Mexico, New York, North Carolina, Pennsylvania, Rhode Island, South Carolina, Tennessee, Utah, Virginia, West Virginia, and Wyoming.
Payments to those people impacted began being distributed electronically on June 4, 2021, while checks were distributed beginning on June 8, 2021.
Anyone seeking addition information about the settlement should visit the settlement's website here.
