GM to Pay $900M to Settle Criminal Case Over Ignition Switches

General Motors settled criminal charges Thursday over its faulty ignition switches.

U.S. Attorney Preet Bharara, however, did not rule out the possibility employees could still face charges.

In a statement on the settlement, GM said it would also cough up $575 million to settle some of the civil lawsuits it is facing.

GM’s current CEO, Mary Barra, who took over the position in 2014 before the recall erupted, has pushed a number of changes through the company relating to reporting and responsibility, in the hope of avoid a repeat of this incident.

“I am very sorry for the loss of life that occurred, and we will take every step to make sure this never happens again”, she said.

FBI Assistant Director-in-Charge Diego Rodriguez said, “we will no longer accept a business culture where expediency and the bottom line are put before the safety of people”. With the defect, some cars stalled, preventing air bags from deploying in crashes. Although federal prosecutors said that they couldn’t find an individual responsible for the tragedy, GM said it has laid off “wrongdoers”.

From the second quarter of 2012, GM began investigating the non-deployment of airbags in certain accidents involving its vehicles and learnt that the root cause was this faulty ignition switch.

GLINTON: GM will have to pay $900 million.

“We’re not done, and it remains possible that we will charge an individual, but the law doesn’t always let us to do what we wish we could”, Bharara told Reuters. The carmaker struck a deal with the U.S. Department of Justice, by which the DoJ agreed to defer the prosecution for three years, pending GM’s progress in an agreement wherein an independent monitor will evaluate its progress in safety practices.

In the settlement, the auto maker admitted that it has fraudulently marketed the cars as safe for more than 10 years.

The government and General Motors have reached a deal to resolve a criminal investigation into how the Detroit automaker concealed a deadly problem with small-car ignition switches.

Last year, GM established a fund to compensate victims. The announcement ends a USA government investigation into GM’s handling of the ignition-switch flaw. As of August 21, the GM compensation program has issued compensation for 124 deaths and 275 injuries.

The National Highway Traffic Safety Administration fined GM a record $35 million in May 2014 for failing to notify the government regulator about safety defects within a five-day period.

Barra, who was tapped to lead the company in December 2013 shortly before the ignition-switch problems mushroomed into a massive scandal, initiated a major overhaul of how the automaker develops, tests and monitors the safety of its vehicles.