Carvana $CVNA Fraud Comes To Light

Credentials: 14 year automotive veteran. 15 year retail stock and options trader. Not a financial professional or other advisor. Bullet Points: 1- Carvana is an online automotive retailer. Over the last 3 yrs CVNA has artificially inflated earnings by funneling bad loans onto affiliate businesses Bridgecrest and Drivetime 2- Bridgecrest and Drivetime are owned and controlled by CEO Ernest’s Garcia II’s father - convicted felon Ernest Garcia III. 3- In this three year window CVNA’s share price has risen from $4 to a January 2026 high of $490 4- CVNA has failed to report to shareholders that Bridgecrest and Drivetime have lost billions over this period, while CVNA has produced earnings that are artificially inflated by these “loan sales” 5- A recent short seller report reveals that Bridgecrest writes loans at an average rate of 22% indicating these loans are heavily subprime and vulnerable to default How is this illegal? Over the years Carvana has grown by vastly overpaying for vehicles, selling those vehicles at above market price, and burying subprime borrowers in loans that are egregiously higher than nominal Book values. Most banks will only lend a buyer 100-150% of a cars book value. When Carvana writes a loan they can use any lending standards they want, as they know Drivetime and Bridgecrest will “buy” the loan and take it off their books for a profit. This would be fine if Bridgecrest and Drivetime were not owned by the CEO’s family and associates. Or if the nature of this heavily one-sided relationship was disclosed to investors. In the meantime, due to this fraud and the risks it creates, I remain heavily bearish on CVNA. I am fully ready to disclose that I have current short option positions against CVNA. And my current price target (reflecting these overstated earnings) is $35 - $70 a share. (About 1/10th of today’s price)