Major automaker pleads guilty in fraud scheme targeting US customers: 'Will be held criminally accountable'

Yahoo

05-04-2025

A subsidiary of Toyota has pleaded guilty to skirting pollution laws and conspiracy to defraud consumers in the United States. The Department of Justice announced that it slapped Hino Motors with a hefty fine, but questions remain about its long-term impact.
On March 19, the DOJ announced it had ordered Hino Motors to serve five years' probation — banning it from importing its diesel engines — as part of a guilty plea after charging the Japanese truck and engine manufacturer with one count of conspiracy to defraud the U.S., to violate the Clean Air Act, to engage in wire fraud, and to smuggle goods into the country.
Hino will also pay more than $1.6 billion in penalties. According to the government, the company submitted false applications for engine certification approvals between 2010 and 2019, conducting improper emissions tests, altering and fabricating data, and failing to disclose software that could impact pollution-control systems.
The company "imported and sold over 105,000 non-conforming engines between 2010 and 2022," per the DOJ. However, Reuters reported Hino falsified emissions data for some of its products as far back as 2003, according to a panel commissioned by the company itself.
"By pleading guilty, Hino Motors, Ltd. has admitted to orchestrating a deliberate and years-long fraud scheme that put profit over principle," James C. Barnacle Jr., acting assistant director of the FBI Criminal Investigative Division, said in a statement.
Hino's business practices not only gave it an unfair advantage over businesses that adhered to U.S. regulations to limit pollution, as explained in the announcement by Adam Gustafson, acting assistant attorney general of the DOJ Environment and Natural Resources Division.
The company's actions also meant buyers likely had skewed perceptions about how much pollution was associated with their purchasing decisions. The misinformation might have set back their sustainability goals without warning, raising questions about the potential long-term impact of the deception on community and environmental health.
Electric vehicles are more eco-friendly than gas-powered vehicles, as they don't spew any tailpipe pollution. However, as the Environmental Protection Agency notes, modern regulations ensure diesel engines are cleaner than they were in years past.
This is particularly important because diesel engines produce ground-level ozone, which can damage crops, and acid rain that can contaminate our waterways and thus enter our food chain. The exhaust is also connected to respiratory problems and heart disease.
According to Reuters, Hino President Satoshi Ogiso said in January that the company reviewed and improved its compliance and oversight practices.
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The fact that Hino lost around $1.5 billion in the second quarter to cover litigation costs, along with the hefty fine and lost business in the U.S. during the five-year probationary period, may prove to be a deterrent and push Hino to live up to those promises of improvement.
"Today's plea and sentencing demonstrates that companies who intentionally evade our nation's environmental laws, including by fabricating data to feign compliance with those laws, deserve punishment and will be held criminally accountable," Jeffrey Hall, acting assistant administrator for the EPA Office of Enforcement and Compliance Assurance, said in the DOJ release.
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