GM ignition fund ends review approving 124 death claims – The Detroit News
Washington —After examining more than 4,300 claims, General Motors ignition compensation program has concluded that faulty ignition switches were to blame for 124 death and 274 injuries, officials said Monday, adding that the outcome of six less serious claims have yet to be determined.
Officials for GMs’ ignition compensation fund said Monday it has completed its review of all fatal claims in their year-long program. GM announced its ignition fund in June 2014 and the fund accepted claims for six months starting Aug. 1. Submission for claims ended Jan.31 after the initial deadline was extend by a month after some owners said they were unaware of the program and were mailed notice late in 2014.
The fund is run by lawyer Ken Feinberg — the administrator of the 9/11 victims, Boston Marathon and other compensation funds. GM is paying at least $1 million in each death claim.
The fund’s deputy administrator, Camille Biros, said Monday the fund still has some work to do. “We have not yet completed the process of valuing and transmitting official offers to eligible claimants,” Biros said Monday in an email and she noted that “all official offers provide claimants with a 90-day period (on a rolling basis — depending upon the date of the offer letter) to respond by either accepting or rejecting the offer.”
She noted that there are currently more than 100 offers outstanding — which have neither been accepted nor rejected. Many of the accepted offers still not have been paid “pending releases and/or other required payment documentation.”
“When these statistics are available, they will provide a complete picture of the status and success of the program,” she said.
The automaker initially said last year that 13 deaths were related to Chevrolet Cobalts, Saturn Ions and other cars with ignition switches that can inadvertently shut off the engine and disable power steering and air bags. GM delayed recalling the cars for nearly a decade even after some within the company became aware there was a problem.
The automaker came under harsh criticism from Congress for failing to do more to respond to the crisis. GM CEO Mary Barra blamed the company’s failure to act on a pattern of incompetence and neglect. She fired 15 employes and disciplined five after a scathing internal report.
GM said last month it now expects to spend $625 million on compensation efforts — up from its most recent estimate of $550 million. The automaker said it has paid $280 million in claims.
Biros said last week the fund has made 319 offers — including 95 for deaths — and 227 have been accepted, while six have been rejected and 86 are outstanding.
GM stopped updating its own count of deaths or injuries related to the ignition problem last year and has offered few details about the victims who have received compensation.
The Justice Department is nearing a decision on whether to charge GM criminally in connection with the delay. GM could also face a fine expected to top $1.2 billion — the amount Toyota Motor Corp. paid last year after it was charged with wire fraud. A decision is expected by the end of summer or fall.
Several reports have suggested it is unlikely that individual GM employees will be charged — or that the government will seek to charge GM with bankruptcy fraud. GM is most likely to be charged with wire fraud as part of a settlement — similar to the charge Toyota faced.
The U.S. Attorney’s Office in Manhattan is being aided by a federal grand jury, the FBI, 50 state attorneys general, the Securities and Exchange Commission and Transport Canada in an investigation of GM’s delayed recall.
In total, 4,342 claims were submitted by the Jan. 31 deadline, including 474 death claims — which was extended by a month over the initial plan. A total of 3,664 claims have been ruled ineligible, including 338 deaths.
Neither GM nor the fund have disclosed any concrete details about who has been approved for compensation or demographic characteristics of those approved.
The first trial stemming from the dozens of suits filed against GM and consolidated in front of a federal judge in New York is set to start in January. Lawyers are deposing dozens of current and former GM executives, including GM CEO Mary Barra set for October and former CEO Rick Wagoner in September.
Some Wall Street analysts have speculated GM may have to pay a fine to resolve the investigations that could top $2 billion. GM in May 2014 paid a $35 million fine to the National Highway Traffic Safety Administration to resolve its investigation and agreed to up to three years of intense monitoring. Last month, NHTSA said it was extending the monitoring until at least May 2016.