Vehicle Safety Fraud
The federal government works hard to ensure the safety of millions of vehicles on America’s roads. But vehicle manufacturers too often fall short. In recent years, American consumers have learned of air bags that kill and maim, instead of saving lives. They’ve been faced with cars that accelerate when drivers don’t push the gas pedal. And they’ve been told not to park certain cars in a garage or near a home because they may spontaneously catch fire.
Vehicle safety regulators rely on whistleblowers to help keep people safe.
What is The Motor Vehicle Safety Whistleblower Act?
The Motor Vehicle Safety Whistleblower Act established a whistleblower reward program run by the National Highway Traffic Safety Administration (NHTSA) that pays awards to auto-industry insiders who confidentially provide information to regulators about safety lapses in vehicles. The law also protects such insiders from retaliation.
What kinds of vehicle safety fraud can whistleblowers report?
NHTSA’s whistleblower program gives industry insiders an incentive to bring to light violations of the National Traffic and Motor Vehicle Safety Act. The law requires vehicle manufacturers to notify NHTSA of all safety-related defects in vehicles and vehicle equipment that pose an unreasonable risk of accident, death, or injury. The notification process is central to NHTSA’s ability to investigate potential defects, identify unsafe vehicles and equipment, and ensure they are fixed.
Many manufacturers fail to notify NHTSA when they become aware of potential safety-related defects. Sometimes this is because the manufacturer wants to study the issue to identify its root causes or scope. Other times, manufacturers do not notify NHTSA because they want to avoid costly recalls and reputation-threatening headlines. NHTSA relies on industry insiders to come forward with evidence of potential safety-related defects when manufacturers refuse to obey the law.
The law also requires vehicle manufacturers to comply with Federal Motor Vehicle Safety Standards (FMVSSs). These are federal regulations that concern the design, construction, performance, and durability of vehicles and vehicle systems. Industry insiders who know about violations of FMVSS requirements can also report this information under NHTSA’s whistleblower award program.
Can a whistleblower get an award for exposing vehicle safety fraud?
Under the Motor Vehicle Safety Whistleblower Act, a whistleblower can receive from 10-30% of any monetary sanctions over $1 million that the government collects based on the information the whistleblower provides.
Awards are based on the significance of a whistleblower’s information, the extent of the assistance the whistleblower provides, and in some cases, whether the whistleblower reported the information internally.
Whistleblowers can report information to NHTSA confidentially, and the agency works diligently not to reveal the identity of a whistleblower.
The law also protects vehicle safety whistleblowers from retaliation by their employers. The Occupational Safety and Health Administration (OSHA) administers those protections.
Who can blow the whistle on vehicle safety fraud?
Any employee or contractor of a motor vehicle manufacturer, part supplier, or dealership may be a whistleblower.
Auto-safety whistleblowers can come from anywhere in the world. And the misconduct they expose can occur outside of the U.S., as long as the vehicles or components at issue are present in the U.S. market.
Whistleblower Partners are experienced vehicle safety fraud attorneys
Whistleblower Partners is the most experienced and successful law firm in the country representing vehicle safety whistleblowers and handling automotive-related whistleblower actions.
Our attorneys represented the only whistleblower who has received a whistleblower award from NHTSA to date—an engineer who earned $24.3 million for promptly alerting regulators to a concealed defect in Hyundai and Kia engines. Our attorneys also obtained more than $1 million on behalf of two individuals who provided information to the U.S. government in its criminal action against Takata, the now-defunct maker of defective airbags that have claimed dozens of lives. In addition, our attorneys secured an $8 million settlement on behalf of a whistleblower client in a False Claims Act lawsuit against one of the largest aftermarket brake and chassis parts distributors in North America.
We are vehicle safety fraud experts. We enjoy strong working relationships with government enforcers who investigate and prosecute vehicle safety fraud. Our attorneys have been actively involved in developing the rules to implement the vehicle safety whistleblower program and have been forceful advocates for the program from its inception.
Representative cases
Hyundai: Whistleblower Partners attorneys represented former Hyundai engineer Gwang Ho Kim, who exposed Hyundai and Kia’s efforts to conceal a design flaw that put engines in millions of vehicles at risk of catching fire. In the end, Mr. Kim got justice–and received a record-breaking award that changed his life. The carmakers agreed to pay up to $210 million, of which $24.3 million went directly to Mr. Kim.
Takata: Several Whistleblower Partners attorneys represented Mark Lillie and an anonymous whistleblower who reported Takata’s explosive airbags that claimed the lives of 22 people and set off a worldwide recall of nearly 100 million airbag inflators. In January 2017, Takata pled guilty and agreed to pay $1 billion in criminal penalties due to its fraudulent sales of defective airbag inflators. The whistleblowers received the first recovery under the Motor Vehicle Safety Whistleblower Act.
Centric: Whistleblower Partners attorneys represented Steve Hughes in a case against his former employer, Centric Parts, alleging that the auto parts distributor knowingly misclassified brake pads imported from Asia to avoid tariffs owed to the United States government. The case resulted in an $8 million False Claims Act settlement, and $1.48 million of that went directly to Hughes and another whistleblower.
These descriptions of vehicle safety fraud are general in nature and do not constitute legal advice. The attorneys at Whistleblower Partners understand the complicated, constantly changing legal landscape concerning vehicle safety fraud and are happy to discuss any potential matter further.
If you would like more information or would like to speak to an attorney at Whistleblower Partners, please contact us for a confidential consultation.