Toyota Charged with Wire Fraud

Toyota Motor Corporation was charged with federal wire fraud on Wednesday after it admitted to intentionally deceiving regulators about deadly safety defects.  The Japanese based company has agreed to pay a $1.2 billion fine in what is the largest penalty ever imposed on an automaker.  The landmark settlement officially ends a four year probe by the Manhattan United States Attorney’s Office into safety issues at General Motors.

According to the agreement, Toyota executives responded to initial complaints of “sticking gas pedals” and “unwanted acceleration” by deceiving the public and looking for ways to limit damage to its global brand.  The strategy continued despite a 2009 incident in which a family of four was killed in San Diego when their Lexus suddenly accelerated to speeds of 100 miles-per-hour and crashed.

Prosecutors blasted Toyota and accused the company of executing a “campaign of disinformation” to fool regulators and consumers about the depth of the safety problems.  United States Attorney Preet Bharara said that Toyota “cared more about savings than safety, because it cared more about its own brand and bottom line than the truth,”

The National Highway Traffic Safety Administration has also come under scrutiny for not pushing Toyota harder in the early stages of their investigation into motorist complains.

The one count of wire fraud officially charged to Toyota can be dismissed after three years if the automaker abides by the settlement terms.