WASHINGTON (CNN) - Baby seat and stroller maker Graco, a unit of Newell Rubbermaid Inc., is being fined $4 million by the Consumer Product Safety Commission -- the largest civil penalty ever issued against a product manufacturer for failure to report defects and injuries related to a product, according to the commission.

In addition, the CPSC announced the recall of 1.2 million Graco toddler beds due to the danger of children getting limbs caught and broken in the slats.

The record penalty came after the CPSC said Graco failed to report possible defects on various products to the government agency for almost a decade.

"At Graco, the safety and welfare of our consumers is always our top priority," the company said. "As this settlement makes clear, it is our understanding that Graco did not knowingly violate the CPSC's reporting requirements."

The CPSC said Graco didn't report hundreds of injuries related to 16 different products. Recalls have been announced for most of those products, which include strollers, high chairs and infant carriers. In the case of a recalled infant swing, the company failed to report six deaths.

"The penalty process is just one piece of the process by which we keep families safe," said CPSC Chairman Hal Stratton. "The idea is not just to penalize, but to publicize those penalties to serve as a deterrent to those companies that might not meet safety standards or constitute substantial product hazards."

The CPSC said the 1.2 million toddler beds were sold under the names Cozy Toddler Bed, Glow in the Dark Toddler Bed and Classic Toddler Bed. The beds were sold at discount department and juvenile product stores from February 1994 through March 2001 for $50-$70.

"We haven't had any fatalities with this particular product," said Stratton. "But whenever we see broken limbs, particularly when it's in a situation where it's your bed, it's a very serious problem."

Graco said it is aware of at least 77 entrapments resulting in 13 broken arms and legs, a sprained ankle, a broken foot and 54 other injuries.

Consumers are being told to remove the guard rails and call Graco to receive a free kit to fix the problem. The kit has mesh coverings that tie to the bed and prevent entrapment.

The CPSC and Graco are finalizing some of the details of corrective action related to the penalty and will announce more recalls in the near future.

"Graco has worked diligently with the CPSC to resolve any issues with reporting and we are committed to rectifying this matter and maintaining a cooperative relationship with the CPSC," the company's statement said.

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