The National Highway Traffic Safety Administration (NHTSA) has announced it will be paying out a whistleblower award to a former Hyundai safety engineer who reported an engine defect in 2016, which Hyundai failed to address, that was causing vehicles to seize up and even catch fire. NHTSA found that Korean car manufacturer Hyundai and its Kia subsidiary had given inaccurate information regarding the problems and delayed recalling vehicles. This led to a 2020 decision in which the NHTSA ordered Hyundai and Kia to pay $210 million in penalties, of which $81 million was paid to the United States government.
The whistleblower is set to receive the maximum award possible, 30% of the collected $81 million, which amounts to $24.3 million. “I am pleased that I have been justly compensated for the risks I took to protect owners of these defective cars, and grateful that the U.S.’s legal system had a program in place to make this possible. I hope my reporting leads to real safety improvements, both at Hyundai and throughout the industry,” he said.
Congress passed the Motor Vehicle Safety Act in 2015, which also created a whistleblower program for the Department of Transportation that could award up to 30% of collected monies to a whistleblower who significantly contributes to an action where penalties total more than one million dollars.
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The False Claims Act prohibits people and companies from defrauding the federal government by knowingly presenting, or causing to be presented, a false claim for payment or approval. The act is designed to prevent losses to the federal government. Violations of the False Claims Act can result in judgment in an amount equal to three times the amount of losses the U.S. Treasury sustained, plus civil fines.
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