Senator wants DoJ to create GM victims' fund

US Senator Richard Blumenthal, a Democrat from Connecticut, is echoing the call of safety advocates in requesting that the Justice Department create a compensation fund for those killed or injured behind the wheel of General Motors vehicles with faulty ignition switches.

Blumenthal, pictured above, wrote to US Attorney General Eric Holder and called for the DoJ to "immediately intervene on behalf of those injured and killed and all who suffered damages as a result of faulty ignition switches," according to a new report from The Detroit News.

At least 12 deaths are attributed to the problem and there have been 31 accidents blamed on defective ignition switches that were inadvertently turned from the "run" position to the "accessory" or "off" position, a process that disables the steering, anti-lock brakes and airbags.

Blumenthal's comments follow those of Clarence Ditlow and Joan Claybrook, two safety advocates that have already called on GM to create a $1-billion trust fund to compensate crash victims. GM has so far claimed it's not liable for company actions that transpired prior to its bankruptcy, a defense brought about by the terms of its bailout agreement.

"There are certain cases where liabilities prior to bankruptcy – I don't know the right word – they're with the previous company," GM CEO Mary Barra said. This "Old GM" position has been one of the most contentious of this entire ordeal. Blumenthal even called it out in his letter to Holder, requesting that the DoJ "oppose any effort by GM to deny responsibility for consumer damages."

This isn't Blumenthal's first push against "New GM" immunity - The Detroit News reports that in 2009, the then-attorney general of Connecticut led seven other attorneys general against a measure that would protect the new company from the actions of its bankrupt forbearer.

GM remains in hot water with federal authorities, with the DoJ conducting a criminal investigation into the handling of the recall. The big question seems to be whether GM committed bankruptcy fraud by failing to disclose the faulty ignition switches. The National Highway Traffic Safety Administration is also looking into the ignitions, which GM has known about since 2001, while Barra is set to testify before a House of Representatives subcommittee next week.

Share This Photo X