Auto Industry Fraud

The safety of hundreds of millions of Americans depends on the integrity of car manufacturers. Until recently, however, employees who saw and reported fraud in the auto industry did not have an adequate path to justice.

A law enacted in December 2015, The Motor Vehicle Safety Whistleblower Act, is designed to ensure that auto industry employees have financial incentives to report fraud, as well as certain legal protections against retaliation.

This law covers both contractors and employees, and applies to individuals who work for manufacturers, dealerships and suppliers.

When you report fraud that could result in over $1 million in federal recoveries, you can collect anywhere between 10% and 30% of the recovered amount as a reward.

The Motor Vehicle Safety Whistleblower Act contains a nondisclosure clause, so that the identity of whistleblowers is protected for as long as possible throughout the investigation. This is an important measure for whistleblowers who may be concerned about retaliation from their employers.

Whistleblowers can be rewarded for reporting the following types of infractions:

  • Reporting violations
  • Compliance violations
  • Motor vehicle defects

 

The importance of auto industry whistleblowers

In 2014, General Motors was forced to recall millions of vehicles after an issue with the ignition switch raised safety concerns. Even a small design flaw can pose a risk, and companies who know of these issues and fail to act should be held accountable.

False advertising can also prompt auto whistleblowers to speak up. In order to market their vehicles, car companies have to be truthful about the features those products do and don’t have. Volkswagen continues to face scrutiny after lying about the emissions tests on vehicles marketed as eco friendly.

Reporting information about known defects or harmful design flaws in vehicles can save lives. In an ongoing lawsuit, airbag manufacturer Takata has been accused of knowingly selling airbags with potentially dangerous defects.

When ruptured, some airbags have released shrapnel; the products have caused at least 11 deaths and many more injuries. As a result, tens of millions of Takata airbags have been recalled.

In order to strengthen their evidence against Takata, the federal government requested the help of company and industry whistleblowers. The reports of those whistleblowers were instrumental in demonstrating that Takata had known about these dangerous design defects for many years, yet continued to sell the airbags.

To report auto industry fraud or learn more about your rights as a whistleblower, contact us confidentially today.