UPDATE: Just like that, Toyota has released an official statement confirming its $1.2-billion dollar settlement with the US Attorney's Office. Our story has been updated to reflect this development and the automaker's official statement has been added below.

Toyota has reached a settlement over the criminal probe into its unintended acceleration problems, and the outcome is more expensive than first expected. The Japanese automaker has agreed to pay $1.2 billion to close the investigation among other settlement terms. The criminal inquiry focused on whether the company kept information from regulators and how it handled drivers' complaints about the problems, according to the sources.

Between 2009 and 2010, Toyota ended up recalling over 10 million vehicles worldwide over sudden acceleration fears. Fixes include modifying floor mats, gas pedals, and installing brake override software on affected models. In addition, Toyota made the latter standard on all of its new vehicles.

The first rumblings of a settlement broke last month when "people familiar with the matter" revealed a possible billion-dollar agreement. That rumor suggested that the deal would also include criminal deferred prosecution arrangement that would force Toyota to accept responsibility but let it avoid federal criminal convictions. This latest story doesn't mention this factor in the settlement.

"Toyota has cooperated with the US Attorney's office in this matter for more than four years. During that time, we have made fundamental changes to become a more responsive and customer-focused organization, and we are committed to continued improvements," said company spokesperson Steve Curtis in a statement to Bloomberg.

Toyota has already settled several other lawsuits related to the issue, including a $1.6-billion lawsuit from vehicle owners who claimed their cars dropped in value because of the issue. A $29-million settlement dealt with complaints from Attorneys General of 29 states.
Show full PR text

Toyota Enters Agreement with U.S. Attorney's Office Related to 2009-2010 Recalls

NEW YORK, NY, March 19, 2014 – Today, Toyota announced that it reached an agreement with the U.S. Attorney's Office for the Southern District of New York to resolve its investigation initiated in February 2010 into the communications and decision-making processes related to the company's 2009-2010 recalls to address potential "sticking" accelerator pedals and floor mat entrapment. As part of the agreement, Toyota will make a payment totaling $1.2 billion.

"At the time of these recalls, we took full responsibility for any concerns our actions may have caused customers, and we rededicated ourselves to earning their trust," said Christopher P. Reynolds, chief legal officer, Toyota Motor North America. "In the more than four years since these recalls, we have gone back to basics at Toyota to put our customers first."

Reynolds continued: "We have made fundamental changes across our global operations to become a more responsive company – listening better to our customers' needs and proactively taking action to serve them.

"Specifically, we have taken a number of steps that have enabled us to enhance quality control, respond more quickly to customer concerns, strengthen regional autonomy and speed decision-making. And, we're committed to continued improvement in everything we do to keep building trust in our company, our people and our products. Importantly, Toyota addressed the sticky pedal and floor mat entrapment issues with effective and durable solutions, and we stand behind the safety and quality of our vehicles.

"Entering this agreement, while difficult, is a major step toward putting this unfortunate chapter behind us. We remain extremely grateful to our customers who have continued to stand by Toyota. Moving forward, they can be confident that we continue to take our responsibilities to them seriously," Reynolds concluded.

Among the substantive actions the company has voluntarily taken since the recalls are:

Launching rapid-response teams to investigate customer concerns quickly

Committing $50 million in 2011 to launch Toyota's Collaborative Safety Research Center in Ann Arbor, Michigan to partner with more than 16 universities and institutions across North America on safety advances that will be shared to benefit the entire auto industry and society;

Expanding its network of field quality offices to improve customer responsiveness;

Enhancing regional autonomy, including naming the first American CEO of Toyota's North American Region as well as Chief Quality Officers for North America and other principal regions – all of whom have direct lines to President Akio Toyoda;

Improving its quality control process; and

Extending the new vehicle development cycle by four weeks to help ensure reliability and safety.

Under the agreement, the Government agrees to defer prosecution and then dismiss its case, as long as Toyota makes the required monetary payment, abides by the terms of the agreement and continues to cooperate with the Government. The agreement also provides for an independent monitor to review policies and procedures relating to Toyota's safety communications process, its process for internally sharing vehicle accident information and its process for preparing and sharing certain technical reports.

Toyota will record $1.2 billion in after-tax charges against earnings in the fiscal year ending March 31, 2014 for costs relating to the above agreement.

