Hyundai finance unit accused of illegally seizing U.S. soldiers' cars

Hyundai and Kia's American financing arm repossessed more than two dozen vehicles leased by U.S. military service members without first getting court orders, as legally required, federal prosecutors alleged on Wednesday.

Hyundai Capital America, a wholly-owned subsidiary of Hyundai Motor America and Kia America, violated the Servicemembers Civil Relief Act between 2015 and 2023 by reclaiming 26 vehicles owned by service members who began paying off their loans before starting active duty, according to a lawsuit filed by the Department of Justice in federal court in Los Angeles.

In 2017, for instance, Hyundai Capital America seized and sold a a three-year-old Hyundai Elantra belonging to Navy Airman Jessica Johnson after determining that she was on active duty but "not deployed," according to legal documents. Johnson still owed $13,769 on the car, and the company realized in 2020 it should not have repossessed the vehicle, according to the complaint.

Irvine, Calif.-based Hyundai Capital America did not immediately respond to a request for comment.

Members of the Armed Forces should not suffer financial hardship due to their service, according to the Department of Justice, which in recent years has settled similar claims against the finance arms of General Motors, Nissan and Wells Fargo.