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CACC.US
id: 338, Created by Stan Vick Chase, Scout
Credit Acceptance Corporation
Settled
04 May 2018
Class period Start28 August 2020
Class period End02 December 2022
Claim deadlinePalm Tran, Inc. Amalgamated Transit Union Loc. 1577 Pension Plan v. Credit Acceptance Corp.
Credit Acceptance Corp. (CCAC) agreed to pay $12 million to settle a securities class action lawsuit accusing the Company of deceiving investors about the Company’s business, operations, and adherence to the appropriate laws and regulations.
The Complaint alleged that the Company and its Leaders failed to disclose to investors:
- that the Company was topping off the pools of loans that they packaged and securitized with higher-risk loans;
- that Credit Acceptance was making high-interest subprime auto loans to borrowers that the Company knew borrowers would be unable to repay;
- that the borrowers were subject to hidden finance charges, resulting in loans exceeding the usury rate ceiling mandated by state law;
- that Credit Acceptance took excessive and illegal measures to collect the debt from defaulted borrowers;
As a result, the Company was likely to face regulatory scrutiny and possible penalties from various regulators or lawsuits.
Credit Acceptance Corp. (CCAC) agreed to settle with investors to avoid further litigation.
Alleged Offence
Other
Suspected Party
Other
Security Type
Stocks
Trade Direction
Long
Lead plaintiff
Ontario Provincial Council of Carpenters’ Pension Trust Fund, Millwright Regional Council of Ontario Pension Trust Fund.
Attorney
Labaton Sucharow, Clark Hill PLC
Court
Eastern District of Michigan
Judge
Hon. Linda V. Parker
Administrator
JND Legal Administration
Court hearing date
07 December 2022
+$12,000,000
Total Settlement Amount