The U.S. Department of Transportation's National Highway Traffic Safety Administration (NHTSA) has imposed a $3.5 million penalty on Italian luxury car maker Ferrari for failing to submit early warning reports that indicate safety issues.

The NHTSA said that Ferrari admitted to wrongdoing in its failure to submit EWR reports over a period of three years. The company was also said to have neglected reporting three fatal incidents.

"The information included in early warning reports is an essential tool in tracking down dangerous defects in vehicles," said David Friedman, the NHTSA's deputy administrator. "Early warning reports are like NHTSA's radar, helping us to find unsafe vehicles and make sure they are fixed. Companies that violate the law and fail to comply will be subject to comparable swift NHTSA enforcement action."

Under federal law, large automobile manufacturers and their affiliates are required to submit EWR reports every quarter. Ferrari became subject to this requirement when its parent company Fiat acquired Chrysler in 2011.

Before the merger, Ferrari was not required to file EWR reports since it was considered a small volume manufacturer. While the company was earlier exempt from submitting EWR reports, it was always required to report fatal incidents.

According to the NHTSA, Ferrari will be required to comply with oversight requirements. The company will also be required to improve its processes in relation to EWR reporting, train employees to comply with EWR requirements and submit all the reports that it neglected to provide authorities over the past three years.

"There is no excuse for failing to follow laws created to keep drivers safe, and our aggressive enforcement action today underscores the point that all automakers will be held accountable if they fail to do their part in our mission to keep Americans safe on the road," said transportation secretary Anthony Foxx.

The penalty comes days after Fiat Chrysler Automobiles (FCA) announced plans to spin off the Ferrari brand. FCA said that Ferrari shares will be listed in the U.S. and possibly also in Europe. A 10% stake in Ferrari will be listed on the stock market. The remaining 90% will be split between Fiat Chrysler shareholders.

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