Toyota President Akio Toyoda during a press conference in Tokyo on Feb. 17, 2010 (Junko Kimura/Getty Images)
Associated Press | Facing tough questions in Congress, Toyota Motor Corp. said Monday that federal prosecutors have launched a criminal investigation into the company’s safety problems and the Securities and Exchange Commission was probing what the automaker told investors.
Lawmakers pledged to ask executives about internal documents showing that Toyota visited with regulators who “laughed and rolled their eyes in disbelief” over safety claims.
The twin developments created new challenges for Toyota officials scheduled to testify at hearings Tuesday and Wednesday amid concerns that the company and federal regulators failed to take safety problems seriously. Congressional investigators are reviewing the Japanese automaker’s recall of 8.5 million vehicles since fall to deal with safety problems involving gas pedals, floor mats and brakes.
In a new filing with the SEC, Toyota said it received the grand jury request from the Southern District of New York on Feb. 8 and got the SEC requests Friday.
The investigations raised the possibility of hefty fines for the automaker or possible indictments against executives in the United States or even in Japan. The latter would require executives to be extradited to the U.S. to face trial.
“As a general matter, prosecutors will look at whether individuals may have violated the law and bring charges against them as individuals, rather than seeking to build a case against the corporation itself,” said Robert Mintz, a former federal prosecutor in New Jersey who leads the government investigations and white collar criminal defense practice group with McCarter & English in Newark, New Jersey.
It wasn’t immediately clear what U.S. laws Toyota might have broken. A subpoena would specify why prosecutors sought company documents, but Toyota would not comment beyond its disclosure with the SEC. A spokeswoman with the U.S. Attorney’s Office for the Southern District of New York declined to comment, saying it does not confirm or deny its investigations as a matter of policy.
