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Former FBI Director Mueller Out as Takata Victim Fund Chief

Expected to be replaced by compensation fund specialist Feinberg.

by on Jun.06, 2017

Former FBI Director Robert Mueller was overseeing the $1 billion Takata victims fund, but is now in charge of a Justice Department probe.

The escalating probe of possible Russian meddling in the 2017 presidential election is now interfering with plans to compensate victims of Takata’s faulty airbags.

Former FBI Director Robert Mueller, who had been named earlier this year to handle claims of more than $1 billion as part of a settlement with the U.S. government is stepping down in order to lead the Justice Department probe of alleged hacking and the possibility of collusion by then-candidate Donald Trump’s campaign team.

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Mueller is expected to be replaced by Kenneth Feinberg – who many originally expected to be named by U.S. District Judge George Caram Steeh to oversee the Takata victims’ fund. Feinberg has become one of the nation’s leading specialists in such efforts, previously having overseen payouts to victims of the 9/11 attacks, the BP Gulf oil spill and a fund set up by General Motors to compensate victims and families as a result of its deadly ignition switch defect.

The highly regarded Mueller served as the sixth FBI director between 2001 and 2013. He agreed last month to resign from his law firm and serve as head of a special investigation set up by Assistant Attorney General Rode Rosenstein. That probe had been actively sought by many Democrats and others concerned about possible Russian hacking and collusion.

(Takata airbag recall effort sputtering. Click Here for the story.)

“Bob Mueller took an extraordinary monetary loss to drop this assignment and willingly gave up fees that would have amounted to millions of dollars to accept the Justice Department’s Special Counsel appointment,” Steeh said in a statement.

Officially, the court is expected to spend several weeks considering other candidates to now handle the Takata fund, though news reports suggest Feinberg has a lead on the job.

Kenneth Feinberg was initially expected to oversee the Takata fund and is now expected to take over in the wake of Mueller's departure.

The 71-year-old Massachusetts native has earned a solid reputation for his work with other victims’ compensation funds, most recently one set up on the orders of GM Chairman and CEO Mary Barra. The automaker paid out nearly $700 million after it was revealed it had covered up for more than a decade an ignition switch defect blamed for over 100 deaths.

In the case of Takata, the Japanese automotive supplier acknowledged that it similarly taken steps to conceal faulty airbag inflators currently blamed for at least 16 deaths – most of those in the United States – as well as more than 180 injuries.

Four automakers settle Takata airbag suit for $553 million. Click Here for the details.)

The problem has triggered the largest recall in automotive history, impacting about 100 million airbags produced by Takata. Because some vehicles used multiple airbags, the precise number of them affected is uncertain but is expected to ultimately run in excess of 50 million in the U.S. alone.

A total of 19 different manufacturers have been forced to order recalls, from small brands like Ferrari to Japanese giant Toyata. Honda had the broadest relationship with Takata and has the most vehicles covered by the service actions that began in 2008 when the defect started to become apparent.

As part of the settlement with the Justice Department, Takata agreed to pay a $25 million criminal fine, $125 million in victim compensation and $850 million to compensate automakers for their expenses related to their recalls.

As reported last week, there has been trouble getting all of those covered by the recall repaired, in part due to their age and the difficulty of finding owners after multiple sales. There has also been a shortage of replacement parts.

(Takata pleads guilty, setting up victims fund. Click Here for the story.)

That worries experts who note that evidence indicates that as they age, Takata airbags become more prone to misfire when triggered by a crash.

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