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Toyota is to Wall Street as NHTSA is to SEC/FINRA

Posted by Larry Doyle on February 24, 2010 6:26 AM |

In light of the Congressional hearings addressing the problems swirling around Toyota, I am reposting this commentary which was originally posted on February 12th.

When regulators are in bed with industry, bad things happen. When regulators actually go to work for the industry, then really bad things happen.

Evidence of this dynamic on Wall Street is overwhelming. Yet, don’t think that Wall Street has a monopoly on this incest. Bloomberg highlights that incestuous activity has also played out in the disaster encompassing Toyota. Bloomberg reports, Regulators Hired by Toyota Helped Halt Investigations:

Former regulators hired by Toyota Motor Corp. helped end at least four U.S. investigations of unintended acceleration by company vehicles in the last decade, warding off possible recalls, court and government records show.

Christopher Tinto, vice president of regulatory affairs in Toyota’s Washington office, and Christopher Santucci, who works for Tinto, helped persuade the National Highway Traffic Safety Administration to end probes including those of 2002-2003 Toyota Camrys and Solaras, court documents show. Both men joined Toyota directly from NHTSA, Tinto in 1994 and Santucci in 2003.

While all automakers have employees who handle NHTSA issues, Toyota may be alone among the major companies in employing former agency staffers to do so. Spokesmen for General Motors Co., Ford Motor Co., Chrysler Group LLC and Honda Motor Co. all say their companies have no ex-NHTSA people who deal with the agency on defects.

Possible links between Toyota and NHTSA may fuel mounting criticism of their handling of defects in Toyota and Lexus models tied to 19 deaths between 2004 and 2009. Three congressional committees have scheduled hearings on the recalls.

While executives from Toyota may apologize they will also look to deflect blame and minimize their own overall culpability. Think back to the bobbing and weaving and massive amount of bull s*%! we heard from Wall Street executives.

The fact is, Wall Street bought its own regulation. The allure of working in the industry had an enormous impact on regulatory efforts, or dare I say the lack thereof. That allure also served to destroy the lives of thousands. You think I embellish? Ask those who remain unable to access their cash still frozen in auction-rate securities. Ask those who lost their savings in the Madoff scam. Those situations are only the high profile cases.

Now we learn that Toyota played the same game. In this case, lives were literally lost.

How would I describe the money Toyota saved and the money these former regulators earned in the process?

Blood money!!

Are you pissed yet?

How much does America have to take before heads roll and people are truly held accountable?


  • Randy

    Frankly Larry, it will be a cold day in you know where before the elites offer us more than the necks of a few suborinates of little importance in the continuing dog and pony shows for the public. They will provide just a teensy bit of blood-letting to keep the teeming masses glued to their televisions, radios and computers, thinking that maybe, just maybe, justice will be done. It won’t. They can’t allow it.

    They will never let the great unwashed get the upper-hand and begin to actually turn the tide. They will absolutely do whatever is necessary including taking far greater control of the Internet (under the guise of doing so for our own protection somehow) if necessary.

    If the public gets too well organized and starts to gain any real clout they will be fed another panic or distraction to keep them occupied while their nascent organizations are systematically discredited and their power is either divided and usurped (the easy way) or their ability to openly communicate in any national venue is restricted or eliminated (the harder and more severe method).

    Getting back to the actual topic, extracting a pound of flesh from Toyota for efforts in cheating the system will also prove most difficult when the powers that be are deeply monetarily and psychologically invested in 11th hour attempts to rehabilitate one of Toyota’s arch competitors.

    This of course does not even consider the difficulties of taking any truly suitable punitive action against one of Japan’s top corporations now that Japan is also our largest remaining purchaser of Treasury debt. The Japanese take the loss of face very, very seriously. It is one thing to have brought dishonor on themselves, which has clearly already happened, but it is quite another to have it rubbed into their collective face in the national and international media.

    On a separate point, I do still much admire your very persistent efforts to evidence the flagrant disregard of the truth by Mary Schapiro and FINRA and their total and abject failure to carry out their mission to protect the investing public. I may miss my guess to some degree, but I strongly suspect that the very best that we will eventually see out of it is perhaps the rolling of a minor head or two while little is done to effect necessary structural change. I believe that the old ditty still holds true that “the more things change, the more they stay the same”. Let’s see what happens.

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