NEW YORK, May 21, 2020 (GLOBE NEWSWIRE) — Lowey Dannenberg P.C., a preeminent law firm in obtaining redress for consumers and investors is investigating possible violations of federal securities laws on behalf of investors of Santander Consumer USA Holdings Inc. (“Santander” or the “Company”) (NYSE: SC).
Santander is a provider of financing, refinancing, and cash back refinance services for new and used vehicles. On May 19, 2020, Santander announced that it has reached a settlement with a group of 34 state attorneys general worth $550 million over shady subprime auto loan lending practices. The states accused Santander of violating consumer protection laws by providing auto loans to borrowers with subprime credit and a high chance of defaulting. Santander made loans to borrowers who could not afford them, charged excessive fees, and failed to monitor dealers that falsified borrowers’ incomes and other information when submitting loan applications.
Importantly, these auto loans — which were created by a flawed process and without the requisite level of due diligence — are ultimately bundled together and sold in securitized form as a series of bonds, called subprime auto loan bonds. The widespread misrepresentations that accompanied the origination of the auto loans, rendered the subprime auto loan bonds riskier and more volatile than a reasonable investor would have expected.
The decline in economy caused by the coronavirus pandemic has already began to expose the flawed origination process. The most recent data shows an unprecedented spike in the rate of delinquencies experienced on subprime auto loans, reaching nearly 5%, which is about the same delinquency rate as during the worst days of the global financial crises of 2008. As a result, subprime auto loan bonds suffered significant loss of value and marketability.
If you are a shareholder who holds subprime auto loan bonds issued by Santander, we encourage you to contact our attorneys at Lowey Dannenberg at (914) 733-7256 or investigations@lowey.com to learn more about this investigation or to discuss your options.
Whistleblowers: Persons with non-public information regarding Santander should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC.
About Lowey Dannenberg
Lowey Dannenberg is a national firm representing institutional and individual investors, who suffered financial losses resulting from corporate fraud and malfeasance in violation of federal securities and antitrust laws. The firm has significant experience in prosecuting multi-million-dollar lawsuits and has in the past recovered billions of dollars on behalf of investors.
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Lowey Dannenberg P.C.
44 South Broadway, Suite 1100
White Plains, NY 10601
Tel: (914) 733-7256
Email: investigations@lowey.com