By on September 21, 2018

Four years after launching a massive, incredibly delayed recall aimed at preventing further deaths from its faulty ignition switches, General Motors freed itself from a criminal case launched in the scandal’s wake.

Earlier this week, federal prosecutors in New York wrote U.S. District Judge Alison Nathan, compelling him to dismiss the case. Nathan approved the request, lifting GM free of the caudron. The rationale for dismissing the two criminal charges — concealing evidence from federal officials and wire fraud — comes down to good behavior on GM’s part, something that certainly doesn’t describe its past actions.

Some 124 deaths and 275 injuries over a decade’s time resulted from GM’s 2002 decision to go cheap on its ignition switch design, causing the device to switch out of the run position while vehicles were underway. This led to a slew of crashes after vehicles lost engine power, as well as power braking and steering. Compounding the deadly situation, the faulty switches led to airbag and seat belt pretensioner non-deployment.

GM knew about this danger as early as 2004, prosecutors claim.

The decision to put the faulty switch into production saved GM less than one dollar per vehicle. As accident reports rolled in, GM dragged its feet in issuing a recall. The cost of fixing the issue would be immense. Finally, in February 2014, the automaker issued the first of several massive recalls as the feds stepped in to investigate, eventually laying charges.

With the recall underway, the following year GM forged a deferred prosecution agreement with the New York Attorney General, paying a $900 million fine and agreeing to three years of oversight by an independent monitor. The automaker sufficiently held up its end of the bargain, prosecutors decided. CEO Mary Barra fired over a dozen people involved in the scandal, then spent years attempting to show that the automaker had learned from its actions and forged a new corporate culture.

Given the grievous nature of its transgressions, the company can’t expect to scrub this black mark from its image overnight. The infamous Ford Pinto memo haunted GM’s Detroit rival for years. As well, there’s still civil lawsuits pending, though GM settled hundreds of them in 2017 at a cost of $575 million. The same year, GM settled with 49 states.

In total, the fines and lawsuits resulting from the scandal cost GM more than $2.6 billion, with the recall costing billions more. A hell of a price to save some money, though it’s the human toll that’s important here.

[Source: Reuters] [Image: General Motors]

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18 Comments on “With Criminal Case Dismissed, General Motors’ Ignition Switch Fiasco Nears An End...”

  • avatar

    All this because they wanted the ignition switch to have the “feel” of one in a Honda. They could have just engineered in the same switch used by Honda. Who made Honda’s switch? Denso?

  • avatar

    F*cking low-life criminals (literally).

    This is one of the major reasons America is so divided and hyper-polarized.

    Big Corporations (and smaller ones, for that matter), whether manufacturers, banks, pharma, agricultural, etc., literally can knowingly do things to intensely f*ck up people’s lives – including killing them – and they have no risk of criminal prosecution, pay a fine, and move on.

    See GM and Purdue Pharma (telling doctors that risk of opioid addiction from Oxycodone and Oxcontin – which the’ve made 15 billion in profits on since the 90s – was les than 1% when they had internal dos proving otherwise and at least 780,000 Americans have died from opioid overdoses).

    Contrast that with how German Gov’t is has treated VW/Audi dieselgate.

    Toxins at unsafe levels in drinking water, John Deere gets represent Farmers from repairing John Deere AG Machinery that they purchased – read about that today – Americans have no privacy rights as tech sector and gov’t have decimated 4th Amendment, etc.)



    • 0 avatar

      I have doubts that no one in the German government bureaucracies knew nothing was flaky with the emissions tests. Whether they were complicit or not, whether they took bribes or not, I find it hard to believe that no one knew nuthink.

    • 0 avatar

      Corporations and Government are relentlessly f*cking you over, chipping away at whatever rights, freedoms or leverage as a consumer or citizen that you have left:

      John Deere Just Swindled Farmers Out of Their Right to Repair

      “The fight for our right to repair the stuff we own has suffered a huge setback.

      As anyone who repairs electronics knows, keeping a device in working order often means fixing both its hardware and software. But a big California farmers’ lobbying group just blithely signed away farmers’ right to access or modify the source code of any farm equipment software. As an organization representing 2.5 million California agriculture jobs, the California Farm Bureau gave up the right to purchase repair parts without going through a dealer. Farmers can’t change engine settings, can’t retrofit old equipment with new features, and can’t modify their tractors to meet new environmental standards on their own. Worse, the lobbyists are calling it a victory.”

