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GM to Appoint Monitor, Pay $900M Fine Over Faulty Ignition Switches

GM agrees to pay $900 million fine 0:28

General Motors agreed Thursday to pay the federal government $900 million and appoint an independent monitor to oversee safety issues in a settlement with the Justice Department over the carmaker's faulty ignition switches.

No criminal charges were filed against current or former GM employees or executives.

Some victims and their family members said the government should have put company officials in jail.

"If a person kills someone because he decided to drive drunk, he will go to jail. Yet the GM employees who caused 124 deaths are able to hide behind a corporation because our laws are insufficient," said Laura Christian, whose 16-year-old daughter died in a July 2005 crash in Maryland.

GM admitted that the defective switches could move unexpectedly from the "run" position, cutting off power to a car's airbags and disabled the power steering and power brakes in some models of Chevrolets, Saturns, and Pontiacs.

The company has determined that the defective switches caused accidents that led to 124 deaths and 273 injuries.

GM to Pay $900 Million to Settle Criminal Case Over Ignition Switches 1:50

Related: Parents of GM Crash Victim Fund Vehicle Safety Watchlist

According to court documents filed Thursday, GM knew as early as 2005 that the switches were prone to moving to the "accessory" or "off" position while the cars were underway. And by the spring of 2012, GM personnel knew that the defect presented a safety hazard.

In 2006, the Justice Department found, a GM engineer directed that the defective switches no longer be used, but "nothing was done at this time to remedy the cars equipped with the defective switch that were already on the road." GM did not correct its earlier assurance that the switch posed no safety hazard, and the company did not issue a recall.

GM even rejected a simple improvement to the head of the ignition key "that would have significantly reduced unexpected shutoffs at a price of less than a dollar a car," the Justice Department said.

Instead of informing safety regulators, as federal law requires, the company stalled, fearing a blow to its business, and did not recall affected cars until February 2014.

Fed Gives $900M Penalty to GM for Ignition Problems 0:51

From the spring of 2012 to the spring of 2013, GM dealers were still selling used cars equipped with the faulty switches that would later become subject to a recall. The company assured unwitting customers that the cars mat all safety standards, court documents said.

In the meantime, GM personnel, in presentations to the National Highway Traffic Safety Administration, "touted the robustness of GM's internal recall process and give the misleading impression that GM worked promptly and efficiently to resolve known safety defects," according to a deferred prosecution agreement filed as part of the settlement.

GM also disclosed Thursday that it separately settled civil lawsuits brought by shareholders and accident victims over the ignition switch issue and other recalls.

The company said it would record a charge of $575 million in the third quarter of the year.