The corporate watchdog says it has begun civil penalty proceedings in court against a unit of Volkswagen AG for allegedly not making appropriate checks while providing consumer loans.

The Australian Securities and Investments Commission (ASIC) alleges Volkswagen Financial Services Australia Pty Limited did not make reasonable inquiries or verify borrowers’ living expenses while providing 49,380 loan contracts.

Volkswagen operates across Australia to provide borrowers with consumer loans to buy new and used cars.

ASIC alleges these instances of breaches in lending laws occurred between December 20, 2013 and December 15, 2016.