      Origins of an Epidemic: Purdue Pharma Knew Its Opioids Were Widely Abused

      “A confidential Justice Department report found the company was aware early on that OxyContin was being crushed and snorted for its powerful narcotic, but continued to promote it as less addictive.”

    • 0 avatar

      I agree that big companies get away with stuff, and NO ONE goes to jail. Ever.

      But, I don’t think GM was malicious. Certainly nothing like the 1960-63 Corvair, or the Pinto gas tank.

      I don’t think Toyota or Audi were malicious with their gas pedals.

      Wells Fargo…crooks. THEY should be boycotted.

      The 2008 financial crisis: lots of wrongdoing, no one went to jail.

  • avatar

    Not an excuse, but pre-bailout GM is a whole different animal than 2018 GM. I’m glad Barra fired those responsible, just too bad jail time hasn’t followed for them. Knowing about a deathtrap and choosing to do nothing is blatant manslaughter IMO.

    People talk about deregulation and scaling back federal oversight, but the fact remains that if you rely solely on the good will of billion dollar corporations to have consumers’ best interests and safety in mind, you’re just kidding yourself.

    • 0 avatar

      Another argument is that the buyers of these affected cars always had the choice to buy, or not to buy.

      People who buy GM deserve every thing they get, good, bad, or indifferent.

      (I started off in life as a GM fan. Oldsmobile was my passion before I knew better.)

  • avatar

    Agreed, that relying on corporations is naïve.

    But relying on the govt is almost as naïve, sadly.

    They are all ripping us off. REPRESENTATIVE Billy Tauzin. Helped expand Medicare to ‘give prescription drugs’ to seniors, but also helped write the law in such a way that the Federal Govt can’t challenge drug makers high prices.

    Good job Billy! Good money for big pharma! Tauzin makes $2 million a year heading a Pharma Lobbying group.

    Former FBI Director Louis Freeh just bought a $9 million house in California. Who know FBI pension were so generous? Maybe Freeh is a good stockpicker. He started a consulting firm for “Business Integrity and Compliance” to “help” companies get around annoying problems. He’s a fixer–and a well paid one.

    Trump, as odious and self-serving as he is, is right in saying “Drain the Swamp”. But he has been coopted. And where to start?

    • 0 avatar

      Unfortunately, the ONLY entity remotely capable of effective regulation IS the federal government. Really, who else is there? Russia? LOL Not that the federal government has gotten better since January 2017, but hey. Hope for the future?

      Apparently, by slashing budgets and eroding government watchdogs and oversight committees’ ability to effectively regulate and hold those few self-serving bureaucrats accountable is something that isn’t valued by our current administration, regardless of rhetoric.

      Draining the swamp? Ha! The swamp in Washington DC seems to be the only one getting federal protection right now.

  • avatar

    The lack of personal accountability here is tragic and inexcusable. There’s at least one individual who ought to be on death row, with several other strong candidates as well.

    • 0 avatar

      GM, as an entity, was on death row, was executed in 2008, and was brought back to life by the taxpayers.

      Bottom line, Shrub raised GM from the dead with his temporary 90-day bailout, but the next guy in office super-funded a GM that should have remained dead with the full faith and credit of the Treasury of the United States of America to the Yankee Doodle tune of $11Billion!!!

  • avatar

    What a disgusting company. Should be dead and buried. Killing people and covering it up. Shameful.


  • avatar
    SCE to AUX

    Wow, nobody seems to get it.

    The *big* difference here is intent. Sure, the victims are just as dead, but the law metes out penalties based upon intent. GM did not intend to kill its own customers.

    Anyone working in an engineering environment can tell you how hard it is to find root cause of a problem.

    Something like 30 people die every day in GM cars. It’s not like the company is getting reports on every accident. So over a 20-year period, close to 250k people have died in GM cars, yet the government ascribed about 124 deaths to this particular problem – about 0.05% of the total deaths. And many of these accidents included people who were weren’t buckled, were speeding, or were drinking.

    So you tell me how easy it is to determine a root cause for these deaths when 99.95% of the GM car deaths were for *other* causes, and even some of these had other circumstances included?

    GM did not “drag its feet” once it determined the problem. But they should have been more proactive in changing the ignition switch part number and forcing a recall.

    GM was perhaps incompetent, or negligent, but they did not have intent.

  • avatar

    “Good behavior”? As in, “You haven’t killed anyone lately so we’ll let you go this time”?

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