U.S. Senate Committee Approves Auto Safety Whistleblower Bill

Senator Nelson of Florida

Response to High Number of Recalls in 2014

The U.S. Senate Commerce Committee approved a bill that allows whistleblowers who report auto safety hazards to receive a percentage of fines and judgments against the offending companies.

The law was introduced in response to the record numbers of recalls in 2014, many of which occurred only after manufacturers were forced to do so. General Motors knew of its faulty ignition switch for more than a decade before issuing its first recall. In the meantime, hundreds of accidents in G.M. vehicles resulted in unnecessary deaths and injuries. In addition, Takata was well aware that shards of metal could shoot into the passenger compartment during airbag deployment, yet did nothing to rectify the problem until dozens of people were killed and maimed. Both companies took pains to hide the defects to avoid financial liability.

The proposed whistleblower legislation is designed to encourage individuals with knowledge about safety violations to step forward.

Whistleblowers Cash-In to Stop Auto Manufacturer Negligence

Under the legislation, whistleblowers who report problems not previously known to regulators are entitled to a percentage of money federal agencies recover from negligent automakers. A whistleblower may receive up to 30 percent of penalties in excess of $1 million for reporting claims related to auto defects, safety noncompliance and violations of reporting requirements that are likely to result in risk of severe injuries or fatalities. The law also protects the identities of whistleblowers to prevent retaliation.

The legislation would apply retroactively, so whistleblowers who choose to come forward now about previously undiscovered wrongdoing would qualify for compensation.

Bipartisan Support for Auto Safety Measures

The law, modeled after IRS and SEC whistleblower programs, won bipartisan support in committee. Democrats and Republicans rarely agree on anything, and we applaud their unity on the issue of automotive safety.

Senator John Thune, Republican of South Dakota and Senator Bill Nelson, Democrat of Florida, cosponsored the bill. Senator Thune is Chairman of the Committee on Commerce and Senator Nelson is the Committee’s top Democrat.

In a New York Times interview, Senator Thune said, “While I believe most manufacturers are dedicated to putting vehicle safety first, there have been disappointing examples where that did not happen and Americans died and sustained serious injuries.”

Senator Nelson said, “Auto industry needs to be held accountable. … One way to do that is to encourage insiders to come forward and tell the truth.”

Next stop is the full Senate. If the Senate passes the bill, the U.S. House Energy and Commerce Committee considers approval. Then the full House would have to pass the legislation.

As an advocate for auto accident victims, Bill Berenson supports this legislation, which holds automakers accountable for the injuries and fatalities resulting from their negligence.

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