Vehicle ran through a stop sign at a T-junction, killing all 18 people inside the limo and two pedestrians

The stretch limousine involved in an accident that killed 20 people in upstate New York on Saturday, including two pedestrians and all those riding inside, had recently failed a vehicle inspection and should not have been on the road, according to New York governor Andrew Cuomo.

“The owner of the company had no business putting a failed vehicle on the road,” Cuomo said on Monday, speaking to reporters.

Cuomo also said the driver of the vehicle, who has not been identified and was killed along with all the passengers, did not have the specific license – a commercial driver’s license with a passenger endorsement – required to drive the limousine.

The crash involving the limousine, which was taking people to a birthday party, occurred near an upstate New York tourist spot, about 40 miles west of the state capital Albany. The vehicle ran through a stop sign at a junction at the bottom of a hill.

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All 18 people inside the limo – 17 passengers and a driver – were killed in the collision with a parked, empty car, and two pedestrians also died after being hit.

Local officials told the Times Union of Albany that a limo speeding down a hill hit bystanders Saturday afternoon outside the Apple Barrel Country Store in Schoharie, about 170 miles north of New York City, the paper reported.

An aunt of one of the victims said a recently wed couple were among those killed. Valerie Abeling identified the two victims as Erin Vertucci, 34, and Shane McGowan, 30. Abeling said of the wider family: “Our lives have been changed forever.” Four sisters were among the dead, as the group of local relatives and friends headed to the 30th birthday celebrations of one of the sisters, according to local reports on Monday.

Facebook Twitter Pinterest Friends of victims who died in Saturday’s fatal limousine crash comfort each other after placing flowers at the intersection in Schoharie, New York. Photograph: Hans Pennink/AP

It has not yet been established whether a driving or a mechanical problem led to the crash. The National Transportation Safety Board is investigating. The limousine was in substandard condition and had been called to replace a party bus the group had originally intended to travel in, which had broken down, according to the New York Times.

Prestige Limousine, the local company responsible for the vehicle, was being sent a “cease and desist” notice to suspend operations until the investigation is complete, Cuomo said.

State police first deputy superintendent Christopher Fiore said at a news conference in Latham, New York, on Sunday that the limo had failed to stop at a T-junction.

The crash “sounded like an explosion”, said Linda Riley, of nearby Schenectady, who was on a shopping trip with her sisters and had been in their parked car at the time at the store. When she got out of her vehicle, she saw a body on the ground, she said.

A wide swath of scoured grass could be seen next to a notorious intersection, leading to a small ravine that on Sunday was still showered with crash debris, close to where the limo had gone off the road.

The country store is a popular stop for tourists on fall foliage trips and the parking lot was busy at the time, eyewitnesses told the New York Times, especially as it was a Saturday on a holiday weekend, before Columbus Day on Monday.

Customers in the parking lot were killed when they were hit by the limo coming down a hill on state Route 30 at “probably over 60 mph”, the store manager, Jessica Kirby, said.