Who put up Trump’s $175 million bond? A subprime car loan billionaire who has run afoul of regulators

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Don Hankey, chairman of Westlake Financial Services.

Ringo Chiu | ZUMA Wire | Alamy

Providing Donald Trump’s $175 million appeal bond when other insurers wouldn’t 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. 

Hankey’s assistance to Trump has brought the little-known billionaire into the spotlight. But in recent years, several of his companies’ 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’s companies four times, public records show. 

In 2017, for example, the Department of Justice filed a complaint in federal court in California against Westlake Financial, Hankey’s big subprime auto lender. With a network of 50,000 car dealerships and $3 billion in managed assets, Westlake Financial calls itself “The Yes! Yes! Lender.”

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. 

Five years later, the Justice Department returned with another complaint against 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.

“Service 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,” said Martin Estrada, U.S. Attorney for the Central District of California, at the time of the settlement. 

Hankey did not immediately respond to a request for comment.

The self-made Hankey is worth $7.4 billion, according to Forbes, and his companies control $18 billion in assets, employing more than 3,000 employees, the company’s website says. His seven 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 refinanced some Trump loans in 2022 when other banks balked.

The appeal bond provided to Trump by Hankey’s 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 while Trump appeals it. The judge overseeing the matter determined that the defendants had committed “persistent” fraud over several years.

Republican presidential candidate, former U.S. President Donald Trump attends a pre-trial hearing at Manhattan Criminal Court on February 15, 2024 in New York City. 

Brendan McDermid | Getty Images

Some Hankey customers are less than happy with his company’s 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, ranging from improperly repossessed vehicles, charges on a loan the customer did not sign up for, and failing to provide accurate loan balance and payment histories to credit reporting agencies. Such inaccuracies can cripple consumers’ ability to get other loans, lease residences or even secure jobs. 

Customers who fall behind on their auto loans also say Westlake employees call them repeatedly, the complaint records show. “Even when I have a payment arrangement, they will still call up to 6 times a day 7 days a week,” a borrower from Florida wrote last month. 

Hankey companies have also been subject to regulatory actions by the CFPB and by the California Department of Insurance. According to a 2015 consent decree filed by the CFPB against Westlake and its affiliate Wilshire, the CFPB found that Westlake and Wilshire pressured borrowers using illegal debt collection practices. Some 176,000 customers were affected, the consent order said. 

According to the CFPB, Westlake and Wilshire changed loan terms without telling borrowers, accruing additional interest on the loans. The companies also allegedly misled 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’ 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.

Westlake and Wilshire neither admitted nor denied the findings but paid $44 million to the customers and a $4.25 million penalty.

KnightBrook Insurance, another Hankey company, was cited by 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. 

Those alleged violations included failure to include fees in the total loss settlements customers received, failure to “conduct and diligently pursue a thorough, fair and objective investigation of a claim;” failure to pay salvage certificate fees; and failure to pay reasonable towing charges.

According to the report, KnightBrook agreed with the state’s findings and said it “intends to implement corrective actions in jurisdictions where applicable.”



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