GM fined $11 million in recall of 470,000 Cadillacs Catalytic converters effectively were disabled


WASHINGTON -- General Motors Corp. has agreed to recall almost a half-million Cadillac automobiles and pay an $11 million civil penalty to settle government charges that it tampered with pollution-control equipment on the vehicles, the Justice Department said yesterday.

The settlement, which officials described as "precedent setting," was the first to require auto recalls for violations of federal environmental rules, which were issued under the auspices of the Clean Air Act.

The government had alleged that GM illegally altered the fuel-mixture system by installing a computer-chip in Cadillacs that negated the catalytic converters. The converters would stall the engines when the climate control system was turned on.

The consent decree, which follows two years of negotiations between the government and GM, is expected to affect 470,000 Cadillacs built between 1991 and 1995 -- including the Seville, DeVille, El Dorado and Fleetwood models -- that were equipped with a 4.9-liter engine.

BTC It will not affect Cadillacs in the 1996 model year that currently are in dealers' showrooms. U.S. officials said GM had replaced the offending computer chip and changed the engine sufficiently to eliminate any violations of federal rules.

Attorney General Janet Reno, who announced the consent order, estimated that the settlement could cost GM $30 million- $45 million -- including $11 million for the civil penalty. The cost of refitting the cars was put at $25 million-$30 million.

In addition, GM has agreed to set up a multimillion-dollar fund to help foster cleaner air through projects such as buying back old pollution-prone school buses and purchasing new ones that burn cleaner fuels -- a program that could cost between $7.05 million and $8.75 million.

As is customary in such cases, GM did not admit that it had been guilty of the charges, and Justice Department officials took pains to say the company had been responsive in trying to work out a settlement.

GM spokesmen said the company would reserve comment until today. Under the consent agreement, GM is required to notify owners of the affected vehicles that it is prepared to make the prescribed changes at no cost to the owner.

Carol M. Browner, the Environmental Protection Agency's administrator, said the installation of the chip represented "an intentional effort to override appropriate emissions controls," pumping 100,000 tons of carbon monoxide into the atmosphere.

Ms. Browner said even at limited levels, carbon monoxide gas can lead to headaches, impaired vision and increased risk for persons with heart disease. In high concentrations, it is poisonous as well. "This is a serious violation," she said.

Spokesmen for environmental groups hailed the federal action, while criticizing GM for what they characterized as an intentional violation of the law.

David G. Hawkins, a senior attorney with the Natural Resources Defense Council, called GM's action in trying to nullify the emissions a "decision to not play by the rules, and to manufacture a car that was more polluting."

He also called the settlement evidence that current environmental regulations should not be repealed. "If EPA and the Department of Justice don't have the authority to enforce these regulations, they might still be going on today," he said.

Federal officials said the problem arose early in 1991, when GM ** began receiving complaints from Cadillac owners that their cars would begin to stall whenever they turned on the heater or air-conditioner.

After investigating the problem, they said, GM decided to fix it by installing a new computer chip that altered the fuel mixture to make it richer -- with more fuel and less air -- whenever the cars' climate controls were used.

Justice Department officials said while that cured the stalling problem, it effectively disabled the cars' catalytic converters, causing them to spew out between two and three times the pollutants that federal rules permit.

They said EPA investigators discovered the flaw in 1993 during a re-evaluation of federal standards in light of changes that Congress enacted in the Clean Air Act. The problem was brought to GM's attention.

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