About Toyota

Toyota (NYSE:TM), the world's top automaker and creator of the Prius, is committed to building vehicles for the way people live through our Toyota, Lexus and Scion brands. Over the past 50 years, we've built more than 25 million cars and trucks in North America, where we operate 14 manufacturing plants (10 in the U.S.) and directly employ more than 40,000 people (more than 32,000 in the U.S.). Our 1,800 North American dealerships (1,500 in the U.S.) sold more than 2.5 million cars and trucks (more than 2.2 million in the U.S.) in 2013 – and about 80 percent of all Toyota vehicles sold over the past 20 years are still on the road today.

Toyota partners with philanthropic organizations across the country, with a focus on education, safety and the environment. As part of this commitment, we share the company's extensive know-how garnered from building great cars and trucks to help community organizations and other nonprofits expand their ability to do good. For more information about Toyota, visit www.toyotanewsroom.com.


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    • 1 Second Ago
  • 71 Comments
      pavsterrocks
      • 9 Months Ago
      Just imagine how much the lawyers just made. I bet there was some high-fiving going on with this news...
      DarylMc
      • 9 Months Ago
      The news of this shameful act by Toyota has spread around the world but the main lesson I take from it and will pass to my family is to think about putting the car into neutral or turning off the engine in this situation. I find it inconceivable that people could make a 911 call, find time to pray and not do that.
      george
      • 9 Months Ago
      Toyota got caught, admitted to it essentially with a plea deal, and are thus liars and murderous bastards.
      eagle6922
      • 9 Months Ago
      The fine was justified. It has been proven beyond a shadow of a doubt. If such a claim was not justified, Toyota would not have recalled over 5 MILLION vehicles world wide for this reason. Toyota may claim "A Persuit Of Perfection." Toyota is anything but. Toyota is a bleak auto. Toyota will do anything to have publications write good things. Toyota has been doing this since they started flooding the market under the Reagan administration. Toyota's were TIN at best. They couldn't pass National Safety requirements, but, yet, they were still allowed to croward US roads. They paid Non-Profits such as Consumer Reports, and others. To be sure Toyota has been able to wiggle/waggle all these years. This should have come to past decades ago. Thank goodness Toyota has finally been brought to it's cheating ways. Toyota and all other Jap/Crap should be band from the USA. No matter Toyota and other Jap/Crap's are built here. Majority of all profits revert back to Japan. BE PATRIOTIC ONCE AGAIN.......BUY AMERICAN!!!!!!!!
        Nick
        • 9 Months Ago
        @eagle6922
        "BUY AMERICAN" Like the CAMRY that was the most American built car for years in a row? http://www.theblaze.com/stories/2012/09/24/toyota-camry-recognized-as-most-american-made-car-on-the-road/
        jtav2002
        • 9 Months Ago
        @eagle6922
        They would not have recalled the cars? Tell me why then the recall on my Tacoma involved literally cutting my gas pedal in half so that it doesn't get caught on floor mats because people are too stupid to know they can't put them on top of each other. That screams user error, not vehicle defect. Besides, by being 'patriotic" and "buying American" do you mean buying foreign made GM vehicles, a company that willingly sold a vehicle to millions of people when they knew that before the car was ever released for it's first model year that it had a defect that has since went on to kill dozens of people?
      tiger
      • 9 Months Ago
      So, Toyota didn't have an unintended acceleration problem, NASA couldn't find a problem (even though there was one.) Toyota did not provide the entire code to NASA, hence the reason NASA could not determine the root cause (solder whiskering.) $1.2B PROVES there was a problem! Otherwise, why would they have to pay this? Further, why is everyone turning this into a GM blog?
        jtav2002
        • 9 Months Ago
        @tiger
        They're turning it into a GM blog because of all the people who crucified Toyota, wanted them to go out of business, and made it sound like they're the only company to have a recall and not handle it properly. Here we have GM saying they DO have a problem, and we know the problem existed in prototype vehicles before they were even on the market. While the backlash has been strong, they're not getting it NEARLY as worse as Toyota was for a problem that wasn't actually ever conclusively tied to a problem. Also, a settlement doesn't prove guilt nor does it mean they're admitting to guilt.
          jtav2002
          • 9 Months Ago
          @jtav2002
