Takata Corporation Agrees To Pay $1 Billion For The Airbag Fraud

Takata Corporation, one of the largest supplier of safety-equipment in the world has been penalised for sale of defective airbags. The company has agreed to plead guilty and pay $1 Billion in penalties.

The company has been charged over handling of its airbag ruptures that caused 16 deaths worldwide including 11 in the U.S. In addition, 180 people have been reported injured in accidents in which the airbag's inflator ruptured unexpectedly throwing metal pieces at the driver and passengers. This is being termed as worst auto safety crisis in the U.S history reports Forbes.

 The company has now agreed to pay a fine of $1 Billion which includes $25 Million criminal fine, $850 million as a compensation fine to automakers who have suffered numerous recall of their vehicles and $125 Million in victim compensation for the people who have suffered. The list includes 19 automakers and 42 million vehicles which were recalled as reported by WallStreetJournal.

The company admitted that it provided "selective, incomplete or inaccurate data" to the National Highway Traffic Security Administration which dated back by atleast six years reports JapanTimes. In 2015 also, Takata was aware of the issue with its handbags and did not issue a recall on time. The company had previously made a settlement with U.S automakers for $70 Million in 2015.

The company started producing airbags filled with ammonium nitrate in 1990. But it was not until 2000's that the company realized that ammonium nitrate inflators were not meeting the specifications laid down by auto manufacturers. Nevertheless, the company produced the airbags by submitting false information and manipulating the safety data. This false data made the performance of the airbags inflators appear better than it actually was.The company has agreed to pay guilty and pay a hefty fine but the losses that are made cannot be recovered.