WASHINGTON, Jan. 14 (UPI) — The U.S. Department of Justice on Friday announced a settlement with Takata Corp. in which the Japanese auto parts-maker will plead guilty to fraud and pay $1 billion for hiding a defect that has contributed to the deaths of at least 17 people.
Takata had been under investigation for purportedly falsifying critical safety data in an attempt to hide flawed devices it makes to inflate airbags, which are installed in millions of vehicles worldwide. At least 17 deaths have occurred due to the devices, federal authorities say.
Those killed and injured were harmed by flying shrapnel propelled by the airbags, which are inflated with ammonium nitrate.
Federal officials said Takata first became aware around 2000 that the devices weren’t operating properly, but falsified critical safety data to cover up the problem. More than 70 million flawed inflators have been recalled, the most for one defect in U.S. history.
“For more than a decade, Takata repeatedly and systematically falsified critical test data related to the safety of its products, putting profits and production schedules ahead of safety,” Andrew Weissmann, fraud chief in the Justice Department’s Criminal Division, said.
“If they choose instead to engage in fraud, we will hold accountable the individuals and business entities who are responsible,” U.S. Attorney Barbara McQuade said in a statement.
The Justice Department added Friday that three Takata executives have also been indicted for the fraud — Shinichi Tanaka, 59; Hideo Nakajima, 65; and Tsuneo Chikaraishi, 61. Each of the men was indicted by a federal grand jury on Dec. 7, and face one count of conspiracy to commit wire fraud and five counts of wire fraud.
Officials said Takata had cooperated with federal investigators in the case, which eased some of the penalties, but noted that the severity of the violations and the fact they had occurred for more than 15 years required serious punitive measures.
Word that Takata was nearing a settlement with the U.S. government was first reported last month.
The $1 billion in penalties includes $975 million in restitution and a $25 million fine. The people injured by the faulty airbag devices will receive $125 million of the restitution, and the remaining $850 million will go to auto manufacturers who incurred great expense as the result of Takata’s fraudulent conduct.
