DOJ May Charge GM with Wire Fraud for Delaying Defective Ignition Switch Recall

According to a Wall Street Journal report, the U.S. Department of Justice is considering charging GM with criminal wire fraud in connection with the automaker’s delay in issuing a recall for faulty ignition switches that have been linked to more than 100 deaths.

The WSJ report said that the DOJ is hoping to settle with GM by the end of this summer or early fall. It said that prosecutors are also exploring any criminal wrongdoing as well. GM has said that it is cooperating fully with the DOJ in its investigation and that speculation about pending criminal charges “does no one any good.”

Since early 2014, GM has recalled millions of vehicles found to have faulty ignition switches, costing the company billions of dollars. In addition, the company has restructured its legal department after allegations of a cover-up of the issue within the department.

Wire fraud statutes had not been used in cases involving car defects until Manhattan U.S. Attorney Preet Bharara charged Toyota in 2010 with wire fraud for allegedly making misleading statements to consumers about the safety of its cars after reports of unintended acceleration. The case was settled in March 2014, with Toyota agreeing to pay a $1.2 billion fine and entering into a three-year deferred prosecution agreement.

The Cogdell Law Firm is a full service criminal litigation and appellate law firm. We provide client-focused representation at all stages of the process, whether our clients are seeking to avoid charges, have been charged, or are seeking reversal of a conviction on appeal. When results matter most, contact Dan Cogdell at (713) 426-2244 or info@cogdell-law.com.

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