The U.S. Justice Department, Environmental Protection Agency (EPA), FBI, Customs and Border Protection (CBP), Department of Transportation’s Office of Inspector General (DOT-OIG), National Highway Traffic Safety Administration (NHTSA), and State of California reached criminal and multiple civil resolutions, valued at more than $1.6 billion, with Hino Motors Ltd., Hino Motors Manufacturing U.S.A., Inc. and Hino Motors Sales U.S.A., Inc. (collectively, Hino) for violations related to the submission of false and fraudulent engine emission testing and fuel consumption data to regulators and the illicit smuggling of engines into the United States. These resolutions are subject to approval by the U.S. District Court for the Eastern District of Michigan.
“Hino knew the requirements that engines must meet to be certified to operate in the United States, yet it falsified data for years to skirt regulations,” Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division (ENRD) said yesterday. “Hino’s actions led to vast amounts of excess air pollution and were an egregious violation of our nation’s environmental, consumer protection and import laws.”
Global Resolution
As part of the global resolutions, Hino Motors, Ltd. has agreed to plead guilty to engaging in a multi-year criminal conspiracy. The plea agreement, which is subject to approval by the court, requires it to pay a criminal fine of $521.76 million, serve a five-year term of probation – during which it will be prohibited from importing any diesel engines it has manufactured into the United States – and implement a comprehensive compliance and ethics program and reporting structure. Hino Motors, Ltd. has also agreed to entry of a forfeiture money judgment against it in the amount of $1.087 billion. Pursuant to the plea agreement, Hino’s future payments towards its civil settlement obligations, as well future payments as part of a civil class action settlement brought by private plaintiffs, will be credited towards its criminal forfeiture money judgment obligation.
In separate civil resolutions of environmental, customs and fuel economy claims by the federal government and the State of California, Hino will pay a civil penalty of $525 million based on its demonstrated financial condition. The global resolution includes the second largest criminal fine and fourth largest civil penalty in the history of EPA’s mobile source program.
Other provisions of the civil agreement include:
- A mitigation program, valued at $155 million, to offset excess air emissions from the violations by replacing marine and locomotive engines, and installing locomotive idle reduction technology systems, throughout 49 states (excluding California), including the reduction of over 41,000 tons of nitrogen oxides (NOx) emissions;
- A recall program, valued at $144.2 million, to modify violative engines in 2017-2019 heavy-duty trucks so they comply with U.S. and California emissions laws;
- $123.6 million to fund mitigation projects and enforcement costs in California; and
- $30.3 million to resolve California False Claims Act claims.
EPA discovered Hino’s noncompliance as a result of conducting confirmatory testing of Hino’s engines. On Jan. 10, EPA voided engine approvals, called “certificates of conformity,” for Hino’s 2010-2019 diesel engines for heavy-duty trucks and nonroad equipment. This is the largest voiding action ever taken by EPA, reflecting the egregiousness of the conduct and the flagrant disregard for EPA’s certification program. That program is designed to provide a level playing field for vehicle and engine manufacturers seeking to do business in the United States.
Conduct Admitted to by Hino Motors
As part of its plea agreement, Hino Motors, Ltd. admits that between 2010 and 2019, it submitted and caused to be submitted false applications for engine certification approvals. Hino Motors, Ltd. engineers regularly altered emission test data, conducted tests improperly and fabricated data without conducting any underlying tests. Hino Motors, Ltd. further admits that it submitted fraudulent carbon dioxide emissions test data, which resulted in false fuel consumption values being calculated for its engines. Hino Motors, Ltd. engineers also failed to disclose software functions that could adversely affect engines’ emission control systems. As a result of the fraud, Hino Motors, Ltd. imported and sold over 105,000 non-conforming engines between 2010 and 2022.
Emissions Reductions
EPA estimates that Hino’s engines emitted levels of NOx, particulate matter, carbon dioxide (CO2), and nitrous oxide (N2O) above the regulatory limits. Hino’s recall is designed to bring model year 2017-2019 truck engines into compliance with emissions standards. Its mitigation projects around the country will fully offset the lifetime excess emissions of all violative engines. These mitigation projects include:
- Replacing more than 35 older, dirtier marine and locomotive engines with engines certified to the strictest EPA diesel emission standards, and
- Installing idle reduction technology in over 135 locomotives.
