Don Hankey, the chairman of the Hankey Group of Companies in Los Angeles, including an insurer, a subprime auto lender, and a commercial real estate investment firm, has provided Donald Trump with a $175 million appeal bond when other insurers would not. Hankey, a self-made billionaire worth $7.4 billion, has accumulated his wealth by lending to borrowers that other financial firms avoid. Despite his success, some of Hankey’s companies have drawn scrutiny from regulators in recent years. For example, the U.S. Justice Department has taken action against Hankey’s big subprime auto lender, Westlake Financial, for illegally repossessing vehicles owned by military service members and for failing to provide interest rate benefits to service members as required by law.
While Hankey’s financial entities control $18 billion in assets and employ over 3,000 individuals, his companies have faced numerous consumer complaints filed against Westlake with the federal Consumer Financial Protection Bureau. Customers have alleged that Westlake engaged in various questionable practices, such as improperly repossessing vehicles, imposing charges on loans not agreed to by customers, and withholding accurate loan balance and payment histories from credit reporting agencies. These types of inaccuracies can severely impact consumers’ ability to secure other loans, lease residences, or even obtain jobs. Additionally, customers who fall behind on their auto loans have reported receiving repeated calls from Westlake employees, causing further distress to borrowers.
Hankey’s companies, including Westlake and KnightBrook Insurance, have also faced regulatory actions by the Consumer Financial Protection Bureau and the California Department of Insurance for their practices. In 2015, the CFPB lodged a consent decree against Westlake and Wilshire Commercial Capital, another of Hankey’s companies, for pressuring borrowers with illegal debt collection practices, resulting in 176,000 affected customers. The CFPB found that Westlake and Wilshire changed loan terms without informing borrowers, leading to additional interest charges on their loans. Moreover, the companies allegedly misled customers by using deceptive caller IDs and pretending to be employees from unrelated businesses to trick borrowers into revealing information that could lead to repossession.
KnightBrook Insurance, another Hankey company, was cited by the California Department of Insurance in 2015 for multiple violations related to the handling of customer claims. These violations included failing to include fees in total loss settlements, not conducting thorough investigations of claims, and neglecting to pay salvage certificate fees and reasonable towing charges. KnightBrook agreed with the state’s findings and promised to implement corrective actions in applicable jurisdictions. Despite these regulatory issues, Hankey’s companies continue to operate and serve a large customer base.
Hankey’s wealth and success in lending to customers underserved by traditional financial institutions have made him a prominent figure in the business world. His decision to provide Trump with an appeal bond to delay the collection of a $464 million judgment in a civil fraud case has garnered attention, further elevating his profile. While Hankey’s business practices have come under scrutiny by regulators and consumer advocates, his companies remain a significant player in the financial landscape, with billions in assets and thousands of employees. It remains to be seen how Hankey will navigate regulatory challenges and maintain his successful track record in the years to come.
