Tricolor Holdings founder Daniel Chu received almost $30 million in compensation during the year prior to the subprime auto lender’s collapse amid alleged fraud, according to a document filed by the trustee overseeing the company’s liquidation.
Chu “defrauded Tricolor by using corporate funds for lavish personal expenses and pressuring the company to pay him tens of millions of dollars in bonuses (in addition to his executive salary),” trustee Anne Burns stated in a court filing last week. That pay was “based on his purported ability to deliver exceptional financial results—results that were the product of the fraud.”
The payments helped fund what the trustee described as an opulent lifestyle, including luxury homes in Dallas, Beverly Hills, and Miami worth roughly $38 million combined, along with private-jet travel and European vacations.
“Many of the allegations made against Mr. Chu in recent days are inaccurate and deeply misplaced, and this will become clear when the true facts emerge,” Matthew Schwartz, an attorney for Chu, said in a statement. “We look forward to a full and fair hearing in court.”
Last week, U.S. prosecutors charged Chu and the company’s former chief operating officer with running Tricolor through “systemic fraud.” Two other former executives have pleaded guilty to fraud charges.
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Over the years, Chu charged millions of dollars to his business card, the trustee alleged—including for skin revitalization treatments, vitamin infusions, and dental work. He also frequented high-end restaurants like Nobu in New York and Carbone in Dallas, according to the filing.
The trustee claimed Chu continued using corporate funds for personal expenses even after he knew the company was in financial distress. For example, as late as August 2025, Chu put an $18,000 charge on his American Express card for membership to Core Club, a social club in New York, the suit states.
In emails attached to the suit, Chu told an auditor and board members in 2023 that he was under “over the top” stress when questions arose about his personal spending. “So regarding expenses for my family to accompany me on travel, household costs like a nanny, or IV treatments—this provides some context for me,” Chu wrote in one email.
“I do feel like I’ve used good judgment with these expenses,” Chu said in another email cited in the suit.
Compensation Fight
For years, Chu lobbied the board for compensation increases, citing the company’s revenue and sales growth since 2018, the trustee alleged.
In 2022, a consultancy hired by Tricolor’s board found Chu’s pay aligned with the average for private U.S. companies. But Chu wanted to be compensated at the 10th percentile of public companies—even though Tricolor was not a public firm.
The board pushed back, according to emails referenced in the lawsuit. Chu called the compensation committee process “grossly mismanaged” and referred to one board member as a “top imbecile” for challenging the pay package, filings show.
Using his role as the sole manager of Tricolor’s majority shareholder, Chu removed three board members who opposed his compensation requests, the trustee claimed.
Days after the board approved his pay in February, Chu agreed to buy a $25 million ski chalet in Aspen, Colorado, according to the lawsuit. The deal fell through after Tricolor filed for liquidation, with Chu forfeiting a $1.75 million deposit.
(Updates with detail on Core Club in seventh paragraph.)