GM to pay record $35M civil penalty for delayed action on faulty ignition switches
Posted May 16, 2014 03:27 pm CDT
General Motors has agreed to pay a $35 million civil penalty for delays in responding to defective ignition switches.
The amount is the highest civil penalty every paid as a result of an investigation by the National Highway Traffic Safety Administration into recall violations, according to the Washington Post and a press release. The New York Times also has a story.
The defective ignition switch in Chevy Cobalts and other cars can change to the “accessory” position, disabling air bags and making steering and braking more difficult.
The consent order signed with the NHTSA also requires GM to make changes in its internal reviews of safety issues. The automaker will pay additional civil penalties for delays in responding to NHTSA’s document demands during the investigation.
GM admits in the consent order that it failed to comply with federal law requiring auto manufacturers to notify NHTSA within five business days of determining that a safety-related defect exists. The company has also agreed to give NHTSA full access to GM’s internal investigation into the delayed recall.The company hired Jenner & Block chairman Anton Valukas to help lead the investigation.
U.S. Transportation Secretary Anthony Foxx says in the press release that the $35 million maximum for such fines should be raised. “While we will continue to aggressively monitor GM’s efforts in this case, “ he said, “we also urge Congress to support our Grow America Act, which would increase the penalties we could levy in cases like this from $35 million to $300 million, sending an even stronger message that delays will not be tolerated.”