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Toyota pays maximum NHTSA fine

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Toyota pays maximum NHTSA fine

David Shepardson / The Detroit News

Washington -- Toyota Motor Corp. this morning paid the largest auto safety fine in history -- $16.375 million -- for delaying the recall of 2.3 million vehicles by at least four months, the Transportation Department said.

In an agreement with the National Highway Transportation Safety Administration, the Japanese automaker agreed to pay the fine -- the maximum allowable under law -- but denied wrongdoing. In April, Toyota agreed to make the payment by electronic funds transfer to the U.S. Treasury within 30 days. Toyota spokeswoman Cindy Knight confirmed the payment but didn't offer any additional comment.

The deal says the payment is "without NHTSA making any formal findings with respect to Toyota's violations."

"We agreed to this settlement in order to avoid a protracted dispute and possible litigation," the company said last month. "We regret that NHTSA tentatively concluded that they should seek a civil penalty."

Toyota said it "made a good faith effort to investigate this condition and develop an appropriate counter-measure. We have acknowledged that we could have done a better job of sharing relevant information within our global operations and outside the company."

The fine is the largest civil penalty ever assessed against an auto manufacturer by NHTSA and stems from the automaker's sticky pedal recall issued on Jan. 21.

Five days later, under pressure from NHTSA, Toyota stopped sale of 60 percent of its vehicles in the United States because it didn't have a fix.

Auto manufacturers are legally obligated to notify NHTSA within five business days if they determine a safety defect exists. NHTSA said it learned through documents obtained from Toyota that the company knew of the sticky pedal defect since at least Sept. 29, 2009, the agency said.

That day, Toyota issued repair procedures to its distributors in 31 European countries and Canada to address complaints of sticky accelerator pedals, sudden increases in engine revolutions and sudden vehicle acceleration. The documents also show that Toyota was aware that consumers in the United States were experiencing the same problems, the agency said.

"By failing to report known safety problems as it is required to do under the law, Toyota put consumers at risk," Transportation Secretary Ray LaHood said last month.

If there wasn't a cap on fines, NHTSA said it could have assessed a $6,000 per vehicle penalty -- or $13.8 billion.

NHTSA officials are continuing to review Toyota's statements and more than 240,000 pages of Toyota documents to determine whether the company has complied with all its legal obligations.

NHTSA could impose several additional fines over Toyota's handling of its recalls.

Last week, NHTSA opened a new investigation into whether Toyota delayed a 2005 recall of pickup trucks -- despite recalling similar models in Japan in 2004.

The investigation is looking at the 2005 recall of 977,000 Toyota 4Runner and T100 trucks in the United States.

Earlier this month, NHTSA was alerted to a number of complaints filed with Toyota by U.S. consumers prior to the 2004 recall in Japan of the Hilux, which the automaker says was "substantially similar" to the vehicles sold in the United States under other names. While Toyota in 2004 claimed it had no "similar" complaints in the United States, records obtained by NHTSA show Toyota had received at least 41 complaints in the United States before the Japanese recall.

From The Detroit News: http://www.detnews.com/article/20100518/AUTO01/5180405/1148/auto01/Toyota-pays-maximum-NHTSA-fine#ixzz0oJJZbamd

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