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GM to start taking recall compensation claims August 1

General Motors is set to begin processing compensation claims from victims of poorly designed ignitions linked to 13 deaths, GM chief executive Mary Barra said.

WASHINGTON: General Motors (GM) is set to begin processing compensation claims from victims of poorly designed ignitions linked to 13 deaths, GM chief executive Mary Barra said on Tuesday.

Barra, who returns to Congress on Wednesday for another grilling on the faulty ignition recall scandal, said in prepared testimony the US automaker was making swift progress in setting up the compensation fund.

Attorney Kenneth Feinberg, the disaster response expert in charge of establishing the fund, was expected to provide the criteria for victims and compensations levels by the end of June, she said.

"We also expect to begin processing claims by August 1," Barra said in testimony to be delivered to the House of Representatives oversight panel.

GM is facing multiple lawsuits for the ignition-switch problem, which analysts say could ultimately cost the company billions of dollars in damages.

The company says it knows of 54 ignition-related accidents and 13 deaths since 2004. The National Highway Traffic Safety Administration says the death toll could be higher.

The company has recalled 20 million cars overall since the start of the year, including about six million for ignition-switch problems, the latest Monday's recall of 3.4 million cars.

GM has set aside US$2.0 billion to cover recall-related costs in the first half of the year.

Barra, who last appeared before the House panel on April 1, will be updating lawmakers on an internal GM report published on June 5 that absolved top management in the failure to recall millions of cars for more than a decade after the problems with the ignition switches were discovered.

But the report, prepared by former US attorney Anton Valukas, found a "deeply troubling" history of "incompetence and neglect" at the largest US automaker.

Valukas is also scheduled to testify at the House hearing on Wednesday.

Barra, a GM veteran, took the company's top job just weeks before the first ignition-switch recall in early February.

She insisted to lawmakers that the company is making progress in implementing the recommendations of the Valukas report to improve vehicle safety.

"I know some of you are wondering about my commitment to solve the deep underlying cultural problems uncovered in this report. The answer is I will not rest until these problems are resolved," she said.

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