Toyota will have to pay $1.2 billion for hiding facts and misleading the public during the recall involving unintended acceleration. NBC 7’s Nicole Gomez reports on this unprecedented settlement in the auto industry.
The Justice Department has reached a $1 billion agreement with Toyota to resolve concerns over how the company responded to consumer complaints about rapid acceleration in select models five years ago, federal officials confirmed to NBC News Tuesday.
U.S. Attorney General Eric Holder announced Wednesday that as part of the settlement, Toyota will fully admit wrongdoing in the criminal investigation that followed the fatal high-speed crash of a San Diego-area CHP officer and his family in August 2009.
Four people died in when a Lexus sedan driven by CHP Officer Mark Saylor, 45, lost control on the highway, crashed near Mission Gorge Road in Santee and burst into flames.
The victims included the officer’s wife Cleofe Lastrella Saylor, 45, his brother-in-law Chris Lastrella, 38, and his daughter Mahala, 13.
Two months later, federal investigators found a stuck accelerator played a significant role in the crash.
The U.S. launched an investigation into how Toyota disclosed complaints about problems of sudden acceleration associated with its Toyota and Lexus models.
"Today, we can say for certain that Toyota intentionally concealed information and misled the public about the safety issues behind these recalls," Holder said.
U.S. Attorney for the Southern District of New York Preet Bharara said the issues began as far back as 2007 but the company resisted all vehicle recalls and negotiated with the NTHSA a limited recall of floormats.
“At the time, Toyota was positively jubilant about that result, noting in an internal email that it had saved ‘$100 million plus in unnecessary costs,’” Bahara said. “Two years later tragedy struck.”
Following the deaths of Officer Saylor and his family, Bahara said Toyota made the decision to mislead the public to protect its brand.
"Rather than come clean, the company covered up and misled again and again and again," Bahara said.
In the months after, Toyota then lied about fixing the problem, according to the U.S. prosecutors.
In December 2010, Toyota reached a $10 million settlement with the family. Toyota did not admit or deny liability in the settlement.
In a statement early Wednesday, Toyota said it has "cooperated with the U.S. Attorney's office in this matter for more than four years" and had "made fundamental changes to become a more responsive and customer-focused organization, and we are committed to continued improvements."
Starting in 2009, 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.
The National Highway Traffic Safety Administration never found defects in electronics or software in Toyota cars, which had been targeted as a possible cause.