Kentucky and West Virginia will receive shares of a half-billion-dollar settlement with an automotive loan company that allegedly gave customers predatory auto loans.
According to statements from Kentucky Attorney General Daniel Cameron and West Virginia Attorney General Patrick Morrissey, Kentucky and West Virginia are two of 33 states which will receive portions of a $550 million settlement with Santander Consumer USA, which was accused of violating consumer protection laws with predatory auto loans. According to the two attorneys general, the company was accused of targeting consumers who were likely to default on loans they received for automobiles.
According to Cameron’s office, Kentucky will receive $12 million, which includes $1.1 million in restitution for Kentucky consumers and waivers of $5.6 million in deficiencies on 532 outstanding loans to Kentuckians. Santander will also be required to “try to buy back 769 Kentucky deficiency waivers, amounting to an additional $5.3 million.”
Santander will also provide “in-kind” relief for Kentucky consumers who have or may default on loans after Dec. 31, 2019, by releasing their titles and waiving any outstanding loan balance, Cameron’s office reports.
According to Morrissey’s office, West Virginia will receive $6.4 million, including $5.9 million in cancelled debt for consumers, $527,479 in consumer restitution and $30,000 in restitution to the state.
According to Morrissey’s office, restitution is available to certain subprime consumers who defaulted on loans between Jan. 1, 2010, and Dec. 31, 2019. For consumers with the lowest quality loans who defaulted as of Dec. 31, 2019, and have not had their cars repossessed, Morrissey’s office says, Santander must allow them to keep their vehicles and waive any loan balance up to a total value of $45 million in loan forgiveness.