Senate bill promises prison time for execs who hide safety defects

Two Senators are reportedly preparing to introduce a bill that would directly punish executives for knowingly hiding safety defects from the public.

Authored by Sens. Richard Blumenthal (D-Conn.) and Bob Casey (D-Pa.), the Hide No Harm Act of 2014 serves as a response to the General Motors ignition-switch debacle. Legislators have accused the company of maintaining a cover-up for more than a decade after the problems first surfaced, contributing to at least 13 deaths and potentially dozens more.

Companies and corporate officers would be required to notify federal agencies within 24 hours of discovering a safety issue, significantly reducing the current five-day span that automakers can currently wait before informing the National Highway Traffic Safety Administration. The language has been written broadly, however, potentially affecting a wide range of industries.

Executives who violate the proposed laws would face up to five years in prison, while whistleblowers would be immune from federal prosecution.

Following several record settlements with the Department of Justice over corporate wrongdoing — mostly aimed at the financial industry — some critics argue that the “too big to jail” approach does little to change misbehavior. Toyota was recently hit with a $1.2 billion settlement related to the unintended-acceleration recalls, which followed numerous fatal accidents, however no executives ever faced criminal charges.

GM reportedly faces potential federal fraud charges over the ignition-switch recall, with other actions expected to be taken at the state level.