GM CEO: ‘People died in our cars’

Then, in 2012, GM discovered that these damaged and faulty ignition switches could cut off the power to the front seat airbags.

Democratic Senators Richard Blumenthal of Connecticut and Edward Markey of Massachusetts called the agreement “extremely disappointing”, and said victims deserved “individual criminal accountability, as well as a larger monetary penalty”.

GM’s US$900 million payment will be treated as a penalty, including for tax purposes.

The ignition switch of a 2005 Chevrolet Cobalt.

Just as GM bought it’s way out of federal wire fraud charges and charges against its employees, the automaker is also getting off with a slap on the wrist with the 5 million settlement.

U.S. Attorney for the Southern District of New York Preet Bharara said, “GM failed to disclose a deadly safety defect to the public and its regulator. That is something that we understand and we take forward and will have with us every day”. Many believe the deal brought down heavy criticism on the Justice Department for not bringing charges against individual employees.

GM chief executive Mary Barra apologized once again for the automaker’s actions and insisted that the company has turned the “crisis into a catalyst for meaningful change”.

Instead of informing safety regulators, as federal law requires, the company stalled, fearing a blow to its business, and did not recall affected cars until February 2014.

Reuters reported that GM admitted to failing to disclose a potentially lethal defect and misleading consumers about the safety of vehicles. “The law doesn’t always do what we wish it could”. He added that GM was given credit for cooperating with the investigation, including sharing the results of its in-house probe. GM hired former federal prosecutor Anton Valukas to investigate the matter, and he found no wrongdoing on the part of top executives. “People know we are honest”, she said. Court papers pertaining to it were signed Wednesday. GM agrees to report safety problems faster and consents to government oversight of its safety operations. Rather than coming forward and publicly saying that, the company continued to hide these facts. The scandal worked totally against the company and damaged its reputation.

The auto manufacturer has entered into a three-year deferred prosecution agreement, during which an independent monitor will oversee its practices and ability to fix the defects effectively.

August 2015: Attorney Kenneth Feinberg, who is administering GM’s compensation fund, says the ignition switches were responsible for 124 deaths and 275 injuries. Families of those who died will get at least $1 million. He says the lawsuits include 45 deaths.

Cases with previously agreed-upon trial dates are also still slated to go ahead.

The company faces more than 200 civil lawsuits over the ignition switch and other recalls from 2014.