The carmaker Wednesday confirmed to CBS News it knew ignition switches in the Chevrolet Cobalt and five other cars were defective. It did not report this information to the National Highway Traffic Safety Administration until 2005.
The FBI and the U.S. Attorney's Office in New York have opened a criminal investigation into GM on whether the company violated a law that requires carmakers to give the federal government timely notice of defects, CBS News reported.
"The law said five days, not five years, not 10 years, and we're going to find out why the law may not have worked the way that it was intended," Michigan Rep. Fred Upton said.
GM is also facing a Justice Department investigation into its handling of the global recall of 1.6 million vehicles with faulty ignition switches. The faulty parts have been linked to 12 deaths.
NHTSA, which has received criticism for not acting sooner to recall GM vehicles with the defective equipment, said if it had received better data that linked defective ignition switches and failing air bags in GM vehicles, it would have been more aggressive in the case.
The issue with the switches was brought to light in 2007 at a NHTSA meeting with GM executives. The agency did not start an investigation into the defect at that time.
"We took several efforts to look into this data," David Friedman, acting administrator for NHTSA, told Bloomberg Wednesday. "At the end of the day, with the data we had at that time, we didn't think that was sufficient to open up a formal investigation."
GM said it is working with investigators.
"We are fully cooperating with NHTSA, and we welcome the opportunity to help the agency have a full understanding of the facts," GM spokesman Greg Martin said.
Meanwhile, GM is offering a $500 cash allowance toward a new car to U.S. owners of the recalled cars, Automotive News reported.
GM notified its dealers March 4 of the cash offer, and advised them to offer loaner vehicles to customers concerned about the faulty ignition switch.
"GM will not market or solicit owners using this allowance," read the notice, which was published on the NHTSA website Wednesday. "We ask that you not market to or solicit these customers either. This allowance is not a sales tool; it is to be used to help customers in need of assistance."
The allowance is good for any 2013-15 model year Chevrolet, Buick, GMC or Cadillac.