Providing Donald Trump\u2019s $175 million appeal bond when other insurers wouldn\u2019t is business as usual for California financier Don Hankey. As chairman of the Los Angeles-based Hankey Group of Companies, which includes an insurer, a subprime auto lender and a commercial real estate investment firm, Hankey has amassed a fortune lending to borrowers other financial firms shun.\u00a0<\/p>\n
Hankey\u2019s assistance to Trump has brought the little-known billionaire into the spotlight. But in recent years, several of his companies\u2019 operations attracted the attention of the U.S. Justice Department, the Consumer Financial Protection Bureau and the California Department of Insurance. Since 2015, regulators have taken action against Hankey\u2019s companies four times, public records show.\u00a0<\/p>\n
In 2017, for example, the Department of Justice\u00a0filed a complaint in federal court in California against Westlake Financial, Hankey\u2019s big subprime auto lender. With a network of 50,000 car dealerships and $3 billion in managed assets, Westlake Financial calls itself \u201cThe Yes! Yes! Lender.\u201d<\/p>\n
Westlake and its subsidiary Wilshire Commercial Capital, the DOJ complaint alleged, illegally repossessed at least 70 vehicles owned by military service members protected under the Servicemembers Civil Relief Act. The companies paid $761,000 to settle the allegations.\u00a0Five years later, the Justice Department returned with another\u00a0complaint\u00a0against Westlake, alleging that it had failed to provide service members with interest rate benefits they were owed under the law. The company paid $225,000 to settle that matter.<\/p>\n
\u201cService members make enormous sacrifices, and we have a responsibility to protect their rights and ensure they have full access to important benefits guaranteed under the law,\u201d said Martin Estrada, U.S. Attorney for the Central District of California, at the time of the settlement.\u00a0<\/p>\n
Hankey did not immediately respond to a request for comment.<\/p>\n
The self-made Hankey is worth $7.4 billion,\u00a0according to\u00a0Forbes, and his companies control $23 billion in assets, employing more than 3,000 employees, the company\u2019s website says. His eight financial entities include Westlake, Knight Insurance Group, whose unit provided the appeal bond to Trump, a commercial real estate investment firm and a provider of fleet financing for rental car companies. He is also a large stockholder in Axos Financial, the San Diego company whose bank\u00a0refinanced some Trump loans in 2022 when other banks balked.The appeal bond provided to Trump by Hankey\u2019s Knight Specialty Insurance prevents the New York Attorney General from collecting on the $464 million judgment she won against Trump and his co-defendants in a civil fraud case\u00a0while\u00a0Trump appeals it.\u00a0The judge overseeing the matter determined that the defendants had committed \u201cpersistent\u201d fraud over several years.<\/p>\n
Some Hankey customers are less than happy with his company\u2019s practices, according to consumer complaints filed against Westlake with the federal Consumer Financial Protection Bureau. Over the past year, records compiled by the agency show an almost daily stream of customer allegations against Westlake,\u00a0ranging from improperly repossessed vehicles, charges on a loan the customer did not sign up for, and failing to\u00a0provide accurate loan balance and payment histories to credit reporting agencies. Such inaccuracies can cripple consumers\u2019 ability to get other loans, lease residences or even secure jobs.\u00a0<\/p>\n
Customers who fall behind on their auto loans also say Westlake employees call them repeatedly, the complaint records show. \u201cEven when I have a payment arrangement, they will still call up to 6 times a day 7 days a week,\u201d a borrower from Florida wrote last month.\u00a0<\/p>\n
Hankey companies have also been subject to regulatory actions by the CFPB and by the California Department of Insurance.\u00a0According to a\u00a02015 consent decree filed by the CFPB against Westlake and its affiliate Wilshire,\u00a0the CFPB\u00a0found that Westlake and Wilshire pressured borrowers using illegal debt collection practices.\u00a0Some 176,000 customers were\u00a0affected, the consent order said.\u00a0<\/p>\n
According to the CFPB, Westlake and Wilshire changed loan terms without telling borrowers, accruing additional interest on the loans.\u00a0The companies also\u00a0allegedly\u00a0misled customers by manipulating caller IDs and posing as employees calling from flower shops or pizzerias to trick borrowers into disclosing their locations or their vehicles\u2019 for repossession purposes. In other cases, Westlake collection agents led borrowers to believe that their vehicles would be released if they paid a certain sum, usually less than the full amount owed. Once those payments were made, Westlake did not release the vehicles, the CFPB found.<\/p>\n
Westlake and Wilshire neither admitted nor denied the findings but paid $44 million to the customers and a $4.25 million penalty.<\/p>\n
KnightBrook Insurance, another Hankey company, was\u00a0cited\u00a0by the California Department of Insurance in 2015 for an array of violations in the way it handled customer claims. Over a one-year period, the department reviewed 127 automobile and collateral protection claims handled by KnightBrook and found 45 violations of the state insurance code.\u00a0<\/p>\n
Those alleged violations included failure to include fees in the total loss settlements customers received, failure to \u201cconduct and diligently pursue a thorough, fair and objective investigation of a claim;\u201d failure to pay salvage certificate fees; and failure to pay reasonable towing charges.<\/p>\n
According to the report, KnightBrook agreed with the state\u2019s findings and said it \u201cintends to implement corrective actions in jurisdictions where applicable.\u201d<\/p>\n<\/p>\n
Providing Donald Trump\u2019s $175 million appeal bond when other insurers wouldn\u2019t is business as usual for California financier Don Hankey. As chairman of the Los Angeles-based Hankey Group of Companies, which includes an insurer, a subprime auto lender and a commercial real estate investment firm, Hankey has amassed a fortune lending to borrowers other financial […]<\/p>\n","protected":false},"author":0,"featured_media":2747,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-2746","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"_links":{"self":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/2746","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/comments?post=2746"}],"version-history":[{"count":0,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/2746\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media\/2747"}],"wp:attachment":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media?parent=2746"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/categories?post=2746"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/tags?post=2746"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}