Could GM Face Criminal Charges Over Defective Ignition Switches?
When General Motors recalled 800,000 cars because of defective ignition switches in February 2014, it was just the tip of the iceberg. By June 2014, the number of cars recalled by General Motors because of this issue had grown into the millions. Cars impacted by the recall dated back as far as the late 1990s. Consumers and federal agencies alike were appalled by the news that some GM employees knew of the issue as early as 2003 (and were aware that some deaths had been linked to the ignition switches since 2013), but failed to launch a recall until 2014.
In addition to outrage from the general public, several GM employees were called to testify before Congress about how the matter was handled. GM also received a $35 million fine from the NHTSA because of the delay in issuing the recall. Now General Motors could potentially be facing criminal charges in the matter.
The defective ignition switches had a flaw that could potentially cause the ignition to inadvertently switch into either the “Off” or “Accessory” position while the vehicle was being driven, causing power steering and power brakes to fail and cause airbags to not deploy in the event of an accident. GM fixed the problem with the ignition switch in 2007, but did not issue a recall for the older vehicles, leaving drivers at risk.
On June 30, 2014, GM announced they would start accepting claims from victims of accidents caused by the faulty ignition switches. Approved claims would be paid out of a victim compensation fund. They accepted applications from August 1, 2014 through January 31, 2015, during which time they received 4,342 applications. The claims are still in the process of being investigated, but as of May 2015, the defective ignition switches had officially been linked to over 100 deaths. They’ve also approved 12 cases where people sustained brain injuries, lost limbs, or were severely burned in accidents caused by the switches and approved another 172 claims for less serious injuries.
It isn’t yet known exactly what charges GM might be facing. Reuters reports federal prosecutors are focusing their case on whether or not GM used misleading statements about the defective ignition switches. It’s also not known whether or not federal prosecutors could press charges against individual employees of GM who knew the ignition switches did not meet safety standards even before the impacted cars were put into production.
If criminal charges are pressed against General Motors, they wouldn’t be the first auto maker to face them in recent years. In March 2014, Toyota reached agreement to pay $1.2 billion to settle criminal charges related to problems that could cause vehicles to accelerate unintentionally, even as the driver tried to stop the car. Due to the highly public nature of the ignition switch recall, some believe criminal charges being pressed against GM could potentially be even more costly than it was for Toyota.