Cruise Admits to False Reporting and Faces Penalties

By David Shepardson

(Reuters) – General Motors' self-driving car unit, Cruise, has admitted to submitting a false report that was intended to influence a federal investigation. As a consequence, the company will pay a $500,000 criminal fine as part of a deferred prosecution agreement, according to the Justice Department.

The department revealed that Cruise failed to disclose crucial details about an October 2023 crash in which one of its robotaxis struck a pedestrian in San Francisco. The pedestrian had already been hit by another vehicle and was dragged 20 feet (6.1 meters).

"Companies with self-driving cars that seek to share our roads and crosswalks must be fully truthful in their reports to their regulators," emphasized Martha Boersch, who heads the criminal division for the U.S. Attorney's Office in San Francisco.

Under the three-year agreement, Cruise is required to cooperate with government investigations, implement a safety compliance program, and provide annual reports to the U.S. Attorney's Office. If Cruise fails to comply in the next three years, prosecution of the charged offense can proceed.

Cruise President Craig Glidden stated, "Cruise will comply with the requirements set forth in the agreement, as we continue to move forward under new leadership and with a firm commitment to transparency with our regulators."

Following the accident and subsequent investigations, both the CEO and co-founder of Cruise resigned. The company also reduced its workforce by 25% and fired nine executives, including the chief operating officer and the chief legal and policy officer.

The Cruise robotaxi stopped after running over the pedestrian but attempted to pull over to the side with the woman underneath, dragging her and causing serious injuries. Cruise's report to NHTSA did not mention the dragging incident. General Motors later reached an $8 million settlement with the woman involved.

In September, Cruise had agreed to a $1.5 million fine to resolve another NHTSA investigation. Additionally, Cruise must present a corrective action plan to improve compliance regarding the reporting of serious incidents and will face enhanced reporting requirements for at least two years.

NHTSA is still investigating whether Cruise is taking adequate measures with its autonomous robotaxis to protect pedestrians. In August, Cruise recalled 1,200 of its robotaxis due to hard braking issues.

The company also faces an investigation from the Securities and Exchange Commission.

Cruise has resumed supervised autonomous driving tests in three U.S. cities but has abandoned its Origin vehicle that lacks human controls. In August, the company announced it would introduce its autonomous vehicles on the ride-hailing platform Uber (NYSE:UBER) starting next year.