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Toyota to pay record $1.2 billion recall fine

Wednesday, March 19, 2014 - 01:42

March 19 - Toyota has agreed to a record $1.2 billion settlement with the U.S. Justice Department over criminal charges tied to the Japanese automaker's historic recall back in 2009. Conway G. Gittens reports.

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Toyota is hoping to finally smooth out the speed bump it hit on its way to becoming one of the world's largest auto companies. A settlement with the U.S. Justice Department ends a criminal probe over the way Toyota handled its biggest recall ever. The Japanese automaker will fork over $1.2 billion for misleading and concealing information tied to American recalls dating back to 2009 - when vehicles sped up without prompting from drivers. It comes with a rare admission of guilt, according to U.S. State Attorney General Eric Holder. SOUNDBITE: U.S. STATE ATTORNEY GENERAL ERIC HOLDER (ENGLISH) SAYING: "As part of the resolution of this case, Toyota will fully admit wrong doing. It will pay a financial penalty of $1.2 billion dollars, and going forward, the company will submit to rigorous review by an independent monitor that will examine and assess the manner in which Toyota regularly reports safety issues to the public and its regulator. The $1.2 billion dollar payment represents the largest criminal penalty imposed on a car company in the history of the United States." Toyota says it will take a $1.2 billion after tax charge against earnings this fiscal year. And the agreement is "a major step toward putting this unfortunate chapter behind us." But this does not totally put to rest potential hits to Toyota's wallet. There's still hundreds of lawsuits tied to the unintended acceleration responsible for the recall of millions of Toyota-made vehicles. Late last year the automaker agreed to pay out $1.6 billion to Toyota owners who claimed the value of their cars dropped because of those safety issues.

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Toyota to pay record $1.2 billion recall fine

Wednesday, March 19, 2014 - 01:42