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Justice Department Uses Wire Fraud to Pursue Product Safety Case

Jaclyn Jaeger | April 8, 2014

The Department of Justice is in hot pursuit of product safety cases, and if the record penalty it hit Toyota with last month is any indication, companies such as General Motors that have large safety issues with a product could be in for an unwelcome surprise.

The agency is taking a novel approach to its pursuit of product safety cases, including filing wire fraud charges and applying such laws very broadly and using other aggressive enforcement tactics.

In a first-of-its-kind criminal case in the automobile industry, for example, the Justice Department brought wire fraud charges against Toyota for repeatedly and intentionally misleading the public, regulators, and members of Congress about widespread incidents of unintended vehicle acceleration between 2009 and 2010 in order to protect its image.

Last month the agency hit Toyota with a record $1.2 billion criminal penalty—the largest of its kind in the auto industry—for intentionally concealing and... To get the full story, subscribe now.