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Home » Inside Tricolor’s $2.2B ABS fallout: fraud, red flags and lessons for auto lenders

Inside Tricolor’s $2.2B ABS fallout: fraud, red flags and lessons for auto lenders

Bankruptcy forcing lenders to reexamine data controls, securitization practices

Aidan BushbyAidan Bush
February 2, 2026
in Features, Risk Management
Reading Time: 10 mins read
0
A Tricolor dealership in Houston, Texas, US, on Thursday, Sept. 11, 2025. Tricolor Holdings, a used car seller and subprime lender that focuses on undocumented immigrants in the US Southwest, filed to liquidate in bankruptcy. US prosecutors are also looking into allegations of fraud by the company.

(Courtesy/Bloomberg)

The collapse of subprime auto lender Tricolor Holdings has asset-backed securitization and subprime auto players divided on whether it’s a sign of more failures to come. Tricolor, which allegedly offered investors $800 million in fictitious collateral, operated 65 buy here, pay here dealerships spanning seven states and financed all auto sales in-house. The Irving, Texas-based […]

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Tags: Auto Dealer Activityfirst brandsPremiumsubprimeTricolor
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