Tricolor’s Chu, Goodgame Arrested, Indicted on Fraud Charges
The U.S. Attorney’s Office for the Southern District of New York announced the indictment of Tricolor Holdings (a.k.a. Tricolor Auto)’s founder and former CEO, Daniel Chu, and former COO David Goodgame, who were arrested by federal agents Tuesday and face charges of bank and wire fraud.
“As alleged in the indictment, CEO Daniel Chu was the leader of an elaborate scheme to defraud creditors of Tricolor,” writes U.S. Attorney Jay Clayton in a release. “At his direction, Tricolor repeatedly lied to banks and other credit providers, including by falsifying auto-loan data and ‘double pledging’ collateral. Fraud became an integral component of Tricolor’s business strategy.”
Tricolor, a used car retailer that doubled as a subprime finance source, collapsed into bankruptcy in September, which “harmed banks, investors, employees and customers,” Clayton adds.
Former Tricolor CFO Jerome Kollar and Ameryn Seibold, a former finance executive, have pled guilty and are cooperating with prosecutors, according to the release.
