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Brett Emison
Brett Emison
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“Toyota’s Conduct Was Shameful”

3 comments

Handcuffs

 

Ok… the image of the handcuffs is a bit misleading.  Nobody went to jail.  As Robert Reich said, “I’ll believe corporations are people when Texas executes one.”

But Toyota did agree to pay the largest criminal penalty ever assessed on an auto manufacturer:  $1.2 billion.  The criminal fine will resolve the Justice Department’s 4-year criminal probe into whether Toyota misled investigators and public about the sudden acceleration defect that resulted in the recall of more than 10 million vehicles and may have killed more than 100 people.

“Toyota’s conduct was shameful,” said US Attorney General Eric Holder, adding that the Japanese manufacturer “intentionally concealed information and misled the public.”

“Toyota put sales over safety and profit over principle,” George Venizelos, the F.B.I. assistant director in charge of the New York field office, said in a statement on Wednesday.  “The disregard Toyota had for the safety of the public is outrageous.”

- via NY Times

The criminal settlement also included an admission of wrongdoing from Toyota.  In addition to the admission of wrongdoing, Toyota has agreed to cooperate with an independent monitor to oversee Toyota’s public statements and regulatory filings with respect to safety issues.  In turn the government will file criminal charges, but dismiss the charges after three years if Toyota keeps up its end of the bargain and resolves its safety issues.

In a statement, Christopher P. Reynolds, Toyota’s chief legal officer in North America, said the company took “full responsibility” for its actions.  “Entering this agreement, while difficult, is a major step toward putting this unfortunate chapter behind us,” Mr. Reynolds said.

- Toyota Reaches $1.2 Billion Settlement in Criminal Inquiry at NYT

Deal May Affect GM’s Recall Issues

General Motors is facing similar criminal scrutiny from its handling of an ignition switch recall that could shut down electrical components, including the vehicle’s air bag.  Many have said the Toyota agreement may provide a blueprint for the Justice Department’s investigation of GM.

In fact, one speaker at the press conference announcing the Toyota deal slipped and said “General Motors” instead of Toyota.

GM – like Toyota – initially denied allegations of the defect, but later admitted it had known about the problem for a decade without telling the safety agency, NHTSA.

Is Toyota The Criminal?

So we have a known safety hazard that was ignored.  We have a known safety hazard linked to potentially more than 100 deaths.  We have an admission of guild.

And no one goes to jail.

Yes, Toyota’s conduct was reprehensible.  Yes, Toyota’s conduct was illegal and criminal.

But Toyota doesn’t does not act of its “own” volition.  It has no brain.  It has no mind.  It has no soul.  It is nothing more than a legal fiction.  It acts through people.

And no one goes to jail.

Can we get a grip?  The only sentient beings in a corporation are the people who run them or work for them.  When it comes to criminality, they’re the ones who should be punished.

- Robert Reich

While we can hope Toyota’s fine is enough to get the attention of other automakers, we have to remember we’re dealing with giant corporations.  Toyota’s market capitalization today is nearly $172.5 billion.  Ford’s market cap is more than $60.5 billion.  GM’s market cap is more than $55.5 billion.

Toyota’s record fine represents less than 0.7% of the company’s value.  To put that in perspective, for a family earning $50,000, an equivalent fine would be just $347.82.

It’s a drop in the bucket.  While the DOJ’s actions are a nice step, do they go far enough?  Will these companies really stop putting profits over safety?  Maybe they would if someone actually went to jail.

© Copyright 2014 Brett A. Emison

Follow @BrettEmison on Twitter.

3 Comments

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  1. Charlene Blake says:
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    With regard to Toyota SUA, sudden unintended acceleration, there remain some very tough questions for Toyota, the NHTSA, and the DOJ to answer:
    1) Why haven’t Professor David Gilbert’s and embedded systems expert Michael Barr’s findings of an electronic fault without adequate fail-safe in the Toyota ETCS been fully examined?
    2) Why hasn’t Dr. Antony Anderson’s logical debunking of NHTSA’s 1989 driver error determination of SUA been considered?
    3) Why haven’t the Toyota internal documents of Toyota Whistleblower, Betsy Benjaminson, been acknowledged and accepted as evidence in Toyota’s criminal investigation? Toyota engineers admit concern about the “ghost in the machine” and the unpredictability of the performance of the ETCS.
    4) Why are the Toyota owners both the field-testers and fail-safe applicators for their own vehicles’ questionably-designed ETCS?
    5) Most importantly, how many more deaths have to occur before someone takes charge of permanently eliminating the unacceptable risks to both the Toyota drivers and those they encounter on the roads and highways?