DoJ fines Japanese parts firms $740M in massive automotive price-fixing scandal

Nine Japanese suppliers have pleaded guilty in US court over charges of price fixing in the automotive parts industry, resulting in the Department of Justice doling out a total of $740 million of fines, according to a report from Bloomberg. The scandal, which has resulted in General Motors, Ford, Toyota and Chrysler spending up to $5 billion on inflated parts and driving up prices on 25 million vehicles has sent the DoJ hustling into investigations. "The conduct this investigation uncovered involved more than a dozen separate conspiracies aimed at the U.S. economy," Attorney General Eric Holder (pictured above) said during yesterday's press conference.

As the investigation stands, the DoJ has issued $1.6 billion in fines against 20 companies and 21 individual executives, with 17 of the execs headed to prison. Deputy Assistant Attorney General Scott Hammond said, "The breadth of the conspiracies brought to light today are as egregious as they are pervasive. They involve more than a dozen separate conspiracies operating independently but all sharing in common that they targeted US automotive manufacturers."

Big-name suppliers indicted in the investigation include Mitsubishi Electric, Mitsubishi Heavy Industries, Hitachi Automotive and Mitsuba Corporation. A list of fines and other corporations named in the investigation is available at Bloomberg.

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In the absence of more Pa. funding, SEPTA anticipates massive cuts

SEPTA has shared a drastic vision of the future. The transit agency serving Southeast Pennsylvania threatens to shut down nine of 13 regional rail lines and implement other cuts if the state does not provide more funding.

The shortfall in SEPTA's budget for capital investments is unprecedented, said Rich Burnfield, SEPTA chief financial officer. The agency is running rail cars "put in place when Gerald Ford was president," he said.

The aging regional rail lines require the most expensive repairs, SEPTA officials said. Without those repairs, the agency anticipates closing nine lines and truncate others closer to Philadelphia over the next decade.

It's estimated those changes would displace 89,000 riders a day -- adding up to more than 40 million rides in a year. Right now, SEPTA's ridership is at an all-time high.

Pennsylvania's Senate this summer passed legislation that would provide SEPTA with an additional $500 million -- enough, say SEPTA officials, to avert a true crisis. But the deal has stalled in the Pennsylvania House, which is expected to take up the issue again this fall.

The state Department of Transportation is also urging the House to act on funding officials say is urgently needed for bridge and road repairs.

"What we're seeing from SEPTA is not having enough resources for our transportation system [...] It is another unfortunate reality that we're looking at with the shortfall in transportation funding," said Erin Waters, a PennDOT spokeswoman.

House Republicans' spokesman, Steve Miskin, dismissed SEPTA's announcement as "the agency's semi-annual sky is falling PR effort."

"The fact is SEPTA is locally managed. The decisions are locally made and the contracts are locally negotiated," Miskin said. "This is an issue that is in local control."

He said there has been work over the summer on transportation planning, adding that lawmakers are considering how to fund the "critical needs of Pennsylvania infrastructure."

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