Former Tricolor chief pleads guilty in auto loan fraud case

Former Tricolor Holdings chief operating officer David Goodgame pleaded guilty in Manhattan on Wednesday to fraud and conspiracy charges tied to the collapse of the subprime auto lender. He entered the plea before U.S. District Judge Kevin Castel and agreed to cooperate with prosecutors, a move that could help map how the company’s lending operation allegedly veered into criminal conduct.

Federal prosecutors say the case centered on a yearslong scheme to make Tricolor’s books look stronger than they were. The company allegedly falsified auto-loan data and double-pledged collateral, using the same assets more than once so near-worthless loans could appear to satisfy lender requirements. Prosecutors have said the fraud became part of Tricolor’s business strategy, not a side scheme, and that it harmed banks, investors, employees and customers.

The case has already drawn in several former executives. The December 17, 2025 indictment in the Southern District of New York charged Daniel Chu and Goodgame, while former chief financial officer Jerome Kollar and former finance executive Ameryn Seibold had already pleaded guilty on December 16, 2025 and are cooperating with the government. The Department of Justice and the FDIC Office of Inspector General have described the alleged conduct as bank fraud and wire fraud built around collateral that did not match reality.

Tricolor filed for Chapter 7 bankruptcy in September 2025 after shutting down more than 60 locations across the U.S. Southwest. Bloomberg Law reported that the company focused on undocumented immigrants in the region, operated about 60 retail locations, terminated more than 1,000 employees and left roughly 100,000 auto loans to be administered in bankruptcy. That liquidation was unusual for a company of this size, and it sent the unraveling of a used-car lender directly into court supervision.

The fallout reached major lenders including JPMorgan Chase, Barclays and Fifth Third Bancorp, which faced multi-million-dollar or nine-figure losses tied to Tricolor. The episode has underscored how quickly problems in high-risk consumer lending can spread when collateral controls, loan data and warehouse financing break down. Goodgame’s plea gives prosecutors another cooperating insider as they pursue the remaining questions around Tricolor founder Daniel Chu and the mechanics of a fraud that ran through the company’s lending machine.