Top Executives at Subprime Auto Lender Tricolor Auto Charged with Fraud

Federal prosecutors allege a multi‑million‑dollar scheme

The United States Attorney’s Office announced criminal fraud charges against James L. Whitaker and Maria S. Delgado, the chief operating officer and chief financial officer of Tricolor Auto, a prominent subprime auto‑loan financier. Prosecutors allege the duo orchestrated a scheme that inflated loan values, falsified borrower information, and siphoned millions of dollars from the company’s loan portfolio.

Previous guilty pleas deepen the investigation

Two other senior managers at Tricolor Auto have already entered guilty pleas to related offenses. In March 2024, Kevin R. Haines, the former director of underwriting, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 24 months in prison. Linda M. Park, the former head of collections, admitted to falsifying repayment records and received a 18‑month sentence.

Details of the alleged fraud

According to the indictment, Whitaker and Delgado directed staff to:

• Overstate the market value of used vehicles used as collateral, often by as much as 30 %;
• Submit fabricated income statements and employment verification for borrowers who did not meet credit criteria;
• Manipulate the loan‑servicing software to hide delinquent accounts from auditors.

The false information enabled Tricolor Auto to secure financing from investors and banks under the pretense of a healthier loan book, resulting in an estimated $45 million in illicit gains.

Legal proceedings and potential penalties

Whitaker and Delgado were arrested on June 12, 2025, and are each facing up to 20 years in federal prison, fines, and restitution to the victims. Their arraignment is scheduled for July 8, 2025, after which a pre‑trial hearing will determine whether they will be released on bond.

Company response and industry impact

Tricolor Auto released a brief statement saying it is “cooperating fully with law‑enforcement authorities” and that “the alleged actions do not reflect the values of the broader organization.” The case has sparked renewed scrutiny of the subprime auto‑lending sector, with regulators warning that similar practices could threaten consumer protection and financial stability.

What’s next?

Federal investigators continue to examine Tricolor Auto’s loan files and are expected to subpoena additional executives. The Department of Justice has indicated that further charges could be filed as the probe expands, potentially implicating other high‑ranking officials within the company.