Honda Underreporting Injury Claims:Fined Record $70 Million

Honda Motor Co. (7267) agreed to pay a record $70 million in fines and submit to stricter oversight for failing to tell the U.S. government about warranty claims and more than 1,700 injuries and deaths linked to potential defects in its cars.
Automakers are required to report such information under a 14-year-old U.S. law, and Honda’s violations may have hampered the National Highway Traffic Safety Administration’s ability to quickly identify vehicle flaws.
“Honda and all of the automakers have a safety responsibility they must live up to -- no excuses,” U.S. Transportation Secretary Anthony Foxx said in a statement today. “These fines reflect the tough stance we will take against those who violate the law.”
Honda’s violations came to light late last year as investigations into a global crisis over defective air bags cast doubt on the diligence of some automakers to tell the government about all potential product defects. In a synopsis of an internal review filed with NHTSA in November, the Tokyo-based automaker blamed its underreporting on “inadvertent data entry or computer programming errors” that spanned 11 years.
The civil penalties today include two separate fines of $35 million, each the maximum allowable under U.S. law. One covers Honda’s failure to report 1,729 death and injury claims to NHTSA from 2003 to 2014. The second fine covers lapses on completely reporting warranty claims and repairs offered under “customer satisfaction campaigns.”