Toyota to pay $1.2 billion federal penalty, criminal charges filed

Eric Holder blasts Toyota's "shameful" deception on safety issues

WASHINGTON - The U.S. has reached a $1.2 billion settlement with Toyota Motor Corp. and filed a criminal charge alleging the Japanese automaker defrauded consumers by issuing misleading statements about safety issues in Toyota and Lexus vehicles.

Under the agreement, announced Wednesday by U.S. Attorney General Eric Holder, the company will admit that it misled U.S. consumers by making deceptive statements about two safety issues affecting its vehicles. As a result, Toyota will pay a $1.2 billion financial penalty under a "deferred prosecution agreement."

"Put simply, Toyota's conduct was shameful," Holder told reporters at a press conference Wednesday.

It is the largest penalty of its kind imposed on an automotive company by the U.S., Holder said.

The FBI in New York led the investigation into Toyota, beginning in 2010.

"Toyota put sales over safety and profit over principle," said FBI Assistant Director George Venizelos, in a statement. "The disregard Toyota had for the safety of the public was outrageous. Not only did Toyota fail to recall cars with problem parts, they continued to manufacture new cars with the same parts they knew were deadly."

A Toyota spokesperson told CBS News early Wednesday that, "Toyota has cooperated with the U.S. Attorney's office in this matter for more than four years. During that time, we have made fundamental changes to become a more responsive and customer-focused organization, and we are committed to continued improvements."

The case has hinged on whether Toyota was forthright in reporting quality problems related to unintended acceleration troubles.

In August of 2009 a family of four was killed in San Diego, in an accident involving an out-of-control Lexus. They called 911 from the speeding vehicle. ""We're in a Lexus . . . and we're going north on 125 and our accelerator is stuck . . . there's no brakes . . . we're approaching the intersection . . . Hold on . . . hold on and pray . . . pray." The call ended with the sound of a crash that killed everyone on board.

The family's Lexus reportedly had floor mats that were improperly installed, trapping the accelerator at full throttle.

Starting that same year, Toyota issued massive recalls, mostly in the U.S., totaling more than 10 million vehicles for various problems including faulty brakes, gas pedals and floor mats.

From 2010 through 2012, Toyota Motor Corp. paid fines totaling more than $66 million for delays in reporting unintended acceleration problems.

"Today's announcement could have been prevented if Toyota had done the right thing, told the truth, and fully disclosed the rampant safety problems," Venizelos said. "Instead, they denied and doubled-down. More than speeding cars or a major fine, the ultimate tragedy has been the unwitting consumers who died behind the wheel of Toyota vehicles."

The National Highway Traffic Safety Administration never found defects in electronics or software in Toyota cars, which had been targeted as a possible cause by many, including some experts.

f

We and our partners use cookies to understand how you use our site, improve your experience and serve you personalized content and advertising. Read about how we use cookies in our cookie policy and how you can control them by clicking Manage Settings. By continuing to use this site, you accept these cookies.