Report: Takata In Talks To Resolve Criminal Allegations From Deadly Airbag Debacle

Image courtesy of Samuel M. Livingston

Nearly two years after Takata announced it was subject to a federal criminal investigation related to its handling of shrapnel-shooting airbags, the Japanese auto parts maker is reportedly working to make a deal with the Justice Department to resolve allegations of criminal wrongdoing. 

The Takata airbags have so far been linked to more than a dozen deaths. According to the Wall Street Journal, the company has had preliminary discussions with the DOJ that could close the books on the ongoing criminal investigation into the Japanese auto parts maker’s culpability.

The Justice Department, which is awaiting a proposal from Takata, is reportedly weighing its options, determining whether or not to charge the parts maker with criminal wire fraud after finding it likely made misleading statements and concealed information about the airbags.

Any deal between the parts maker and prosecutors will likely include a stiff financial penalty, the sources say. That penalty would be on top of the $70 million fine levied against the company last November by the National Highway Traffic Safety Administration.

All discussions between the airbag maker and federal prosecutors are preliminary, and could fall apart before a deal is reached, the people cautioned.

Takata previously admitted that it failed to follow federal law by alerting regulators within five days of determining the airbags posed a safety defect.

Subsequent reports and investigations found evidence that the company purposely concealed tests and other documents that involved exploding airbags.

In addition to exploring criminal charges against the company, the WSJ reports the Justice Department’s fraud division and U.S. Attorney’s office in Detroit are considering pursuing criminal charges against individual employees.

Takata is just the latest auto industry biggie to face criminal charges stemming from a massive recall or defect.

Both Toyota and GM faced wire-fraud charges in cases related to unintended acceleration and defective ignition switch issues, respectively.

The automakers each entered into deferred prosecution agreements that involve the government dismissing the charges in the future as long as the carmakers adhere to settlements requirements.

As part of the agreements, GM was ordered to pay a $900 million fine, while Toyota was ordered to pay $1.2 billion.

Earlier this year, sources revealed that the Justice Department turned up evidence of criminal wrongdoing at Volkswagen related to the automaker’s emissions scandal. It’s unclear if charges will be filed or whether another deferred prosecution agreement will be sought.

Takata in Talks to Resolve Allegations of Criminal Wrongdoing Over Faulty Air Bags [The Wall Street Journal]