Toyota Slammed With $16.4M USD Federal Fine For Defect Deception
April 5, 2010 9:10 PM
comment(s) - last by
(Source: Sting Ray Studios)
Toyota has recalled millions of vehicles, including the best-selling Camry for unintended acceleration problems. Toyota has now received a massive fine for trying to deceive U.S. federal regulators.
(Source: Torque Report)
Fine is largest in U.S. history against an automaker
The atmosphere at the U.S. Department of Transportation on Monday was tense as Secretary Ray LaHood
slammed Japanese automaker Toyota
. Lahood announced, "
We now have proof that Toyota failed to live up to its legal obligations
Worse yet, they knowingly hid a dangerous defect for months from U.S. officials and did not take action to protect millions of drivers and their families.
Defects are an automaker's eternal enemy. Every year thousands, if not millions of vehicles are recalled for defects. Toyota's critical problem was not so much the defects itself -- despite the
massive number of vehicles
involved. Rather, Toyota's key mistake was the dangerous game of deception it reportedly played.
According to documents obtained from Toyota, the company began a recall on
in September of last year in Canada and Europe. However, it failed to inform U.S. regulators of the problem, and made no effort to launch a recall of the effected vehicles until it came under heavy fire in January.
That constitutes a gross violation of federal safety guidelines, which demand that an automaker inform the U.S. federal regulators within five days of discovering a defect.
As a result, the DOT has thrown the book at Toyota, proposing a $16.4M USD, the maximum penalty allowed under the law. That fine far surpasses the biggest previous fine against an automaker -- $1M USD sum levied against General Motors
for failing to promptly recall windshield wipers in 2002-2003 model vehicles
Toyota has two weeks decide its response. Despite the reportedly conclusive evidence, the Asian automaker is expected to appeal the decision, perhaps seeking a smaller fine.
National Highway Traffic Safety Administration (NHTSA)
continues to investigate the sticky accelerators, unsatisfied with Toyota's claim that floor mats were solely to blame. NHTSA is looking at a host of mechanical and electrical elements for bugs, and is even examining whether
could play a role, with the
help of experts from NASA
The government continues to investigate Toyota's behavior during the recall, as well. DOT officials said more fines could brought against Toyota if further proof of wrongdoing is revealed.
While the defect mess is unpleasant for all those involved it does raise some interesting questions about governance. Some say that the government should not police companies, and that the commercial press should be left to investigate reports of defects and inform consumers of safety risk. Others argue the current system is a successful one. And still others argue that current regulation does not go far enough -- that the federal government should have the ability to levy even bigger fines against companies who knowingly make products that could endanger U.S. consumers.
135 pending lawsuits
against Toyota raise similar questions. Some argue that allowing such free litigation against safety critical businesses, such as automakers and healthcare providers allows citizens to take regulation into their own hands. Others argue that it hinders free enterprise, raising prices, and worse yet leads to bigger government.
This article is over a month old, voting and posting comments is disabled
RE: Still Confused
4/7/2010 1:53:24 PM
This article is talking about after the news bubble.
There were many many people saying Toyota might not be able to recover and such. The good sales ## just show that many people don't believe the hype of runaway cars.
"Vista runs on Atom ... It's just no one uses it". -- Intel CEO Paul Otellini
NASA, National Academy of Sciences to Investigate Unintended Acceleration
March 30, 2010, 10:57 AM
250 Lawyers Descend on San Diego for Toyota Lawsuits
March 25, 2010, 3:25 PM
Why the Feds Believe Extraterrestrial Rays Could be Messing With Toyota Vehicles
March 16, 2010, 4:03 PM
2008 Prius Takes Another Unlucky Driver on a Wild Ride
March 9, 2010, 6:00 PM
UPDATED: Toyota to Suspend Sales of Camry, Seven Other Models Over Unintended Acceleration
January 27, 2010, 5:43 PM
Study Predicts Self-Driving Vehicles Could Rake in Billions
March 6, 2015, 8:34 AM
Dual-Motor Tesla Model S P85D's "Insane Mode" Shocks Passengers
January 28, 2015, 11:18 PM
2016 Cadillac CTS-V Packs 640 hp Punch with 200 mph Reach
January 23, 2015, 3:25 PM
BMW Testing Tech to Allow Users to Auto-Park, Summon Cars Via Smartwatch
December 16, 2014, 9:30 AM
Lamborghini Offers Up $6,000 Leather-Bound Android Smartphone
December 12, 2014, 3:12 PM
Quick Note: GM Teases Next Generation Chevrolet Volt
November 20, 2014, 3:26 PM
Most Popular Articles
HTC One M9 Launches Tomorrow Overseas
March 20, 2015, 2:33 PM
Windows 10 Build 10041 Rolls Out: What's New in Pictures Pt. 1
March 19, 2015, 2:45 PM
FAA Grants Amazon Prime Air an "Experimental Airworthiness Certificate"
March 19, 2015, 9:14 PM
Samsung, Dell, Pegatron to Preinstall Microsoft Office 365 on Android Devices
March 23, 2015, 4:02 PM
Acer Iconia Tab 10 is a Bargain at $200 w/ WXGA, $250 w/ WUXGA
March 20, 2015, 2:11 PM
Latest Blog Posts
Sceptre Airs 27", 120 Hz. 1080p Monitor/HDTV w/ 5 ms Response Time for $220
Dec 3, 2014, 10:32 PM
Costco Gives Employees Thanksgiving Off; Wal-Mart Leads "Black Thursday" Charge
Oct 29, 2014, 9:57 PM
"Bear Selfies" Fad Could Turn Deadly, Warn Nevada Wildlife Officials
Oct 28, 2014, 12:00 PM
The Surface Mini That Was Never Released Gets "Hands On" Treatment
Sep 26, 2014, 8:22 AM
ISIS Imposes Ban on Teaching Evolution in Iraq
Sep 17, 2014, 5:22 PM
More Blog Posts
Copyright 2015 DailyTech LLC. -
Terms, Conditions & Privacy Information