GM ignition-defect recall delay investigated by Indiana

June 11, 2014

General Motors Co.’s delayed decision to recall almost 2.6 million cars for ignition-switch defects is being investigated by Indiana Attorney General Greg Zoeller, a spokeswoman for his office said.

GM has acknowledged 13 deaths tied to the defect, which can cut power to the vehicles’ steering and brakes and prevent airbags from deploying in a crash. Company executives were aware of the defect for at least a decade before the recall.

“We are investigating the matter and the investigation is ongoing,” Jaime Barb, a spokeswoman for Zoeller, said Wednesday in an e-mailed statement.

The Detroit-based company last week fired 15 people it said played a role in the recall delay immediately after it released the results of an internal investigation led by former Chicago U.S. Attorney Anton Valukas, now chairman of the law firm Jenner & Block LLC.

GM faces about 85 federal lawsuits filed by car owners claiming their vehicles lost value as a result of the recall and more claims over injuries and deaths attributed to crashes.

Federal judges two days ago transferred the economic-loss cases filed across the nation to U.S. District Judge Jesse Furman in New York. He will preside over pretrial litigation and disclosure of evidence.

James Cain, a spokesman for the company, declined Wednesday to comment immediately on the Indiana investigation.

In an April filing with the SEC, GM said it was the subject of “various inquiries, investigations, subpoenas and requests for information” from the office of U.S. Attorney Preet Bharara in New York, Congress, the National Highway Traffic Safety Administration, the U.S. Securities and Exchange Commission and one state’s attorney general.

The company said it was cooperating fully in those probes and that they might “result in the imposition of damages, fines or civil and criminal penalties.”

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