Toyota Subsidiary Hit With Over $1.6 Billion in Penalties for Emissions Fraud Scheme

Key Takeaways

• $1.6B in Penalties: Hino Motors Ltd., a Toyota subsidiary, was sentenced to pay over $1.6 billion in criminal fines and forfeitures after pleading guilty to a multi-year emissions fraud scheme.
• False Emissions Data: Between 2010 and 2019, Hino engineers falsified emissions test data and failed to disclose software that negatively impacted the engines' emissions systems, affecting over 105,000 engines.
• Five-Year Probation: As part of the sentence, Hino Motors is prohibited from importing diesel engines into the U.S. for five years and must implement a comprehensive compliance and ethics program.

Deep Dive

Hino Motors Ltd., a subsidiary of Toyota, has been sentenced to pay over $1.6 billion in penalties for its role in a widespread emissions fraud scheme. This sentencing, handed down today by U.S. District Court Judge Mark A. Goldsmith, comes after Hino Motors pleaded guilty to submitting false emissions data, deceiving both U.S. regulators and consumers over the course of nearly a decade.

Hino’s fraudulent actions weren’t just a minor slip-up. They involved submitting fake applications for engine certification and intentionally altering test data to make their engines appear cleaner than they actually were. Between 2010 and 2019, engineers at the company rigged emission tests and fabricated carbon dioxide data—affecting over 105,000 engines in the process. These engines, primarily found in heavy-duty trucks, were sold across the U.S. under the false pretense that they met strict environmental standards.

It’s a big deal. We’re talking about a company that bent the rules to the tune of over $1 billion in illicit profits, putting its bottom line above environmental responsibility and fairness to other companies that were playing by the book.

“Hino’s criminal conduct gave it an unfair business advantage over other law-abiding companies, including American companies,” said Acting Assistant Attorney General Adam Gustafson. “This wasn’t just about defrauding the government—it was about misleading consumers, damaging the environment, and violating public trust.”

As part of the ruling, Hino Motors has been hit with a hefty fine of $521.76 million. That’s just the beginning. The company has also been slapped with a $1.087 billion forfeiture money judgment. Judge Goldsmith further imposed a five-year probation period, during which Hino will be prohibited from importing any diesel engines into the U.S. This is a major hit to a company that, for years, had been passing off subpar, pollutant engines as compliant.

The court’s actions are part of the government’s ongoing efforts to hold corporate actors accountable when they attempt to sidestep regulations for profit. “Hino falsely certified compliance with the Clean Air Act so that it could profit off Americans by sending illegal, polluting engines into the United States,” said Acting Assistant Administrator Jeffrey Hall for EPA’s Office of Enforcement and Compliance Assurance. “Today’s plea and sentencing demonstrates that companies who intentionally evade our nation’s environmental laws, including by fabricating data to feign compliance with those laws, deserve punishment and will be held criminally accountable.”

In addition to the penalties, Hino Motors must implement a comprehensive compliance and ethics program to ensure it doesn’t repeat its past mistakes. They’ll need to set up a reporting structure and work closely with regulators to make sure their operations are transparent and above board.

Acting U.S. Attorney Julie Beck summed it up, “Our office is committed to holding corporations accountable when they deceive the government and exploit American consumers. Hino Motors thought they could cheat the system—and now they’re paying the price.”

This case was no simple matter. It took years of investigation by the EPA’s Criminal Investigation Division and the FBI’s Detroit Field Office to uncover the full scale of the fraud. And while Hino’s guilty plea closes the chapter on this particular case, it’s far from the end of the story. As Acting Assistant Director James C. Barnacle Jr. from the FBI’s Criminal Investigative Division pointed out, “It doesn’t matter how complex the scheme is—the FBI is committed to holding individuals and organizations responsible for their actions.”

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