Penalty Amount
$694,000,000
Connecticut Attorney General William Tong joined 40 other state attorneys general in a settlement with Credit Acceptance Corporation (CAC), one of the nation's largest subprime auto lenders, resolving allegations that CAC originated loans it knew or should have known consumers could not afford and encouraged or failed to prevent dealers from 'packing' CAC loans with unwanted Vehicle Service Contract (VSC) and GAP products. The settlement, announced September 17, 2026 and effective November 2, 2026, directs $694 million in cash restitution and debt relief to consumers, plus an additional $15 million to the states, and imposes injunctive lending reforms. Note: this is a consumer-protection/lending enforcement action rather than a data privacy matter; the violation categories are best-fit mappings to the available taxonomy.
CAC will direct $694 million in consumer relief: $60 million in cash restitution to consumers who received particularly risky loans, $388 million in debt relief for consumers whose cars were repossessed, and $246 million in debt relief for consumers whose cars were not repossessed (allowing them to keep their cars), for certain risky loans made between November 1, 2015 and November 30, 2025, due on or before November 2, 2026. CAC must also pay an additional $15 million to the attorneys general; Connecticut consumers are eligible for up to $2 million in relief in addition to a $177,650 payment to the state. Injunctive terms require: 'off ramps' providing 95% debt relief and prohibiting collections lawsuits for certain loans made starting December 2025 that fail quickly (five-year period beginning November 2, 2026); a process to prevent unlawful VSC and GAP packing including enhanced pre-purchase disclosures, post-purchase alerts with easier product cancellation, and dealer monitoring; pre-loan disclosures about default risks and vehicle value; a seven-year price cap at 109% of retail book value for certain consumers; and processes preventing dealers from raising prices based on creditworthiness or above advertised prices.
This is a consumer-protection lending case rather than a data privacy matter, but it carries significant contract implications for auto lenders, finance companies, and any business operating through dealer or origination partner networks. In-house teams should review dealer agreements and origination vendor contracts for: (1) compensation structures and incentive clauses that could encourage 'packing' of add-on products such as Vehicle Service Contracts and GAP waivers; (2) dealer oversight, monitoring, and audit rights sufficient to detect unlawful add-on sales practices; (3) representations and warranties requiring enhanced pre-purchase disclosures, post-purchase consumer notifications, and easy add-on product cancellation processes; (4) loan origination standards including ability-to-repay representations and pre-loan disclosures of default risk and vehicle value; (5) pricing provisions, including any terms permitting price increases based on creditworthiness or above advertised prices (the settlement imposes a 109% of retail book value cap for certain consumers); and (6) collections and repossession conduct standards. Customer-facing loan agreements and retail installment contracts should also be checked for clear disclosure language about optional products, and indemnification clauses should ensure dealers bear responsibility for packing-related violations.
Entity
Credit Acceptance Corporation
Industry
Financial Services"a settlement with Credit Acceptance Corporation (CAC) to direct $694 million in cash and debt relief to consumers in connection with their car loans"
"$694 million in cash and debt relief to consumers"
"CAC must also pay an additional $15 million to the attorneys general."
"Connecticut consumers will be eligible for up to $2 million in financial relief, in addition to a $177,650 payment to the state."
"The settlement, which will be effective as of November 2, 2026"
"Attorney General William Tong today joined 40 other state attorneys general announcing a settlement"
$700.0M
New York Attorney General Letitia James, leading a bipartisan coalition of 39 other states, the District of Columbia, and Hawaii's Office of Consumer Protection, secured a $700 million settlement from Credit Acceptance Corporation (CAC), a subprime auto lender, resolving allegations of deceptive and abusive lending. The lawsuit alleged CAC pushed tens of thousands of consumers into unaffordable loans with average interest rates above 38 percent, bundled with expensive add-on products consumers were told were mandatory or never told about, causing widespread defaults and vehicle repossessions. Note: this is a consumer-lending enforcement action rather than a privacy matter, so no privacy violation categories from the taxonomy apply.
$694.0M
Colorado and 40 other states entered into a settlement with Credit Acceptance Corporation (CAC), one of the nation's largest subprime auto lenders, resolving allegations that CAC originated car loans it knew or should have known consumers could not afford and that it failed to reasonably prevent dealers in its network from deceptively 'packing' Vehicle Service Contract and GAP add-on products into CAC-financed purchases. The settlement provides $694 million in cash and debt relief to consumers plus an additional $15 million to the attorneys general, and imposes injunctive reforms including loan 'off ramps,' enhanced pre-purchase and pre-loan disclosures, dealer monitoring, and a seven-year price cap at 109% of retail book value. Note: this is a consumer-lending enforcement action, not a data privacy matter; the 'dark_patterns' category is the closest available fit for the deceptive add-on sales allegations.
$694.0M
Virginia and 40 other state attorneys general settled with subprime auto lender Credit Acceptance Corporation (CAC) for $694 million in cash restitution and debt relief. The settlement resolves allegations that CAC originated loans it knew or should have known consumers could not afford, and that it encouraged and failed to prevent dealers from unlawfully 'packing' auto-loan contracts with unwanted Vehicle Service Contracts and GAP products. The Consent Judgment was filed September 17, 2026, with the City of Richmond Circuit Court.
$75.5M
Minnesota AG Keith Ellison and a bipartisan coalition of 41 state attorneys general reached a settlement with subprime auto lender Credit Acceptance Corporation requiring it to pay the states $75.5 million and forgive more than $630 million in consumer debt nationwide. The settlement resolves allegations that the company financed auto loans it knew or should have known consumers could not afford, and financed the sale of expensive add-on products that consumers did not know they were purchasing. The company must also fundamentally reform its lending practices, including risk disclosures, loan balance waivers for high-risk defaults, and enhanced consent and cancellation protections for add-on products.
$694.0M
Oregon Attorney General Dan Rayfield announced a $694 million multistate settlement with Credit Acceptance Corporation (CAC), a subprime auto lender, resolving allegations that CAC originated unaffordable loans and allowed dealers to 'pack' unwanted Vehicle Service Contracts and Guaranteed Asset Protection products into consumer loans. The settlement provides $60 million in cash restitution, $634 million in debt relief, and injunctive reforms including off ramps for risky loans, enhanced disclosures, and dealer monitoring.
Connecticut Attorney General William Tong issued an advisory that newly enacted privacy laws take effect October 1, 2026, including Public Act 26-64 (SB4), which amends the Connecticut Data Privacy Act, and Public Act 26-15 (SB5), which established the Connecticut Artificial Intelligence Responsibility and Transparency Act (CART Act). The new laws regulate surveillance pricing, facial recognition technology, genetic data collected by direct-to-consumer testing companies, a ban on the sale of precise geolocation data, a data broker registry, AI use in employment decisions, and chatbots offered to children. No enforcement action was taken; this is prospective guidance alerting consumers and businesses to new rights and compliance requirements.