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Toyota slapped with $17.4M record fine

(Photo courtesy of Toyota)

December 18, 2012 12:00:00 AM PST
Toyota Motor Corporation has agreed to pay a record $17.4 million fine for failing to quickly report a safety defect, and for delaying a safety recall.

The fine is the maximum allowed by law for a single investigation.

Toyota will be making the payment to the National Highway Traffic Safety Administration without admitting to any violation of U.S. laws.

"We agreed to this settlement in order to avoid a time-consuming dispute and to focus fully on our shared commitment with NHTSA to keep drivers safe," Ray Tanguay, the company's chief quality officer, said in a statement.

The fine stems from a Lexus recall reported in 2012 to fix floor mats that trapped the gas pedal, causing vehicles to accelerate without warning.

Officials notified Toyota of the problem, but it took the company a month to report 63 incidents of floor mats trapping gas pedals.

The agency began investigating the Lexus SUVs following complaints from consumers.

The record fine is the fourth fine assessed against Toyota in the past two years, and the largest single fine ever levied against a car company.

The latest settlement, on top of two $16.4 million fines and one $16 million fine Toyota paid in 2010 for reporting violations, brings the total penalties levied on the company to $66.2 million. It caps a difficult year for the world's No. 1 automaker, which recalled more than 14 million vehicles globally since the fall of 2009 as it scrambled to protect its reputation for safety and reliability.

The Associated Press contributed to this report.