Toyota to settle with Justice Department for $1 billion

The settlement comes weeks after General Motors finds itself at the center of a congressional, criminal and NHTSA investigation into faulty ignition switches.
By Ananth Baliga  |  March 19, 2014 at 8:19 AM
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WASHINGTON, March 19 (UPI) -- The Justice Department is expected to announce a billion-dollar settlement with Toyota to end a criminal investigation into the handling of safety problems.

The settlement is expected to be announced as early as Wednesday, and would end the four-year investigation into Toyota's handling of customer complaints related to unintended acceleration. Under the settlement, Toyota will not face criminal charges, provided it meets certain conditions imposed by the court. An outside observer will be appointed to monitor Toyota's adherence of the agreement.

"Toyota has cooperated with the U.S. attorney's office in this matter for more than four years," a Toyota spokeswoman said. "During that time, we have made fundamental changes to become a more responsive and customer-focused organization, and we are committed to continued improvements."

The settlement still isn't final and could fall apart, people close to the matter said.

The investigation was initiated by the Manhattan offices of the Federal Bureau of Investigation and the U.S. Attorney, and looked at how Toyota reported cases related to the unintended acceleration.

The problem came to the fore in 2009, after an off-duty California Highway Patrolman and his family steered off a highway after their car accelerated to 120 mph. A 911 call made by one of the passengers highlighted the frantic efforts of the driver to stop the car.

Toyota was accused of ignoring its own internal audits and making misleading statements about safety issues. Toyota initially disputed claims by complainants, saying that the problem was linked to misplaced floor mats trapping the accelerator pedal in some cases.

The National Highway Traffic Safety Administration was also criticized for its handling of the matter in the years leading up to the recall that involved nearly 5 million cars.

The Manhattan U.S. Attorney's office is now investigating General Motor's recall of over 3 million cars, some of which are related to faulty ignition switches, which led to at least 31 accidents and 12 deaths.

[Wall Street Journal] [CNN]

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