Toyota to pay $1.2 B to settle criminal probe

Toyota to pay $1.2 B to settle criminal probe

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Toyota to pay $1.2 B to settle criminal probe

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by Chris Woodyard, and Kevin Johnson, USATODAY

KING5.com

Posted on March 19, 2014 at 7:02 AM

Updated Wednesday, Mar 19 at 7:02 AM

The Justice Department announced Wednesday that Toyota will pay $1.2 billion to settle a criminal probe of its handling of the reports of unintended acceleration in its vehicles and subsequent recalls beginning in 2009.

The settlement -- the largest criminal penalty imposed on a car company in U. S. history -- was announced by the Justice Department and Toyota this morning.

"Today we can say for certain that Toyota intentionally concealed information and misled the public about the safety issues behind these recalls," Attorney General Eric Holder said in announcing the settlement.

"Put simply, Toyota's conduct was shameful," he said.

The investigation was spearheaded by the U.S. Attorney's office and FBI in New York.

Christopher P. Reynolds, chief legal officer, Toyota Motor North America, said in a statement this morning: "At the time of these recalls, we took full responsibility for any concerns our actions may have caused customers, and we rededicated ourselves to earning their trust. In the more than four years since these recalls, we have gone back to basics at Toyota to put our customers first."

The criminal probe was independent of lawsuits and federal safety regulator and congressional probes of the Toyota sudden acceleration recalls and looked strictly at whether Toyota provided false or incomplete statements to the National Highway Traffic Safety Administration. It also looked at how it handled complaints.

Toyota has already paid $1.6 billion to car owners in the cases. and paid federal fines of $16.375 million in 2010 and a $17.35 million fine in 2012 for delays in safety defect reporting to NHTSA.

"While the $1 billion price tag represents a costly resolution, Toyota can put this issue behind it to fully focus on current and future challenges in a highly competitive market," says Karl Brauer, senior analyst for Kelley Blue Book, in a statement.

The cases involve instances in which Toyota accelerated when the drivers did not intend it, in essence, becoming runaway cars. After an off-duty California Highway Patrol officer and three passengers in a Lexus ES were killed near San Diego in 2009, other reports surfaced.

Toyota blamed floor mats that can jam under the gas pedal and potentially sticky accelerator mechanisms in several models and did multiple recalls covering both problems.

Safety experts also alleged that there were problems with the vehicles' engine electronics. But an extensive investigation by federal safety regulators found no evidence that that the electronics were at fault for unintended acceleration.

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