But GM failed to issue a recall for 20 more months, the Justice Department said.
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Staff at the company were aware for over a decade of issues with ignition switches used in a number of vehicles before any recalls were made.
Under a deal with federal prosecutors expected to be announced Thursday, the automaker will pay a fine of $900 million to resolve a criminal investigation. The government agreed not to seek a conviction in exchange for the fine and the appointment of an independent monitor at the company.
Special Inspector General Christy Goldsmith Romero said, “GM could have significantly reduced the risk of this deadly defect by improving the key design for less than one dollar per vehicle but GM chose not to because of the cost”.
GM recalled roughly 2.6 million older Chevrolet Cobalts and other small cars in 2014 equipped with a defective switch that could slip out of the run position, disabling safety features including air bags, power steering and power brakes.
GM agreed to a statement of facts that described in scathing terms its deceptive and dismissive approach to the defect.
GM CEO Mary Barra, who took control of the company as the recalls were becoming public, told lawmakers during a series of contentious hearings on Capitol Hill that she was “deeply sorry” for the failure to swiftly recall vehicles with a risky ignition switch flaw. The company has agreed to pay compensation for 124 deaths and 275 injuries. It praises GM for “terminating wrongdoers” and says its “agents and employees” concealed a potentially deadly safety defect. Moreover, the reputation of the company was marred as well, as it became the subject of a plethora of lawsuits and protests at the hands of consumers and pressure groups.
She once again apologized to the families impacted by the defect. The prosecutor said it was unlawful for the auto industry to hide defects from regulators but the chain of responsibility is extremely diffuse and no single person could he held accountable for the entire situation.
GM also announced it would spend $575m (£367.7m) to settle the majority of civil lawsuits filed over the scandal. It was not immediately clear whether GM would take additional charges to account for a settlement of the criminal probe.
Just as GM bought it’s way out of federal wire fraud charges and charges against its employees, the automaker is also getting off with a slap on the wrist with the $575 million settlement.
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A lead lawyer for civil plaintiffs, Robert Hilliard, said the agreement over injury and death cases was finalized late on Wednesday.
