DOJ starts criminal probe into GM over ignition switches

The Department of Justice is reportedly investigating General Motors (GM) over whether the company is criminally liable for its failure to properly disclose the problems with ignition switches that have been linked to the deaths of 13 people and which prompted the firm to recall 1.6M vehicles.

The federal probe adds to investigations in the House, and by the National Highway Traffic Safety Administration and GM itself.


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Comments (7)
  • Mike P.
    , contributor
    Comments (83) | Send Message
    My heart breaks for those involved in these automobile accidents, none of them were on purpose but, when you look at the photos from some of these accidents, even if the airbag did deploy, unfortunately, it would not have been enough to save some who died. As a former professional stock car driver and demolition derby champion, I can attest that some of the smallest of collisions can kill a person even with the most sophisticated roll cages and harnesses.


    I am also a pilot and fly small aircraft, as a pilot we take on the "Pilot In Command" responsibility and that includes the safety and wellbeing of the souls on board.


    Many of the GM Cars involved in these accidents that resulted in a fatality were totaled! That is an indicator that the "Driver In Command" may not have been using their best judgement, and I am sure that many of these incidents were due to reckless driving of at least one party to the accidents, and there has to be some responsibility excepted on the part of those who were killed in these unfortunate, unpredictable accidents.


    When someone is injured today in a car, the first thing the lawyers do is go after a manufacturer for something. Somehow if they manufactured a part differently, their loved one would still be alive.


    GM is one of the Nations largest employers and they support huge charity events and have come back to be a company that wants to make America proud. I am confident that the new CEO will get in front of this and do everything reasonably possible to compensate those who have a legitimate claim.


    I am sure many who lost a loved one who was driving reckless will try to blame GM for something but, isn't that the way scum operate anyway.


    Most car accidents happen from drivers becoming complacent, emboldened by luck of avoiding accident after accident, they drive just a little faster, not come to a complete stop at a stop sign, and take risks like talking on cell phones, texting and the like, we should all be more alert when behind the wheel, stay back a reasonable distance from other vehicles so that you have time to react to a potential situation.


    I do not think anything will come from a criminal investigation that CNBC is reporting. I am sure in two weeks you will hear that the AG's office has investigated the matter and finds no criminal acts have been identified.


    12 Mar 2014, 08:02 AM Reply Like
  • Copious28
    , contributor
    Comments (444) | Send Message
    On NPR yesterday, they mentioned the problem with the ignition was "caused by heavy keys turning the ignition to the off position". I'm pretty sure I would have concluded that wasn't their fault also.
    Only in America are manufacturers required to protect the consumer from their own stupidity.
    12 Mar 2014, 09:50 AM Reply Like
  • Challenger71
    , contributor
    Comments (6) | Send Message
    The tragedy of lives lost for whatever reason aside .... does anyone find it
    curiously convenient timing for the Obama administration to go after GM ... a mere 3 months after completing the sale of their remaining position in GM that is. And just who was the major shareholder in GM during the recall delay and what government was " overseeing the car company’s business dealings" over the last 4 1/2 years??
    12 Mar 2014, 10:02 AM Reply Like
  • Momintn
    , contributor
    Comments (6083) | Send Message
    A similar criminal investigation of Toyota's sudden acceleration recalls by the U.S. attorney in New York has been ongoing since Toyota's multiple recalls in 2009 and 2010. Nothing has resulted from it.
    12 Mar 2014, 10:27 AM Reply Like
  • Momintn
    , contributor
    Comments (6083) | Send Message
    Read BAC/ML's report on GM.
    Unfortunate tragedy, but impact on stock likely limited ...


    Reserves are robust, repairs likely more than covered
    GM reserves about $500 per vehicle wholesaled for recalls and similar costs for the
    lifetime of a vehicle, which in total equates to about $3bn annually. Total reserves
    at the end of 2013 stand at about $7.2bn. We’d estimate the cost of the repair at
    less than $50 per occurrence including labor, so on a base of 1.6mm vehicles the
    total cost of repairs would be about $80mm, well below existing reserves.


    Vehicles no longer sold in US so impact on volume is limited...


    Sentiment may take time to recover...


    BAC/ML still have a Buy rating on GM
    12 Mar 2014, 10:43 AM Reply Like
  • Elite Investor
    , contributor
    Comments (48) | Send Message
    Sure, "Buy Rating" while the big boys and Hedge Funds dump their shares!
    12 Mar 2014, 11:48 AM Reply Like
  • Momintn
    , contributor
    Comments (6083) | Send Message
    Actually look at the huge volume of PUTs. I do believe all the shorts are bombarding the news.
    Ex-dividend date is Friday for GM. Shorts pay the dividend to the real shareholders.
    S&P has GM as a 5 star stock and their last report Mar 8, 2014 shows that they raised their rating on the stock to Strong Buy on Mar 6.
    I'm not sure what is going to happen in the short term. But long term, it's a good dividend stock.
    12 Mar 2014, 11:52 AM Reply Like
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