As if Toyota Motor Corp. hasn't had enough trouble, the automaker is now facing a new set of interrogators: federal and local law enforcement officials.
The FBI, the U.S. attorney for the Southern District of New York, the Securities and Exchange Commission -- and even the Los Angeles city attorney -- are all conducting probes into the Japanese automaker. That's on top of investigations from federal regulators, Congress and the news media over Toyota's sudden-acceleration problems.
For Toyota, the scrutiny from law enforcement adds another degree of difficulty to its attempt to rebuild its reputation and sales after issuing more than 10 million recall notices worldwide in recent months.
"Any time a major corporation is faced with issues of Toyota's nature, there are significant problems," said Aubrey Harwell Jr., a Nashville attorney who helped defend Ford Motor Co. against criminal charges in 1980 that arose from its Pinto gas tanks. "The media can become very aggressive. Lawyers tend to bring suits. Congressional hearings take place. There may be a criminal investigation. But most important, the time and focus of management is diverted from running the company to managing the problems."
As they dig into Toyota's handling of sudden-acceleration problems, law enforcement investigators are likely to focus on whether the company fully disclosed safety problems in its vehicles and whether it abided by securities laws requiring it to warn investors about potential problems, legal experts say.
The experts also note that the probes could go into unanticipated directions, including the company's competitive practices and even its advertising claims.
The company could be vulnerable to charges including wire fraud and racketeering, said Jeffrey Isaacs, deputy chief of the special operations and litigation division for the Los Angeles city attorney's office and a former federal prosecutor.
"So much incriminating information is coming out," said Isaacs, whose office opened a criminal investigation this month.
The Justice Department has neither confirmed nor denied that it is investigating Toyota. But Toyota's parent corporation in Japan and its Torrance-based sales operation have confirmed that probes are underway and have said that they "intend to cooperate with the investigations and are currently preparing their responses."
President Akio Toyoda has acknowledged that the company has made mistakes as it pushed to expand, and has pledged to make safety and reliability a higher priority.
The biggest potential liability for Toyota would arise if investigators determine that the company knowingly concealed a defect or safety problem from federal safety regulators, said Joan Claybrook, an attorney and former head of the National Highway Traffic Safety Administration. That would be a federal crime under an umbrella federal statute that covers fraud and false statements, she said.
The company could also be charged under the TREAD Act, a motor vehicle safety law enacted in the aftermath of the recalls issued for Firestone tires, related to a series of fatal rollover crashes of Ford Explorer sport utility vehicles, Claybrook said.
Although many U.S. corporations have faced federal criminal indictments, particularly defense contractors and financial institutions, a criminal case against a consumer product company over public safety matters could be more serious.
Criminal charges against automakers, particularly on safety issues, are rare. The most notable one was the homicide case brought against Ford by Indiana prosecutors involving the Pinto gas tank that was vulnerable to exploding in rear-end collisions. Ford was acquitted.
Allan J. Kam, a former senior enforcement attorney at NHTSA until 2000, said that in his 25 years at the agency he never even saw a single referral to the Justice Department for potential criminal violations.
"I really don't think that's been on NHTSA's radar screen," he said. "We weren't geared up to read people their Miranda rights. Criminal issues are just a different field."
Though rare, criminal investigations into safety issues are not unheard of for automakers. In the mid- 1980s, General Motors was the subject of a Justice Department investigation of allegations that it lied about brake problems in its X-car line. The company faced civil charges, but it was never indicted.
And in 2003, a federal grand jury in Illinois heard evidence regarding Ford and Bridgestone/Firestone's involvement in tire failure and rollover accidents, but no indictment was returned.
Toyota said it received a subpoena from a federal grand jury in New York in February that asked for "certain documents related to unintended acceleration of Toyota vehicles and the braking system of the Prius."
The company also acknowledged getting another subpoena from the Los Angeles offices of the SEC, relating to unintended acceleration and "the company's disclosure policies and practices." NHTSA is separately conducting a civil investigation into the same issue and has the ability to levy civil fines.
The very existence of the federal investigations is likely to bring would-be witnesses out of the woodwork. A least one former Toyota engineer said he had provided documents to the FBI.
Claybrook said proving allegations that any automaker withheld safety information from NHTSA could be tough. Federal safety regulators allowed Toyota to sharply narrow the scope of its definition of sudden acceleration during the course of several safety probes in the last eight years, which could give the automaker a legal shield, Claybrook said.
Apart from sudden acceleration, Toyota could also figure in a federal antitrust investigation. On Feb. 23, the FBI raided three Toyota suppliers in Michigan -- Denso Corp., Yazaki North America and Tokai Rika. At the time, the Justice Department said only that its antitrust division was looking into the possibility of anti-competitive cartel conduct.
Meanwhile, the Los Angeles city attorney has opened a criminal investigation, Isaacs said. The city has a fleet of about 750 Toyota vehicles, among the largest municipal fleets in the country, and broad jurisdiction to bring consumer protection suits, Isaacs said.
"There appears to be a pattern of reckless disregard or evidence of concealment in the past," said Isaacs, a former federal prosecutor.
Isaacs said the city would examine whether Toyota or its dealers provided false assurances to consumers about the safety of Toyota vehicles, which could be either a civil or a misdemeanor criminal violation.
Kam, the former NHTSA attorney, said that if Toyota's only wrongdoing was a failure to make timely recalls, it would face a civil penalty of as much as $16.4 million.
"It's a drop in the bucket compared to what a recall might cost," said Kam, who now runs a regulatory consulting firm in Maryland. "However, the equation changes completely when executives say, 'Hold on, I may go to jail.' "