Santander signs $ 550 million subprime loan settlement in 34 states

Law360 (May 19, 2020, 6:10 p.m. EDT) – A Santander Group consumer credit unit has reached a $ 550 million settlement with 34 states over allegations it made subprime auto loans to risk without proper oversight, creating a greater chance that consumers will default and repossess their vehicles, a coalition of state attorneys general said on Tuesday.

Led by Illinois Attorney General Kwame Raoul, the coalition has struck a deal that will require Santander Consumer USA Inc. to pay $ 65 million in restitution for some consumers and to write off up to $ 498 million in loans. The lender will also pay $ 5 million in civil penalties and $ 2 million for a settlement administrator to take care of …

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