Trustee asks court to slap defunct Centrix Financial with $15M fine | Auto Finance News Trustee asks court to slap defunct Centrix Financial with $15M fine | Auto Finance News
Auto Finance News
Subscribe
  • Home
  • News
    • All News
    • Exec of the Year
    • Innovation & Technology
    • Management
    • Compliance & Regs
    • Risk Management
    • Capital & Funding
    • Powersports
  • Events
    • DEMOvation Challenge
    • Auto Finance Summit
    • Auto Finance Innovation Summit
  • EXCELLENCE
    • Best Practices
    • Topics
      • Compliance
      • Customer Experience
      • Technology
    • White Papers
    • Glossary
  • Magazine
    • Latest
    • Magazine Issues
  • Data
    • Lender Ranking
    • Fixed Rate Outstandings at Banks
    • Securitizations
    • Market Share Monitor
AFN PLUS
Saturday, January 23, 2021
Log In
No Result
View All Result
Auto Finance News
  • Home
  • News
    • All News
    • Exec of the Year
    • Innovation & Technology
    • Management
    • Compliance & Regs
    • Risk Management
    • Capital & Funding
    • Powersports
  • Events
    • DEMOvation Challenge
    • Auto Finance Summit
    • Auto Finance Innovation Summit
  • EXCELLENCE
    • Best Practices
    • Topics
      • Compliance
      • Customer Experience
      • Technology
    • White Papers
    • Glossary
  • Magazine
    • Latest
    • Magazine Issues
  • Data
    • Lender Ranking
    • Fixed Rate Outstandings at Banks
    • Securitizations
    • Market Share Monitor
AFN PLUS
Log In
No Result
View All Result
Auto Finance News
No Result
View All Result

Trustee asks court to slap defunct Centrix Financial with $15M fine

Nicole Casperson by Nicole Casperson
October 28, 2019
in Risk Management
Reading Time: 2min read

The liquidating trustee for bankrupt Centrix Financial has asked the U.S. District Court of Colorado to slap the defunct lender with a $15 million fine for allegedly lying about its finances to secure a 2014 settlement.

Jeffrey Weinman, the trustee on behalf of Centrix Financial Liquidating Trust, filed a motion on Oct. 21 claiming that Centrix Chief Executive Robert Sutton and his family lied about their finances in order to obtain a deal that had Sutton shell out $350,000 to creditors to resolve more than $100 million losses.

Weinman spent years researching Centrix’s finances and discovered that Sutton hid “approximately $20 million worth of assets in shell entities” during litigation for the 2014 settlement, according to the court filing. “The fruits of the discovery confirm that the Suttons’ financial disclosures were spectacularly fraudulent,” the filing noted.

Before shuttering its operations, Centrix originated loans for various car dealerships using money from several credit unions, the filing noted. Centrix “fleeced” the credit unions of more than $100 million by promising a return of 6% to 8% and claiming that all loans were insured and underwent a due diligence process, according to court documents. Instead, the loans had an “astonishing default rate of over 40%,” Weinman found. 

Upon discovering the scheme, creditors placed Centrix in involuntary bankruptcy. 

A full financial investigation in the bankruptcy revealed that Centrix was asset-less, having been “bled dry” by Sutton, according to the motion. As a result, the bankruptcy court authorized the creation of a liquidating trust, the main assets of which were litigation claims against Sutton and his family members and entities to whom he had fraudulently transferred Centrix’s assets. “Monetizing those litigation claims would be effectively the only source of recovery for creditors,” the filing noted. 

Tags: auto finance fraudauto fraudcentrixcentrix financialfraud
Previous Post

Member-focused strategy drives PenFed’s product innovation

Next Post

AFS 2019: Digital lending fintech enters auto

Related Posts

Used-vehicle prices increase, inventory outpaces norm
Risk Management

Used-vehicle prices increase, inventory outpaces norm

January 22, 2021
US jobless claims fall slightly, though remain near 1M
Risk Management

US jobless claims fall slightly, though remain near 1M

January 21, 2021
TrueCar forecasts 16M SAAR in 2021 
Risk Management

TrueCar forecasts 16M SAAR in 2021 

January 21, 2021
Next Post

AFS 2019: Digital lending fintech enters auto

Latest Magazine Issue

INNOVATION & TECHNOLOGY

Upstart partners with Oriental Bank, enlarges lending footprint

Upstart partners with Oriental Bank, enlarges lending footprint

January 20, 2021
GM jumps as Microsoft joins $2B self-driving venture

GM jumps as Microsoft joins $2B self-driving venture

January 19, 2021

Sign Up Email List

CORONAVIRUS

Used-vehicle prices increase, inventory outpaces norm

Used-vehicle prices increase, inventory outpaces norm

January 22, 2021
Dueling dynamics will shape consumer credit in 2021

Dueling dynamics will shape consumer credit in 2021

January 20, 2021

SPONSORED

Collateral Protection Insurance (CPI): What is CPI and what does it do?

Collateral Protection Insurance (CPI): What is CPI and what does it do?

January 8, 2021
US auto sales poised for crash after slowest pace in a decade

Driving Customer Loyalty, Retention After Total Loss

December 9, 2020
When tough times hit, proactive strategies pay

When tough times hit, proactive strategies pay

November 2, 2020

About

ABOUT US

PRIVACY TERMS

ADA COMPLIANCE

CODE OF JOURNALISM ETHICS

Contact Us

ADVERTISE

HELP CENTER

EMAIL SIGN UP 

Follow Us

twitter twitter linkedin podcast

©2021 Royal Media & Auto Finance News

No Result
View All Result
  • Home
  • News
    • All News
    • Exec of the Year
    • Innovation & Technology
    • Management
    • Compliance & Regs
    • Risk Management
    • Capital & Funding
    • Powersports
  • Events
    • DEMOvation Challenge
    • Auto Finance Summit
    • Auto Finance Innovation Summit
  • Excellence
    • Best Practices
    • Topics
      • Compliance
      • Customer Experience
      • Technology
    • White Papers
    • Glossary
  • Magazine
    • Latest
    • Magazine Issues
  • Data
    • Lender Ranking
    • Fixed Rate Outstandings
    • Securitizations
    • Market Share Monitor
  • +PLUS
  • SUBSCRIBE
  • Log In / Account

© 2020 Royal Media

Go to mobile version