GM to pay out $120M in ignition switch settlement

General Motors Co. on Thursday agreed to pay $120 million to resolve claims from 49 USA states and the District of Columbia over faulty ignition switches, state attorneys general said.

Since disclosing the defect, GM has paid a $900 million fine to end a criminal investigation by the U.S. Department of Justice and settled a class action brought by investors for $300 million.

The extensive agreement outlines GM's obligations to honestly advertise the safety records of its cars and to maintain global organizations dedicated to vehicle safety and product integrity.

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New York Attorney General Eric Schneiderman said in a statement GM had "turned a blind eye for years and chose to hide the safety defects associated with several models of their vehicles".

Maintain a Vehicle Safety Owner Engagement Team to improve and enhance recall awareness to auto owners with open recalls - GM has to provide a report within 60 days after the one-year anniversary of this agreement summarizing their efforts.

The 49 states involved in the settlement said certain employees at General Motors knew of the issues as early as 2004, but decided it wasn't a major safety concern, delaying recalls.

GM will pay 49 states, including Pennsylvania and NY, $120 million in a lawsuit that accuses company officials of concealing safety issues related to the ignition switches.

In all, the settlement covers seven GM recalls in 2014 affecting more than nine million vehicles, multiple state attorneys general said.

"The resolution includes a financial component, and assures GM will continue ongoing improvements made to ensure the safety of its vehicles", GM said.

Connecticut's share of the $120 million settlement is $3,206,587.58, of which $350,000 will be deposited in the Attorney General's Consumer Protection Fund and the remainder will go to the state's General Fund. Dealerships must make sure recall repairs are complete before they can sell the vehicle. In addition, GM will not be allowed to market vehicles as "safe" unless it has complied with the Federal Motor Vehicle Safety standards as it is applicable to the vehicle.

The settlement is not final unless and until approved by the court.

  • Tracy Klein