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Eight US states investigates GM ignition-switch defect
The entrance of the General Motors of Canada head office is seen in Oshawa March 31, 2009. u00e2u20acu201d Reuters pic

CHICAGO, June 12 — General Motors Co’s delayed decision to recall almost 2.6 million cars for ignition-switch defects is being investigated by attorneys general in Florida, Connecticut and at least six more states.

GM has acknowledged 13 deaths tied to the defect, which can cut power to a vehicle’s steering and brakes and prevent air bags from deploying in a crash. Company executives were aware of the defect for at least a decade before the recall.

“We are a member of a multistate group that is looking into complaints about General Motors,” Whitney Ray, a spokesman for Florida Attorney General Pam Bondi, said yesterday.

Connecticut, too, is part of a multistate probe, said Attorney General George Jepsen’s spokeswoman, Jaclyn Falkowski. Representatives of attorneys general in Arkansas, Illinois, Iowa, Kentucky and Louisiana independently confirmed similar investigations yesterday. Indiana AG Greg Zoeller also is investigating GM’s handling of the recall, said Jaime Barb, a spokeswoman.

The Detroit-based automaker fell 27 cents to US$36.13 (RM116.07) yesterday on the New York Stock Exchange. The shares are down almost 12 per cent this year.

The company this month fired 15 people it said played a role in the recall delay. It announced the firings immediately after releasing the results of an internal investigation led by former Chicago US Attorney Anton Valukas, now chairman of the law firm Jenner & Block LLC.

GM faces about 85 federal lawsuits filed by car owners claiming their vehicles lost value as a result of the recall and more claims over injuries and deaths attributed to crashes.

Cases moved

Federal judges two days ago transferred the economic-loss cases filed across the nation to US District Judge Jesse Furman in New York. He will preside over pretrial litigation and disclosure of evidence.

James Cain, a spokesman for GM, declined yesterday to comment on the state investigations, deferring to company filings and the Valukas report.

In an April filing with the US Securities and Exchange Commission, GM said it was the subject of “various inquiries, investigations, subpoenas and requests for information” from the office of US Attorney Preet Bharara in New York, the US Congress, the National Highway Traffic Safety Administration, the SEC and one state’s attorney general.

The company said that it was cooperating fully in those probes and that they might “result in the imposition of damages, fines or civil and criminal penalties.” — Bloomberg

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