NY Times: Justice Dept. Finds 'Criminal Wrongdoing' at GM

VOA News
May 23, 2015 12:40 AM

Giant automaker General Motors could be on the verge of paying a record penalty for failing to reveal an ignition defect in its vehicles linked to at least 104 deaths, according to a report Friday in The New York Times.

GM's settlement payment is still being negotiated, but is expected to surpass the $1.2 billion Toyota paid last year for failing to reveal unintended acceleration problems in its vehicles, the newspaper's unnamed sources said.

The Times said the U.S. Justice Department has identified "criminal wrongdoing" in GM's failure to disclose problems with the ignitions that could unexpectedly shut off engines. The company's faulty ignitions and other problems resulted in GM recalling more than 30 million vehicles last year, a record for the company, the report said.

The New York Times said GM's "eagerness to resolve the investigation" will likely earn the carmaker a "cooperation credit," making the penalty it pays "somewhat smaller" than if GM had declined to cooperate.

GM's cooperation with the investigation contrasts with Toyota, which fought prosecutors.

Last year, GM, paid "an estimated $3 billion" on recalls and other safety issues, according the the report. That amount included $600 million set aside to compensate switch-related accident victims and their families.

The Times said GM has paid the National Highway Traffic Safety Administration a $35 million fine for failing to report the faulty ignition problem in "a timely manner."

The New York Times said GM has been required since last May to report periodically to regulators about its safety practices.

The newspaper said former GM employees are under investigation and could face criminal charges.