GM India Found Guilty of Corporate Fraud by Indian Government Panel
General Motors Co.’s (NYSE:GM) India division has been found guilty of committing corporate fraud by a government-appointed panel, which is holding the unit’s top executives responsible for the infractions, according to a report from the Times of India.
The charges relate to 114,000 of the company’s Tavera SUVs that were recalled in July after it was found they violated the country’s emissions standards. The Tavera recall was one of the largest-ever automobile recalls in India. General Motors restarted the production of the vehicles over the weekend, a company official told Reuters on Saturday, and now information about the Indian government’s report on GM India’s violations is starting to come out.
The government report accuses GM India’s top executives between 2005 and 2012 of knowledgeably violating engine testing and compliance of production norms. A senior government official who has seen the report told Reuters that “It says only the OEM (original equipment manufacturer) was responsible for whatever happened,” and GM India could be fined $1.6 million for the infractions.
According to the Hindustan Times, GM India admitted to refitting noncompliant engines with engines that were already approved, leading to Tavera vehicles on Indian roads that didn’t meet the country’s emissions standards. GM India found out about the infractions through an internal probe and fired several executives as a result, including Chief Financial Officer Anil Mehrotra.