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February 19, 2013 01:00 AM

Auto supplier price-fixing probe continues

David Sedgwick, Automotive News
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    DETROIT—The U.S. Department of Justice has levied $809 million in fines, convicted 12 executives and coaxed guilty pleas out of nine automotive suppliers, but its price-fixing probe is far from finished.

    The department's antitrust investigation of automotive suppliers "has grown over time and is broader than what we've announced so far," said Scott Hammond, deputy assistant attorney general.

    The investigation surfaced in 2010 when FBI agents raided the offices of Yazaki North America Inc., Denso International America Inc. and Tokai Rika Group North America.

    Regulators in the U.S., Japan and Europe have probed suppliers of wire harnesses, bearings, headlights, instrument clusters and thermal systems.

    And that investigation could spread further because of a legal tool dubbed Amnesty Plus.

    Through Amnesty Plus, the Justice Department offers leniency to suppliers who volunteer information about previously undisclosed price-fixing of other products.

    For instance, if a wire harness manufacturer reveals evidence of price-fixing for instrument clusters, it can hope for lower fines.

    "These are incredibly effective incentives for companies to conduct thorough internal investigations," Hammond said.

    The fines levied so far suggest that the Justice Department can exert considerable pressure on the suppliers. In 2011, Japanese supplier Furukawa Electric Co. was fined $200 million, and three Furukawa executives got prison terms ranging from one year to 15 months. Last August, Yazaki agreed to pay a $470 million fine, and a Yazaki executive received a 14-month prison term.

    "Individual jail sentences are the single greatest deterrent—no doubt about it,

    Hammond said.

    An executive at an automotive antivibration transplant—a company unnamed by the Justice Department but reported in the local press to be YUSA Corp.—pleaded guilty to price fixing.

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