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
4/8/2010 10:23:18 AM
Look let me just calm myself...
I am not an anarchist. (FYI that post is fallacy.)
Do you think this is not a case of the US gov't taking a swipe at Toyota (for whatever reason)?
I would think that the max penalty would be for some company who intentionally endangered people on our road ways. Not someone who showed enough concern as to try to fix the problems.
But even if you don't agree, that is fine. My opinion is that the gov't is doing TOO MUCH here. I am not calling for the head of LaHood or his department.
"What would I do? I'd shut it down and give the money back to the shareholders." -- Michael Dell, after being asked what to do with Apple Computer in 1997
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
2017 Porsche Panamera: I’ll Take Three of These.
July 24, 2016, 6:44 PM
Ford, Toyota, and Universal Pictures Celebrate "Back to the Future Day' in Style
October 21, 2015, 4:19 PM
Consumer Reports Flexes Muscle, Hits Slumping Tesla Motors Stock
October 20, 2015, 4:13 PM
Debunked: Beneath the Lies, Nigerian "Pee Generator" Is Still Pissing Into the Wind
October 19, 2015, 7:53 PM
Hot Air? President Obama, G7 Pledge to Eliminate Most Fossil Fuel Use by 2100
June 8, 2015, 5:40 PM
Study Predicts Self-Driving Vehicles Could Rake in Billions
March 6, 2015, 8:34 AM
Most Popular Articles
Say Goodbye to Data Plans - Sprint and T-Mobile offer Unlimited Data
August 22, 2016, 6:12 AM
Lenovo vs. Asus vs. HP - Best Laptop Under $500.00
August 19, 2016, 4:00 AM
Uber - Everyone's Autonomous Car Driver?
August 20, 2016, 6:01 AM
Get Ready to wait in line – iPhone 7 due September.
August 18, 2016, 7:15 AM
5 Healthy and Creative ways to add Fiber to your Diet By Monique C. Bethell, Ph.D.
August 18, 2016, 7:43 AM
Latest Blog Posts
Coming Soon - Drones and Airports
Aug 24, 2016, 12:40 PM
SolarCity’s Gigafactory: A Milesone in Emerging Technology by Lily Emamian - 15 August 2016
Aug 15, 2016, 6:30 AM
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
More Blog Posts
Copyright 2016 DailyTech LLC. -
Terms, Conditions & Privacy Information