Consumer Fraud

NHTSA will hit Toyota with largest possible civil penalty

The U.S. federal government will levy a $16.375 million civil penalty, the maximum allowable under law, against Toyota for failing to promptly inform regulators about sticking accelerator pedals in some 2.3 million vehicles. The fine will be the largest civil penalty the National Highway Traffic Safety Administration has ever sought against an auto manufacturer.

NHTSA charges Toyota with failing to notify the government about the dangerous “sticky pedal” defect for at least four months, “despite knowing of the potential risk to consumers.” U.S. law requires automakers to notify regulators of defects within five business days after being uncovered.

Internal Toyota documents obtained by NHTSA revealed that the company knew of the defect since September 29, 2009. On that day, Toyota sent repair procedures to distributors in 31 European countries and Canada to address complaints of sticking gas pedals, arbitrary engine revving, and sudden acceleration. Despite knowing that customers in the U.S. also experienced the same problem, Toyota waited months before informing NHTSA.

“We now have proof that Toyota failed to live up to its legal obligations,” said Secretary LaHood. “Worse yet, they knowingly hid a dangerous defect for months from U.S. officials and did not take action to protect millions of drivers and their families. For those reasons, we are seeking the maximum penalty possible under current laws.”

NHTSA Administrator David Strickland said that the agency continues to investigate how Toyota handled acceleration-related recalls involving nearly 9 million cars and would hold the company accountable for any further violations that may turn up.

Toyota has two weeks to accept NHTSA’s penalty or dispute it. a Transportation spokeswoman told the New York Times Monday that the company had not yet received NHTSA’s letter announcing the fine.