The mitigation projects will reduce emissions by at least 41,941 tons of NOx, 376 tons of particulate matter, 6,199 tons of CO2, and 135 tons of N2O. The NOx reductions alone are estimated to be equivalent to removing over 110,000 heavy-duty trucks from operation.
NOx and particulate matter are associated with serious health effects, including asthma attacks, respiratory illnesses and cardiovascular issues, which can lead to lung damage and premature death. CO2 and N2O are climate-impacting greenhouse gases, which can also endanger public health and welfare.
The Clean Air Act requires vehicle and engine manufacturers to submit testing data showing that their products meet air pollution emission standards in order to obtain certifications from EPA and California. As part of the certification process, manufacturers must conduct emission testing and submit test data demonstrating compliance with standards. Manufacturers must also disclose software functions that could affect engines’ emission controls. Further, motor vehicle engines must comply with emissions requirements to be lawfully imported into the United States. NHTSA regulations require that manufacturers like Hino provide fuel consumption values for each model year because these standards are designed to conserve fuel and increase efficiency.
The charges in the criminal information filed against Hino Motors are merely accusations. All defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law. A plea hearing date has not yet been set. Individuals can contact the Justice Department regarding victim rights and services or the status of this case at (833) 676-181 or at crimevictimprogram.enrd@usdoj.gov; please mention or put in the subject line: 198-01902. The Justice Department uses the Victim Notification System (VNS) to provide victims with case information and updates related to this case. If you believe you are a victim of the conduct described in the plea agreement and criminal information, please visit www.justice.gov/enrd/case/hino-motors-ltd.
The proposed global civil settlement consent decree is subject to a 30-day comment period and final court approval. More information on the consent decree and the process for submitting comments is available at www.justice.gov/enrd/consent-decrees. This settlement agreement is part of a coordinated group of settlements resolved by the United States against Hino by EPA, NHTSA, CBP, and California with resolved False Claims Act and other state-only claims on behalf of the California Air Resources Board (CARB) and the California Attorney General. Special agents of EPA’s Criminal Investigation Division (EPA-CID)’s Ann Arbor Field Office and FBI’s Detroit Field Office are investigating the criminal case.
Toyota’s Hino Motors Emissions Fraud – $1.6B Plea Deal
The U.S. Justice Department, Environmental Protection Agency (EPA), FBI, Customs and Border Protection (CBP), Department of Transportation’s Office of Inspector General (DOT-OIG), National Highway Traffic Safety Administration (NHTSA), and State of California reached criminal and multiple civil resolutions, valued at more than $1.6 billion, with Hino Motors Ltd., Hino Motors Manufacturing U.S.A., Inc. and Hino Motors Sales U.S.A., Inc. (collectively, Hino) for violations related to the submission of false and fraudulent engine emission testing and fuel consumption data to regulators and the illicit smuggling of engines into the United States. These resolutions are subject to approval by the U.S. District Court for the Eastern District of Michigan.
“Hino knew the requirements that engines must meet to be certified to operate in the United States, yet it falsified data for years to skirt regulations,” Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division (ENRD) said yesterday. “Hino’s actions led to vast amounts of excess air pollution and were an egregious violation of our nation’s environmental, consumer protection and import laws.”
Global Resolution
As part of the global resolutions, Hino Motors, Ltd. has agreed to plead guilty to engaging in a multi-year criminal conspiracy. The plea agreement, which is subject to approval by the court, requires it to pay a criminal fine of $521.76 million, serve a five-year term of probation – during which it will be prohibited from importing any diesel engines it has manufactured into the United States – and implement a comprehensive compliance and ethics program and reporting structure. Hino Motors, Ltd. has also agreed to entry of a forfeiture money judgment against it in the amount of $1.087 billion. Pursuant to the plea agreement, Hino’s future payments towards its civil settlement obligations, as well future payments as part of a civil class action settlement brought by private plaintiffs, will be credited towards its criminal forfeiture money judgment obligation.
