Whistleblower Paid $24 Million For Exposing Hyundai-Kia Engine Delays

Industry News / Comments

A payment like this has never happened before.

Nearly one year ago, Hyundai and Kia, under the umbrella of the Hyundai Motor Group, agreed to a $210 million total settlement with the US government. They inaccurately reported information regarding a major engine recall affecting 1.5 million vehicles in the US, Canada, and South Korea. Some 1.19 million units were in the US alone, including the 2011-2014 Hyundai Sonata and Kia Optima, the 2013-2014 Santa Fe, 2012-2014 Sorento, and the 2013-2014 Sportage.

The feds were alerted to that inaccuracy by a company whistleblower, and now that anonymous individual is being handsomely rewarded. The Associated Press reports this person is being paid $24 million, the maximum percentage of the fine the law allows for.

Kia
Kia

The problem with the Theta II 2.4- and 2.0-liter engines involved machining errors during the manufacturing process. This lead to "premature bearing wear within the engine," according to the National Highway Traffic Safety Administration (NHTSA) official report. The engines could potentially freeze up or even catch on fire.

"This information is critical to public safety, and we are committed to rewarding those who bring information to us," Deputy NHTSA Administrator Steven Cliff said. The law states the NHTSA can award up to 30 percent of collected penalties to a whistleblower, but only if that individual provides relevant information that results in penalties in excess of $1 million.

Hyundai
Hyundai
Hyundai
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The agency first opened a probe back in 2017 following a Hyundai recall of 470,000 engines in the fall of 2015. The repairs were extensive. Hyundai had to replace the engine block in every vehicle, which naturally caught the agency's attention. But it was the whistleblower who helped expose that Hyundai initially limited the number of recalled vehicles as it claimed to have fixed the problem. Kia also stalled in issuing a recall.

Over a year and a half following the first recall, Hyundai announced a further recall for 1.2 million more vehicles with the same issue. Some of the affected models weren't included in the earlier recall. It was because of these potentially dangerous and deadly recall delays the whistleblower decided to knock on the feds' door. Both Hyundai and Kia have taken measures to guarantee something like this never happens again.

Kia
Kia
Hyundai
Source Credits: Associated Press

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