August 8, 2014 / 12:01 AM / 4 years ago

Santander Consumer gets subpoena over subprime auto loans

Aug 7 (Reuters) - Santander Consumer USA Holdings Inc said it has recently received a civil subpoena from the U.S. Department of Justice related to its nonprime auto loans.

The subpoena, received under FIRREA, requests for “production of documents and communications that, among other things relate to the underwriting and securitization of nonprime auto loans since 2007,” the company disclosed in a quarterly filing with the regulators.

Santander Consumer said that it was cooperating with the request.

FIRREA, the Financial Institutions Reform, Recovery and Enforcement Act, allows the Justice Department to sue over fraud affecting a federally insured financial institution.

Earlier this week, General Motors Co’s auto financing arm, General Motors Financial Co Inc, also received a subpoena over subprime auto loans it made and securitized since 2007.

Financial services firms have paid billions of dollars to resolve investigations under FIRREA into questionable mortgages pooled into securities in the run-up to the financial crisis. (Reporting by Avik Das in Bangalore; Editing by Ken Wills)

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