---
title: "Justice Department Questions BMW Over Military Lease Actions"
description: "Active duty personnel are supposed to be protected by law from repossessions - but some companies get away with it. Now the Justice Department is looking into whether BMW might be one of them."
date: "2017-03-15"
modified: "2017-03-15"
authors:
  - name: "Kyle Cheromcha"
    job_title: "Editor-in-Chief"
    link: "https://www.thedrive.com/authors/kyle-cheromcha"
url: "https://www.thedrive.com/article/8340/justice-department-questions-bmw-over-military-lease-actions"
categories:
  - "News"
tags:
  - "auto loans"
  - "BMW"
  - "financing"
  - "Justice Department"
  - "Military"
  - "repossession"
  - "wells fargo"
---

# Justice Department Questions BMW Over Military Lease Actions

![](<https://www.thedrive.com/wp-content/uploads/images-by-url-td/content/2017/03/bmw.png>)
*\<em\>www.thedrive.com</em>*

The U.S. Department of Justice has questioned BMW’s leasing arm over its actions regarding overdue payments from active duty military members, according to a [documents obtained by Bloomberg](<https://www.bloomberg.com/news/articles/2017-03-13/u-s-probes-bmw-s-handling-of-auto-leases-to-military-personnel>). Though it's unclear what drew officials' attention, auto lenders are increasingly being targeted for violating the [Servicemembers Civil Relief Act](<https://www.military.com/benefits/military-legal-matters/scra/servicemembers-civil-relief-act-overview.html>), which requires them to seek a court order before repossessing an active duty military member’s vehicle. BMW Financial Services says it is unsure just how many of its leases fall under the reach of the SCRA and refused to comment further.

But news of the inquiry comes amidst rising concern over the [ongoing explosion of subprime auto loan debt](<https://www.businessinsider.com/mizuho-on-subprime-auto-lending-conditions-2017-3>) in this country. And while this appears to be the first review involving a manufacturer’s financing branch, some big-name banks and lenders have recently been targeted for SCRA violations and other questionable practices.

Last year, the Justice Department [fined Wells Fargo $24 million](<https://www.latimes.com/business/la-fi-wells-fargo-military-cars-20160929-snap-story.html>) over its illegal**​** repossession of 413 cars of active duty members dating back to 2008. The investigation stemmed from a single incident in 2013 where the bank repossessed an Army National Guardsman’s used Ford Escape while he was preparing to deploy to Afghanistan. Upon returning, he was also served with a $10,000 balance even though the bank had sold his vehicle at auction.

The Justice Department also went after Santander Consumer USA, the country’s largest subprime auto lender, [hitting them](<https://www.justice.gov/opa/pr/justice-department-reaches-settlement-santander-consumer-usa-resolve-allegations-concerning>) with a $9.35 million fine in 2015 over similar allegations involving over 1,000 military members’ cars. [HSBC Holdings and Capital One Financial Group](<https://www.bloomberg.com/news/articles/2016-09-29/wells-fargo-troubles-mount-with-penalty-for-soldiers-car-loans>) have also been punished for violating the SCRA.

So even though the law is on the books, it seems clear companies can get away with ignoring it until someone speaks up.

## Author
Overseeing an expert staff of writers and editors from his lair in Los Angeles, Kyle shapes The Drive’s singular approach to covering the automotive industry and car culture. He’s been with the site as a writer since 2017, taking over as editor in 2019. On a daily basis, Kyle is responsible for directing The Drive's editorial news and car review content strategies, setting special coverage priorities, managing complex reporting projects, and ensuring what you read on the page meets our high internal standards for quality and trustworthiness. He is also the executive producer of The Drive's YouTube channel, which was relaunched in February 2024 to great acclaim and has accumulated over 14M new views in its first year back on the scene. He hosts a biweekly series on the channel where he breaks down fascinating and complicated stories from the automotive world.

### Author social links  
[Bluesky](<https://bsky.app/profile/kylecheromcha.bsky.social>)  
[Instagram](<https://www.instagram.com/kylecheromcha>)  
[LinkedIn](<https://www.linkedin.com/in/kyle-cheromcha-1550248a/>)