{"id":64016,"date":"2025-11-25T06:53:18","date_gmt":"2025-11-25T06:53:18","guid":{"rendered":"https:\/\/www.newsbeep.com\/us-tx\/64016\/"},"modified":"2025-11-25T06:53:18","modified_gmt":"2025-11-25T06:53:18","slug":"tricolor-fails-and-critics-probe-what-its-collapse-means-for-subprime-auto-loans","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us-tx\/64016\/","title":{"rendered":"Tricolor fails, and critics probe what its collapse means for subprime auto loans"},"content":{"rendered":"

Cynthia Jackson came to me a year ago with a complaint<\/a> about how she was treated by Tricolor<\/a>, a huge used car business based in Dallas. Warning signs were everywhere.<\/p>\n

We had no way of knowing that Tricolor was about to crash into bankruptcy<\/a>, come under investigation for fraud and abandon an estimated 11,000 cars on its nearly 60 car lots in several states.<\/p>\n

We had no way of knowing that Tricolor (pronounced tree-calore) was about to become a symbol of the weakness of the subprime auto industry.<\/p>\n

\"Cynthia<\/p>\n

Cynthia Jackson says a used car she bought from Tricolor Auto caused no end of problems. for herself. Now Tricolor has filed bankruptcy and closed.<\/p>\n

Courtesy of Cynthia Jackson<\/p>\n

Watchdog Alert<\/p>\n

Are you a taxpayer in Texas? The Watchdog has your back.<\/p>\n

By signing up, you agree to our\u00a0Terms of Service<\/a>\u00a0and\u00a0Privacy Policy.<\/a><\/p>\n

Buy-here, pay-here<\/p>\n

The company was launched with high hopes. The three colors are from the Mexican flag. Target customers were Hispanic adults, many without a driver\u2019s license, credit score or even Social Security number.<\/p>\n

The \u201cbuy-here, pay-here\u201d lot charged high interest rates, didn\u2019t stand behind its vehicles\u2019 conditions and demanded biweekly payments. Clients who missed enough payments saw the car taken back and resold to someone else.<\/p>\n

No help on repairs<\/p>\n

Jackson\u2019s problems began when the water pump on her Ford Explorer broke. She, not Tricolor, had to pay for it. She rented a car to get to work, but it was too expensive. Without her car, she couldn\u2019t go to work. She lost her job. The car was repossessed.<\/p>\n

\u2018Predatory\u2019<\/p>\n

Founder and CEO Daniel Chu told me in a 2024 interview that he knew his industry \u201chas a very bad reputation \u2026 predatory. Taking advantage of people.\u201d<\/p>\n

He told me he counters that: \u201cWe try very hard to build a reputation that provides value to the customer and treats the customer with enormous respect.\u201d<\/p>\n

Chu added, \u201cWe\u2019re the good guys.\u201d<\/p>\n

The company\u2019s lawyer, Andrew DeLuca, told me in 2024 he offered Jackson a refund, but it came with a nondisclosure agreement that, among other requirements, demanded she retract comments she made in interviews with The Watchdog. She refused to sign, she said.<\/p>\n

Cockroaches<\/p>\n

One of the biggest lenders was JPMorgan Chase. CEO Jamie Dimon said his company investigated its involvement in \u201cthe cold light\u201d and didn\u2019t like what it found.<\/p>\n

\u201cNot our finest moment,\u201d he said.<\/p>\n

\u201cI shouldn\u2019t say this,\u201d he told financial analysts in a phone call. \u201cBut when you see one cockroach, there\u2019s probably more. Everyone should be forewarned.\u201d<\/p>\n

\"JPMorgan<\/p>\n

JPMorgan CEO Jamie Dimon had harsh words about Tricolor. He compared company leaders to cockroaches.<\/p>\n

Richard Drew \/ AP<\/p>\n

File complaints<\/p>\n

Jackson and her husband, Kevin Kiepe, realized that something was rotten at the company. They complained to the governor\u2019s office, the attorney general, the Better Business Bureau, any agency they could think of.<\/p>\n

They also alerted journalists. (The Watchdog was the only one who covered their case.)<\/p>\n

Two titles, one car<\/p>\n

The bankruptcy filing showed the company had more than a billion dollars in assets and $1 billion in liabilities, plus 25,000 creditors. One of them, JPMorgan, reported a $170 million charge.<\/p>\n

Although the company is shuttered, car loan payments are still expected.<\/p>\n

The company website states, \u201cWe are no longer offering financing or sales service. If you are an existing customer please continue making your payments.\u201d<\/p>\n

The Texas Department of Motor Vehicles is investigating complaints about Tricolor, spokesperson Adam Shaivitz said.<\/p>\n

The Dallas Morning News and other media outlets have reported that the U.S. Department of Justice is investigating Tricolor for fraudulent activity. Some vehicles had two titles on them, something not permitted because it misleads lenders.<\/p>\n

In the car business, that\u2019s called double flooring or double pledging. Almost 30,000 Tricolor car owners are driving vehicles with two titles \u2014 but they don\u2019t know it.<\/p>\n

Jackson told me \u201cevery door I tried to open to get justice was slammed in my face.\u201d<\/p>\n

When the bankruptcy was announced, she said, \u201cit stopped me cold.\u201d<\/p>\n

\u201cThe financial impact has been devastating. I am still out $26,000. I ended up homeless in Dallas because I had no car, no income. What I went through felt like fraud from the beginning.\u201d<\/p>\n

Her husband said, \u201cThe warning bells were ringing, but nobody paid attention.\u201d<\/p>\n

Until now, when it\u2019s too late.<\/p>\n

Tricolor also operated under the names of Ganas and Ganas Ya.<\/p>\n

In the Know<\/p>\n

Buyers experiencing issues with a Texas dealer may file a complaint with the department of motor vehicles at www.TxDMV.gov\/complaints<\/a>. <\/p>\n

For concerns related to dealer financing, buyers may file a complaint with the Office of Consumer Credit Commissioner<\/a>, the state agency responsible for regulating motor vehicle financing.<\/p>\n

Source: Texas DMV<\/p>\n","protected":false},"excerpt":{"rendered":"Cynthia Jackson came to me a year ago with a complaint about how she was treated by Tricolor,…\n","protected":false},"author":2,"featured_media":64017,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9],"tags":[10448,2353,102,104,103,27,10322],"class_list":["post-64016","post","type-post","status-publish","format-standard","has-post-thumbnail","category-dallas","tag-autos","tag-commentary","tag-dallas","tag-dallas-headlines","tag-dallas-news","tag-texas","tag-watchdog"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/posts\/64016","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/comments?post=64016"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/posts\/64016\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/media\/64017"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/media?parent=64016"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/categories?post=64016"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/tags?post=64016"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}