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Toyota Motor Corp has agreed to pay a record $16.4 million fine
to U.S. safety regulators in response to the government’s claim that it
knowingly delayed a massive accelerator pedal recall in January, a government
official said.

The settlement between the U.S. Department of Transportation and
the world’s largest automaker is expected to be signed on Monday in Washington,
the official said.

The Obama administration determined that Toyota knowingly
delayed a recall for a potentially dangerous mechanical glitch that could cause
accelerator pedals on some of its best-selling models, including the Camry, to
become stuck.

By agreeing to pay the $16.4 million fine, Toyota is “accepting
responsibility for hiding this safety defect” from the National Highway Traffic
Safety Administration “in violation of the law,” the senior Transportation
Department official told Reuters.

The official asked not to be named because the settlement with
Toyota had not been finalized.

A Toyota spokesman in Japan said that the automaker had not made
a final determination on how it would respond to the proposed fine from U.S.
officials.

A settlement of the Department of Transportation fine marks the
end of one chapter in a safety crisis that has tarnished Toyota’s reputation
and forced it to compete aggressively on pricing to win back sales in the U.S.
market.

But Toyota still faces over 100 lawsuits alleging consumer fraud
and personal injuries over unintended acceleration in its vehicles.

In addition, U.S. safety regulators are continuing their investigation
of Toyota and have not ruled out further action, the official said.

In a further embarrassment, Toyota has been forced to shut down
production of the Lexus GX 460 SUV over a problem with its electronic control
system and now faces a decision on whether to recall the vehicle.

Shares of Toyota were down almost 2 percent in early afternoon
trade in Tokyo.

Monday marks the end of a two-week period in which Toyota had to
either agree to pay the fine or to file an appeal.

Further liability

Toyota’s decision to pay the fine will not release it from
potential liability in lawsuits over unintended acceleration in Toyota and
Lexus vehicles, the U.S. official said.

Some lawyers estimate Toyota faces potential civil liability of
more than $10 billion in U.S. courts as it struggles to contain an auto-safety
crisis that has tarnished its public image.

The recent addition of demands for full refunds to U.S. owners
of recalled Toyota vehicles as part of consumer protection cases filed in 12
states could raise the legal stakes even higher for the car company, lawyers
say.

On Friday, Toyota’s U.S. representatives said they had confirmed
the results of a Consumer Reports test revealing a handling problem in the
Lexus GX 460.

In addition, the U.S. House Energy and Commerce committee
scheduled a May 6 hearing and asked that Toyota’s U.S. sales chief Jim Lentz to
testify. Lentz appeared before the same panel in February.

Lawmakers are seeking more information about the automaker’s
review of its electronic throttle controls and its work with an outside
consultant to review its related safety systems.