GM Resolves SEC Ignition Switch Probe
Image courtesy of SEC.
General Motors has agreed to pay a $1 million penalty to settle charges that faulty accounting controls prevented the automaker from properly assessing how a defective ignition switch — and resulting recalls — might affect the company’s financial statements, according to the U.S. Securities and Exchange Commission.
The settlement is tied to GM's 2014 ignition switch safety recalls.
The SEC’s order finds that GM’s internal investigation involving the defective ignition switch wasn’t brought to the attention of its accountants until November 2013, even though other company personnel grasped the safety issue at hand in the spring of 2012.
“Internal accounting controls at General Motors failed to consider relevant accounting guidance when it came to considering disclosure of potential vehicle recalls,” said Andrew M. Calamari, director of the SEC’s New York Regional Office.
Without admitting or denying the charges, General Motors consented to the SEC’s order finding that the company violated a section of the Securities Exchange Act by “not devising and maintaining a sufficient system of internal accounting controls.”