Authorities are investigating whether General Motors hid an ignition switch defect when it filed for bankruptcy in 2009, the New York Times has reported. The Justice Department is investigating if the automaker committed bankruptcy fraud by not disclosing the ignition switch problem, which led to the recall of 1.6 million vehicles last month. It is also being investigated as to whether GM understated the defect to federal safety regulators. The ignition switch defect has been linked to 12 deaths and the company is facing multiple investigations into how it handled the recall.
GM has been hit with a lawsuit demanding it be held liable for allegedly concealing ignition problems before its 2009 bankruptcy. The lawsuit also claims GM was responsible for not reporting to the federal government any safety-related problems for cars made before its bankruptcy. This is just the latest in a string of lawsuits filed against the company since the recall was announced.
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