          I'm not a fanboy in the least. And I think you were trying to say "how ya doing' because hiya doing is kind of a retarded way to use the English language. FWIW, if you want to say I'm a Toyota fanboy you may be interested to know I have also owned a couple GM vehicles, as well.
      sfblog
      • 9 Months Ago
      Toyota was robbed
      normc32
      • 9 Months Ago
      I hope my GF's parents get some free oil changes out of this! I did try to explain to them that their decade old Toyotas are good and they cannot buy that car today, that there is a reason their 3 kids don't drive Toyotas.
      Jesus!
      • 9 Months Ago
      Why do people so quickly forget that there was a problem they did know about, and that was the accelerator pedals that would stick? Whether there was an electrical issue, we will never know for sure unless new covered up evidence is exposed, however, Toyota hid problems and became a tsb queen for years, so they are getting what they deserve. GM is next, they get what they deserve. How any of the people running these car companies can sleep at night knowing their customers are in danger is beyond me.
      owen brown
      • 9 Months Ago
      This is totally BS.I guess Toyota should have kept that 40 billion cash on hand a secret.
      i.own.your.ass
      • 9 Months Ago
      GM robbed Americans They are getting it back from Tokyo. ..
        kontroll
        • 9 Months Ago
        @i.own.your.ass
        ...and that's how it should be; Tokyo got the money from American idiots like you...so it's still American money
      WindsWilling
      • 9 Months Ago
      The public, Toyota, and others will be closely watching to see what becomes of GM's fiasco, criminally, and civilly, US AT office... as there is proof that GM knew they were making junk products and released them anyways, resulting in the loss of life. If the suits that knew about this, laughed, and just wanted their money don't get hard jail time in a real prison, there's a real problem here.
        eagle6922
        • 9 Months Ago
        @WindsWilling
        Go to Google search try and find anywhere GM knew. You have no clue. Just inuendo
          m_2012
          • 9 Months Ago
          @eagle6922
          They already publicly admitted they knew of this problem in 2001, possibly earlier. They also came up with a fix, but only if you lived long enough to complain. You don't engineer a fix for a problem that doesn't exist. In any case, the airbags should not shutoff just because the ignition was shutoff.
          jtav2002
          • 9 Months Ago
          @eagle6922
          Eagle, are you that much of a GM fanboy that you don't even believe it when GM themselves have said it. lol. If people think that people at Toyota should see jail time over a "problem" that came about after cars were on the road for years then people at GM should be charged with capital murder for choosing to sell a vehicle to people after finding a problem during prototype testing and choosing to sell it anyway.
        b.rn
        • 9 Months Ago
        @WindsWilling
        The media is dragging a lot around right now and it doesn't look good for GM. As the investigation goes on, we'll learn more. I'm not jumping to any conclusions yet.
      H.E. Pennypacker
      • 9 Months Ago
      didn't they find that human error was the cause of 'unintended acceleration?' it looks like toyota just paid the government to get off their back.
        carguy1701
        • 9 Months Ago
        @H.E. Pennypacker
        Yeah, they did. Just like it was when Audi got fingered for it in the 80s. Nothing good ever comes from witch-hunts like this.
        carguy1701
        • 9 Months Ago
        @H.E. Pennypacker
        Pretty much. It's awful.
        mapoftazifosho
        • 9 Months Ago
        @H.E. Pennypacker
        Nope...nothing to see here... http://www.nhtsa.gov/UA http://money.cnn.com/2011/02/08/autos/nhtsa_nasa_toyota_final_report/
        Jesus!
        • 9 Months Ago
        @H.E. Pennypacker
        Dont let some people fool you. They had complaints of sticking accelerator pedals for years and were slow to react. They knew the pedals were sticking. This is the Japanese we are talking about. Looking bad is not an option. Im sorry but I dont care who you are if you did no wrong you wouldnt settle.
        b.rn
        • 9 Months Ago
        @H.E. Pennypacker
        Pennypacker, Lots of moneygrubbers jumped on the "blame Toyota" bandwagon for their own driving failures. Lots of people! Don't let that detract from the fact that there really was a problem. Toyota admitted to some of it (sticky pedals). Not only did Toyota admit to it, but they were recalling cars in Europe while claiming the problem didn't exist in the US. That deception is one of the reasons the fine was as large as it was.
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