General Motors, the largest US automaker, is facing increased scrutiny over the failure to address a defective part for more than a decade leading to a 2.6 million cars initial recall – and others subsequently.
The US automaker is facing a serious public scandal because of the ignition switch debacle, which led to public outrage, a 13-person death toll, numerous federal probes and a mountain of litigations. In a move that is rarely seen when talking about a corporation, the US federal prosecutors are also pursuing a criminal case against the company, with several people that have knowledge of the proceedings telling Reuters the latest developments.
The sources say the prosecutors are now focused on bringing a criminal fraud case that heavily relies on the alleged misleading statements coming from General Motors. The federal criminal investigators are now examining the automaker’s activity as far as a decade ago, working on a set of mail and wire fraud charges, which closely resemble a case brought against Toyota. The Japanese company settled the charges, which demonstrated it mislead both US buyers and federal regulators on the well-known unintended acceleration issue.
The federal investigation is also doubled by at least a dozen US state investigations, with the latter probe most probably focusing on consumer protection law issues, according to other sources.
by Aurel Niculescu
) - Monday, July 14th, 2014 - filed under General Motors
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