Bipartisan Coalition of State AGs Step in After Credit Acceptance Corporation Received a Corporate Pardon From Trump Administration

September 17, 2026 | WASHINGTON, D.C. — Today, a bipartisan coalition of 41 state attorneys general announced an action against predatory subprime auto lender Credit Acceptance Corporation (CAC) to resolve allegations that the company targeted low-income and working-class car buyers with predatory, high-cost loans that the firm knew could never be repaid. This action will return nearly $700 million in restitution and debt relief to car buyers harmed by CAC’s abuses.

In 2023, the federal Consumer Financial Protection Bureau (CFPB) and the New York Attorney General sued CAC for these abuses. In 2025, CFPB issued CAC a corporate pardon, permanently dismissing its lawsuit against the lender and preventing the federal government from ever holding the firm accountable in the future for its illegal practices. New York continued to prosecute its case and today announced it had resolved this action along with dozens of other state AGs across the country. 

“A car isn’t a luxury — it’s how people get to work, to school, to the doctor,” said Protect Borrowers’ Senior Fellow Tara Mikkilineni, who, until 2025, served as a senior enforcement official at the CFPB.  “When a lender builds its business model around putting borrowers into loans they can’t afford, the harm isn’t just financial, it’s the loss of the mobility that makes everything else possible. This settlement holds CAC accountable and sends a clear signal to the rest of the market.”

“Dozens of attorneys general found that Credit Acceptance took advantage of people living paycheck to paycheck–desperate for a car–driving them deeper and deeper into debt they couldn’t afford. The Trump administration is letting lawbreaking companies off the hook even as attorneys general from both parties are holding them accountable,” added Mike Pierce, executive director at Protect Borrowers. “The Trump-led CFPB should have to answer for its decisions to let corporate wrongdoing go unchecked.”

Americans owe an historic level of auto loan debt. Research released earlier this year by Protect Borrowers and The Century Foundation, co-authored by Mikkilineni, found that auto loan debt has exploded to a record $1.68 trillion, a 37 percent surge since 2018, pushing 86 million Americans deeper into financial pain. Findings from this research show widening economic and racial disparities in the auto loan market:

  • Low-income borrowers carry $4,000 more auto debt than high-income borrowers, with an average balance of $28,832
  • Rural communities and states where driving is most necessary—like Texas, Alaska, and Florida—struggle with the highest auto debt levels
  • Black, Hispanic, and American Indian borrowers are given higher interest rates on auto loans across all credit tiers

Background

Protect Borrowers and CFA memo on additional enforcement actions dropped by the CFPB: In Eight Months, Trump’s CFPB Has Let More Than 40 Lawbreakers Off the Hook

Protect Borrowers and The Century Foundation: When the Wheels Come Off: How Surging Auto Loan Debt Is Hurting Households 

Consumer Federation of America: Driven to Default: The Economy-Wide

Risks of Rising Auto Loan Delinquencies

Further Reading

Amicus Brief from a coalition of veterans and nonprofit groups challenging efforts by the Trump Administration to shutter the CFPB: Amicus Brief to the U.S. Court of Appeals for the District of Columbia Circuit in NTEU v. Vought

Protect Borrowers blog post on the Trump CFPB’s Settlement with MoneyLion: Trump’s CFPB Waves the White Flag on the Military Lending Act to Give MoneyLion a Sweetheart Deal. Why?

Protect Borrowers blog post on the Trump CFPB costing Americans: Trump’s Consumer Financial Protection Agenda—or Lack Thereof—Has Already Cost Americans More Than $18 Billion

Protect Borrowers and Consumer Federation of America (CFA) blog post on the fight to defend CFPB: Trump Trashes the Economy and Leaves Americans Vulnerable: Two Disastrous Months of Trump’s CFPB

Protect Borrowers and CFA memo on repeat offenders and CFPB enforcement: As House Financial Services Committee Majority Lines Up Industry Witnesses to Bash CFPB, Consumer Advocates Issue Rap Sheet Highlighting More Than $3 Billion in Harm Caused by Corporate Repeat Offenders

Protect Borrowers warns state AGs of emerging tech scam: As CFPB Enforcement Folds, Predatory Tech Company Prehired Defies Government Order to Cease Operations and Continues Defrauding Students

Protect Borrowers and CFA memo identifying 87 congressionally imposed mandates Director Vought is refusing to perform: Advocates Applaud Lawsuits Challenging Trump and Vought’s Corrupt and Unlawful Attempt to “Delete” Consumer Watchdog Agency, CFPB

Protect Borrowers press release on federal court temporary blocking Trump, Musk, and Vought from dismantling the CFPB: In a Major Victory for Americans, Federal Court Blocks Trump, Musk, Vought Effort to Dismantle the Consumer Financial Protection Bureau

Protect Borrowers blog on Musk and DOGE illegal attempt to “delete” CFPB: Elon and DOGE Are Attempting To Illegally “Delete” the CFPB, Here Is Why This Matters To Student Loan Borrowers

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About Protect Borrowers

Protect Borrowers (formerly Student Borrower Protection Center) is a nonprofit organization led by a team of experts, lawyers, and advocates fighting to build an economy where debt doesn’t limit opportunity. We investigate financial abuses, take predatory companies to court, and push for policies to protect working people from debt traps. We aim to deliver immediate relief to families while building power, driving systemic change, and fighting for racial and economic justice.

Learn more at protectborrowers.org or follow us on social @BorrowerJustice.