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GM Recall Spurs DOJ, Congressional Probes

By Brett Snider, Esq. on March 12, 2014 | Last updated on March 21, 2019

The DOJ is investigating General Motors for allegedly failing to address dangerous safety problems for years before issuing a recall.

Federal prosecutors have been joined by members of Congress, who are beginning their own investigation and will conduct hearings on GM's culpability in allegedly waiting a decade to recall 1.6 million vehicles, reports The New York Times.

With so much federal scrutiny, this may be a rough year for GM.

Recall, Defect Investigation

It isn't uncommon or unseemly for auto manufacturers to issue recalls when a safety issue or defect is discovered.

In fact, auto companies are required to issue a recall for any vehicle or part that fails the minimum performance standards set by the National Highway Traffic Safety Administration, or whenever a safety-related defect is discovered. According to the Times, federal prosecutors are reviewing whether GM failed to disclose defects to federal regulators like NHTSA -- or even intentionally misled them.

At the center of this investigation is a safety defect in the ignition switch in more than 1 million GM vehicles from model years 2003 to 2007. This defect, which put more than three-quarters of a million American cars at risk, could cause engines to turn off while vehicles are in motion. The defect has been linked to at least six deaths, and prompted a massive recall by GM.

Investigators will attempt to figure out why GM allegedly failed to fix this defect for so long. The company may have known about the problem as early as 2004, reports the Times.

Criminal and Civil Charges Ahead

You may not think that executives can charged under criminal law for failing to issue a recall, but that's exactly what the top brass at GM could potentially be facing. Under the TREAD Act -- one made famous by the Firestone tire disaster -- any person who intentionally misleads federal regulators with respect to dangerous or deadly car defects can face up to 15 years in prison.

Anyone at GM who intentionally misled government officials regarding the ignition switch defect could be facing serious federal prison time.

Aside from that possibility, the company could also be held liable for millions in civil damages, if lawsuits are successful. However, anyone wishing to sue GM for defect-related injuries will likely need the charges approved by a bankruptcy court. According to Automotive News, when GM emerged from bankruptcy in 2009, it agreed to leave all pre-2009 defect issues with "Old GM" in a bankruptcy court.

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