Two GM Engineers on Paid Leave as Part of Ignition Switch Probe

GM dealership
A man walks past a row of General Motors vehicles at a Chevrolet dealership on Woodward Avenue in Detroit, Michigan April 1, 2014. Rebecca Cook/Reuters

(Reuters) - General Motors Co said it has placed two engineers on paid leave as part of an internal investigation into defective ignition switches linked to 13 deaths and the global recall this year of 2.6 million cars.

"This is an interim step as we seek the truth about what happened," GM Chief Executive Mary Barra said in a statement.(http://r.reuters.com/zan48v)

Reuters has confirmed that the engineers are Ray DeGiorgio and Gary Altman.

DeGiorgio designed the original switch for the 2003 Saturn Ion that went into production in August 2002. Versions of the same switch were used in other GM models, including the Chevrolet Cobalt, that are also part of the global recall.

CEO Barra, testifying last week before Congress, was challenged by Democratic Senator Claire McCaskill, who said "a culture of cover-up" caused DeGiorgio to deliver untruthful testimony about his knowledge of the defective ignition switch during his deposition last year for a lawsuit related to a fatal 2010 crash in Georgia.

DeGiorgio said then that the Ion/Cobalt switch was "one of my first ignition switches." The defective switch was redesigned in 2006, according to GM. DeGiorgio denied in his deposition that he knew of the change, but U.S. congressional investigators produced an internal GM document showing DeGiorgio had signed off on the change in April 2006.

"He lied" about his knowledge of the defective part, McCaskill said. Barra said she had seen indications of that as well, but she wanted to let the company probe run its course over the next two months.

Repeated attempts by Reuters to contact DeGiorgio have been unsuccessful.

Altman was the program engineering manager on the Ion and Cobalt. In a deposition in the same 2013 lawsuit, Altman was asked by the plaintiffs' attorney whether GM had made a business decision in 2005 not to fix the switch. He replied, "That is what happened, yes."

Altman did not return a phone call Thursday seeking his comment.

On Thursday, Barra said the engineers were placed on leave after she was briefed by Anton Valukas, who is heading GM's internal investigation. Valukas is the chairman of Jenner & Block. GM has worked with Jenner & Block since 2002, and at least two of the automaker's former top attorneys, Robert Osborne and Elmer Johnson, were partners at the Chicago law firm.

Some members of Congress have expressed interest in calling GM engineers, including DeGiorgio, to testify at hearings that will likely come this spring or summer.

The faulty ignition switch can be bumped from the "RUN" position to "ACCESSORY", which can cause the engine to turn off suddenly, disabling the air bags and making steering and braking more difficult.

The National Highway Traffic Safety Administration is fining GM $7,000 a day for missing an April 3 deadline to provide information about the recall.

The regulator said on Tuesday that the automaker had not responded to over a third of its questions by the deadline.

GM shares were little changed at $33.63 on Thursday morning on the New York Stock Exchange. The stock has fallen about 17 percent so far this year.

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