NHTSA gives $24 million to whistleblower

On Behalf of | Dec 23, 2021 | Consumer Fraud, Lemon Law |

We spend a lot of time discussing important recalls authorized by the National Highway Traffic Safety Administration (NHTSA). We do this to alert consumers about risks associated with vehicles recalled due to a design flaw. These flaws are often brought to the attention of the manufacturer because of a consistently high or troubling number of vehicle repairs necessary for the safe use of a vehicle. The customers and dealerships are often the first to recognize these problems.

The NHTSA now has another course of action. On November 9, the administration announced that it awarded $24 million to a whistleblower who provided crucial information regarding Hyundai Motor America and Kia Motors America’s violation of the Vehicle Safety Act. Last November, it authorized the recall of 1.6 million vehicles model years 2011-2019 equipped with the Theta II engine. The award is the maximum 30% of $81 million in cash penalties paid by the manufacturers, which the same Korean company owns.

“Whistleblowers play a crucial role in bringing information to NHTSA about serious safety problems that are hidden from the agency,” said Dr. Steven Cliff, NHTSA’s Deputy Administrator, in a press release. “This information is critical to public safety and we are committed to rewarding those who bring information to us.”

Vehicles affected

The 4-cylinder engine used in Hyundai’s Sonata, Santa Fe, Santa Fe Sport and Tucson models and Kia’s Optima, Sorento and Sportage was deemed defective after reports of:

  • Loud engine knocks
  • Excessive oil consumption
  • Stalls
  • Engine fires

The manufacturer inaccurately reported the problem, downplaying the issue and denying a design flaw. Its solution was then to develop temporary fixes that did not solve the problem. The anonymous whistleblower brought this deceit to the attention of the regulatory authorities.

More awards likely to come

The laws and protocols for whistleblowers are still in development, but there is currently a web page accepting information. The magnitude of this first award will likely prompt others to step forward with information about manufacturer coverups and denials. The hefty penalties could also encourage the companies to come forward if there is a safety risk or design defect.