In separate civil resolutions of environmental, customs and fuel economy claims by the federal government and the State of California, Hino will pay a civil penalty of $525 million based on its demonstrated financial condition. The global resolution includes the second largest criminal fine and fourth largest civil penalty in the history of EPA’s mobile source program.
Other provisions of the civil agreement include:
EPA discovered Hino’s noncompliance as a result of conducting confirmatory testing of Hino’s engines. On Jan. 10, EPA voided engine approvals, called “certificates of conformity,” for Hino’s 2010-2019 diesel engines for heavy-duty trucks and nonroad equipment. This is the largest voiding action ever taken by EPA, reflecting the egregiousness of the conduct and the flagrant disregard for EPA’s certification program. That program is designed to provide a level playing field for vehicle and engine manufacturers seeking to do business in the United States.
Conduct Admitted to by Hino Motors
As part of its plea agreement, Hino Motors, Ltd. admits that between 2010 and 2019, it submitted and caused to be submitted false applications for engine certification approvals. Hino Motors, Ltd. engineers regularly altered emission test data, conducted tests improperly and fabricated data without conducting any underlying tests. Hino Motors, Ltd. further admits that it submitted fraudulent carbon dioxide emissions test data, which resulted in false fuel consumption values being calculated for its engines. Hino Motors, Ltd. engineers also failed to disclose software functions that could adversely affect engines’ emission control systems. As a result of the fraud, Hino Motors, Ltd. imported and sold over 105,000 non-conforming engines between 2010 and 2022.
Emissions Reductions
EPA estimates that Hino’s engines emitted levels of NOx, particulate matter, carbon dioxide (CO2), and nitrous oxide (N2O) above the regulatory limits. Hino’s recall is designed to bring model year 2017-2019 truck engines into compliance with emissions standards. Its mitigation projects around the country will fully offset the lifetime excess emissions of all violative engines. These mitigation projects include:
The mitigation projects will reduce emissions by at least 41,941 tons of NOx, 376 tons of particulate matter, 6,199 tons of CO2, and 135 tons of N2O. The NOx reductions alone are estimated to be equivalent to removing over 110,000 heavy-duty trucks from operation.
NOx and particulate matter are associated with serious health effects, including asthma attacks, respiratory illnesses and cardiovascular issues, which can lead to lung damage and premature death. CO2 and N2O are climate-impacting greenhouse gases, which can also endanger public health and welfare.
The Clean Air Act requires vehicle and engine manufacturers to submit testing data showing that their products meet air pollution emission standards in order to obtain certifications from EPA and California. As part of the certification process, manufacturers must conduct emission testing and submit test data demonstrating compliance with standards. Manufacturers must also disclose software functions that could affect engines’ emission controls. Further, motor vehicle engines must comply with emissions requirements to be lawfully imported into the United States. NHTSA regulations require that manufacturers like Hino provide fuel consumption values for each model year because these standards are designed to conserve fuel and increase efficiency.
The charges in the criminal information filed against Hino Motors are merely accusations. All defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law. A plea hearing date has not yet been set. Individuals can contact the Justice Department regarding victim rights and services or the status of this case at (833) 676-181 or at crimevictimprogram.enrd@usdoj.gov; please mention or put in the subject line: 198-01902. The Justice Department uses the Victim Notification System (VNS) to provide victims with case information and updates related to this case. If you believe you are a victim of the conduct described in the plea agreement and criminal information, please visit www.justice.gov/enrd/case/hino-motors-ltd.
The proposed global civil settlement consent decree is subject to a 30-day comment period and final court approval. More information on the consent decree and the process for submitting comments is available at www.justice.gov/enrd/consent-decrees. This settlement agreement is part of a coordinated group of settlements resolved by the United States against Hino by EPA, NHTSA, CBP, and California with resolved False Claims Act and other state-only claims on behalf of the California Air Resources Board (CARB) and the California Attorney General. Special agents of EPA’s Criminal Investigation Division (EPA-CID)’s Ann Arbor Field Office and FBI’s Detroit Field Office are investigating the criminal case.