Reportedly Federal Prosecutors Reached Agreement With G.M. Over Defect in its Cars
On Wednesday, some people with knowledge of the matter said that the Federal prosecutors have reached an agreement with GM to resolve a criminal investigation which was initiated to probe how the automaker bypassed the law by hiding a fatal problem which existed in some of the ignition switches installed in its small-car.
According to the deal, General Motors is expected to pay approximately $900 million as fine for a deferred prosecution agreement on a wire fraud charge. Which means any other charges would be allowed to go, in case the carmaker complies with the guidance and further terms for three years. The agreement is not scheduled to be announced formally before Thursday.
Globally, General Motors recalled 2.6 million small older cars last year including Chevrolet Cobalt and Saturn Ion for replacing the switches which were faulty. Those could unpredictably slip out from their run position to the off spot or accessory. This problem in turn, could shut off the engine and disable the steering that's power-assisted along with the power brakes and also the safety air bags.
Due to this problem accidents were caused killing at least hundred and twenty four people and injuring 275 or some more says lawyers who are in charge of a fund that is set up by General Motors to compensate the victims.
The Detroit car company faces several lawsuits related to this and have kept aside $625 million as compensation.
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