G.M. May Face Criminal Charges Over Faulty Ignition Switches
A year ago, the automaker began recalling 2.6 million Chevrolet Cobalts and other small cars after it was discovered that a problem with the ignition switch could abruptly force the vehicle to turn off. That prompted GM to recall additional vehicles for safety reasons.
All told, about 30 million GM vehicles were recalled in 2014 — a record high for the automaker.
According to a report in the New York Times late Friday, a Department of Justice investigation has found criminal wrongdoing on General Motors’s part, which could lead to a record penalty, sources close to the case reportedly said.
The penalty is expected to eclipse the record high $1.2 billion Toyota paid out last year for concealing a problem with sudden accelerations in some of its vehicles.
Officials say at least 104 deaths have been linked to the ignition defect so far.
The American automaker has been cooperating with federal officials in this matter, which will almost assuredly lessen the penalty, analysts believe. But it is still expected to be severe, given the seriousness of the defect’s impact.
A settlement in the case could be reached as soon as this summer, the Times report said.
Several General Motors employees, who were fired last year in the wake of the ignition switch problem, might also be targeted by the Justice Department.
Justice officials and GM are reportedly negotiating exactly what misconduct the automaker will admit to. Authorities have been looking into the case for more than a year, trying to determine whether the company tried to hide the problem and mislead investigators.
Officials are also reportedly looking into whether GM committed fraud in 2009 bankruptcy proceedings by not disclosing the ignition switch problem.
