Global Biz
Toyota faces federal, congressional probe
(Agencies)
Updated: 2010-02-23 14:16
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WASHINGTON: Federal prosecutors have launched a criminal investigation into Toyota Motor Corp.'s safety problems and the Securities and Exchange Commission was probing what the automaker told investors, the company disclosed Monday. Newly released internal documents showed that Toyota officials visited with US regulators years ago who "laughed and rolled their eyes in disbelief" over safety claims.
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 The open letter that was sent to Toyota owners is displayed in the visitor center at the Toyota Motor Manufacturing, Kentucky plant in Georgetown, Ky., Thursday, Feb. 18, 2010. [Agencies]
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The twin developments created new public relations challenges for Toyota plus the prospects - however likely or unlikely - of hefty federal fines or even indictments against executives in the US and Japan. They also complicate Toyota's ability to discuss details driving its recall of 8.5 million vehicles because anything executives say could be used against the company inside a courtroom.
In an opinion piece published by The Wall Street Journal, Toyota's president acknowledged the automaker had stumbled badly.
"It is clear to me that in recent years we didn't listen as carefully as we should - or respond as quickly as we must - to our customers' concerns," wrote Akio Toyoda, who is the grandson of the company's founder.
In a new filing with the SEC, Toyota said it received the grand jury request from the Southern District of New York on February 8 and got the SEC requests Friday.
It wasn't immediately clear what US 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 US 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.
The government could be looking into product safety law violations or whether Toyota made false statements to a federal safety agency involving unintended acceleration or the Prius braking system, said Peter Henning, a law professor at Wayne State University in Detroit. The SEC is seeking documents related to unintended acceleration as well as to its disclosure policies and practices, Toyota said.
Legal experts said the fresh subpoenas could affect how Toyota executives respond to the questions from lawmakers.
