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Another year, another bunch of huge fines for car makers. It's an inauspicious beginning for Honda, which just agreed to a $70 million settlement with the Department of Transportation over its failure to report deaths, injuries, and warranty claims to the federal government.
What did Honda do to draw the government's ire?
Not Reported Some Deaths, That's What
Between 2003 and 2014, Honda failed to report 1,729 death and injury claims to the National Highway Traffic Safety Administration (NHTSA), according to a NHTSA press release. Federal law requires car companies to report deaths, injuries, and warranty claims that raise "potential safety concerns" to the Department of Transportation.
Honda actually paid two separate violations: A $35 million violation for the death and injury reports, and a second $35 million violation for the warranty claims. Each violation is the maximum the government can levy; Congress limited fines to $35 million per violation.
For its part, Honda said the underreporting was due to "inadvertent data entry or computer programming errors." At the same time, however, Honda said some of the reporting came from third parties like police and private investigators, and it interpreted the law to exclude those reports, according to The Washington Post.
They're On to You
As you may recall, 2014 was a banner year for corporate fines. In November, Hyundai and Kia announced a $300 million settlement with the EPA over incorrect fuel efficiency certifications, the largest-ever Clean Air Act fine. AT&T settled a "cramming" lawsuit with the FTC for $105 million in October. The FCC fined Marriott $600,000 for jamming customer-owned Wi-Fi hotspots in order to induce them to rent hotspots from the hotel. And just making it into the record book by a few days, the French company Alstom agreed to plead guilty to FCPA violations and pay $772 million.
If you think you can get away with skirting some federal requirement, you might get away with it. Or you might not -- which may end up costing more than your company benefitted from the skirting.