NEW YORK (TheStreet) -- General Motors (GM) is facing a criminal prosecution and may have to pay a record fine to resolve charges related to its faulty ignition switches. Reportedly, details of the guilty plea and potential fine still need to be worked out.
The switches, which shut some cars off while traveling at high speeds, have been linked to more than 100 deaths. The Wall Street Journal reported the U.S. Department of Justice soon-to-be-unveiled criminal case against the company appears to revolve around the fact that General Motors failed to disclose the problem with the switches in Chevrolet Cobalts and other older cars.
The US. Attorney General's Office in Manhattan believes the company hid problems with misstatements for over a decade. A deferred-prosecution agreement would mean the company would face charges that would be suspended and ultimately dismissed if it abides with prosecutors' terms.
Prosecutors' investigation is at an advanced stage, though the criminal case may yet fall apart, some of the people said. Prosecutors believe that GM is likely to strongly argue against a guilty plea, one of the people familiar with the matter said. If the case moves forward, it would be the second brought by U.S. prosecutors in an unprecedented crackdown on auto makers for safety problems.
The Justice Department previously brought criminal charges against Toyota (TM). In that case, the company entered into a deferred-prosecution agreement and was fined over sudden-acceleration problems, which were implicated in a number of deaths. Toyota acknowledged wrongdoing in its settlement.
The Justice Department is also investigating another Japanese company, parts supplier Takata, over rupture-prone air bags linked to at least six deaths that have spurred a recall of nearly 34 million vehicles.
General Motors shares are trading around $35.50, down from the 52-week high of $38.87 reached on March 20.