They Can't Be Beat

Gruskin alleges that the fraudulent loan application in the McKay case was ginned up by the finance manager at AutoNation's dealership in Clearwater. Not only that, but he claims the contract for the Hummer was forged by the dealership.

AutoNation's Cannon counters that a handwriting expert has concluded the signature is McKay's and blames another independent broker, or bird dog, for the application fraud.

A jury is expected to decide the truth at trial in the coming months. Meanwhile, AutoNation and other dealerships are still issuing high-interest sub-prime loans. Cannon, the company's spokesman, claimed that the number of sub-prime loans is "tiny."

That's not quite what Mike Maroone, the longtime South Florida car dealer who is AutoNation's president, told financial analysts at the company's February 7 earnings call.

"Our prime is generally 80 percent or more; subprime is 20 percent or less," Maroone said. "It does vary greatly by market. There is still subprime financing out there... I don't mean to insinuate that the faucet has been shut off... It's just a little bit more conservative than it was."

That may be the best we can hope for.