Takata pleads guilty to knowingly selling faulty airbags

Melba UnderwoodJan 17, 2017

Three former high-level Takata executives have been indicted on charges of conspiracy and wire fraud.

The world's biggest carmaker, Toyota, is recalling another 5.8 million cars worldwide over potentially faulty air bags made by supplier Takata.

The three Takata executives - Shinichi Tanaka, 59; Hideo Nakajima, 65; and Tsuneo Chikaraishi, 61, all Japanese citizens - were each charged in an indictment filed on December 7, 2016, in the Eastern District of MI with one count of conspiracy to commit wire fraud and five counts of wire fraud for their alleged conduct in connection with the above-described fraud scheme.

The DoJ contends that as far back as 2000, the three executives fabricated airbag safety test information and concealed known defects from automakers. The firm, which also has assembly plants in Brazil and Uruguay, also pleaded guilty to a single criminal charge, the company and the US Department of Justice said.

The company will admit to wire fraud for misleading regulators, consumers and vehicle manufacturers about the safety of its air bags, which would explode and spray drivers and passengers with shrapnel, according to court papers.

The individuals, who left the company in 2015, were charged with fraud for hiding the flaws in the airbags, so far blamed for 16 deaths and 100 injuries worldwide, according to documents filed in federal court in MI and made public on Friday.

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In January, Tech Times shed light on the fact that almost 772,000 Honda Acura cars were being recalled by the carmaker due to Takata air bags potentially exploding, shooting metal shrapnel in the process.

Prior to today's indictments, Takata has agreed to pay up to $200 million in civil penalties in a deal with the NHTSA. Three longtime Takata executives, all Japanese citizens, were indicted by a federal grand jury.

"If they choose instead to engage in fraud, we will hold accountable the individuals business entities who are responsible", said Barbara McQuade, a U.S. attorney of Michigan's Eastern District, in an announcement.

Under the terms of the agreement with the US Justice Department, which has yet to be approved by a judge, Takata will pay a $25 million fine, establish a $125 million fund to compensate victims and pay $850 million in restitution to affected automakers. US officials have also ordered that an independent monitor look after the company to make sure it complies with regulations.

Globally, Honda has recalled 51 million Takata air bag inflators, and a smaller number of Honda brand and luxury Acura brand vehicles, because some of the models have been involved in more than one recall for the inflators.

McQuade declined to put a percentage on the chances of getting them back to the US, but said the chances are "pretty good". They do not now have a date to appear in court. Rosekind announced that Takata will expand its recall to at least another 35 million rupture-prone air-bag inflators that US regulators have deemed a safety risk.

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