Toyota Motor Corp. is recalling another 2.9 million cars around the world – though not in North America – that are equipped with the now-infamous and potentially deadly Takata air bag inflators, which have been linked to at least 11 deaths in the U.S. The recall affects 1.16 million vehicles sold in regions including Oceania and the Middle East, and about 750,000 vehicles in Japan, 650,000 in China and an additional 350,000 in Europe and covers the Auris, RAV4, Corolla Axio and other models, according to media reports. Takata air bags prompted the largest auto recall in U.S. history and the company has faced massive global recalls of its air bag inflators, which allegedly had a tendency to explode. The cheap but volatile ammonium nitrate that inflates the bags can misfire, especially in humid conditions, blasting chemicals and shrapnel at passengers and drivers.
The Japanese auto parts manufacturer in February pled guilty to one count of wire fraud in Michigan federal court as part of its plea deal with prosecutors over the company’s potentially deadly air bag inflators. Takata’s plea stems from the settlement reached with the U.S. Department of Justice (DOJ) in January that also requires the company to pay nearly $1 billion for falsifying testing data and reports about its inflators and to repay anyone injured by them. The settlement, which Takata announced Jan. 13, resolved the DOJ investigation into the company and its affiliates. That same day, the DOJ made a superseding filing that charged Takata with the one wire fraud count it agreed to plead guilty to. The scheme started sometime around 2000 and ran for at least 15 years, with Takata fraudulently persuading customers to buy air bag systems by giving them information that hid the accurate test results for the air bag inflators, prosecutors said. To further that plan, Takata made an interstate wire transfer of about $43,000 from Pennsylvania to Detroit, the DOJ said.
Under the terms of the proposed deal, Takata also agreed to pay a $25 million criminal fine and to establish a $125 million restitution fund for people who were injured or will be injured by a malfunctioning Takata air bag inflator. The company also agreed to create an $850 million fund to benefit automakers that received the falsified data and reports or that purchased the potentially dangerous inflators. Takata further agreed to improve its compliance program and to appoint an independent monitor who will report to the DOJ for three years about Takata’s compliance with legal and ethical obligations. A little more than a year ago, the National Highway Traffic Safety Administration (NHTSA) levied a $200 million fine on Takata – its largest ever – in a deal that saw the company admit that it failed to tell the agency about the defect despite knowing about it and withholding important information. At the time, NHTSA estimated that the exploding inflators had caused about 98 injuries. A sprawling multidistrict litigation involving injured victims and people whose car values have decreased is ongoing in Florida federal court. Takata is one of the Defendants.
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