- the german government is pressing more charges against vw executives for their alleged roles in the diesel emissions scandal following a similar sec lawsuit in march.
- former ceo martin winterkorn, among three men named in the indictment, has already been hit with multiple criminal charges by german and u.s. authorities.
- the matter here involves stock prices and the resulting harm to investors in the wake of the initial dieselgate news in 2015.
six months after the u.s. charged volkswagen with securities fraud over its diesel emissions scandal, the german government is laying similar criminal charges against several current and former vw executives.
according to reuters, prosecutors from braunschweig on tuesday filed charges of "stock market manipulation" against former ceo martin winterkorn, current ceo herbert diess, and supervisory board chairman hans dieter poetsch. (in the photo at top, taken at the 2015 frankfurt auto show, winterkorn and diess are joined by vw r&d board member heinz-jakob neusser, at right.) the state case, spurred by a $10.5 billion lawsuit brought by vw investors in september 2018, alleges vw caused a market disruption that saw its stock price drop by more than a third shortly after the u.s. environmental protection agency announced the company's violations in september 2015.
the securities and exchange commission is going after vw for company-issued bonds that sank in value during this same time. since vw never disclosed its emissions problems to investors—a software-coded workaround to u.s. law that became a full-blown coverup allegedly directed by the company's highest leadership—both governments claim vw committed a crime by purposely distorting the market.
in response, vw said the epa "published their allegations completely unexpectedly" and "could not foresee this change in the approach of the u.s. authorities." the automaker said it assumed the epa would work privately with vw in a "mutually agreed solution" before publishing a joint public statement. since that didn't happen, vw says it didn't need to inform investors without "sufficiently concrete indications" that a violation notice was coming.
while a settlement with the sec is expected in october, this german case has only begun. the same prosecutorial office, based in vw's state of lower saxony, fined vw the equivalent of $1.1 billion in june 2018 and charged winterkorn in april with fraud and embezzlement. in july, the munich prosecutor's office charged former audi ceo rupert stadler with fraud. former porsche r&d chief wolfgang hatz, who was arrested in september 2017, is facing ongoing fraud charges in stuttgart. winterkorn and five other vw executives also face u.s. felony charges for fraud and conspiracy.
vw has paid more than $30 billion in criminal and civil fines, penalties, vehicle buybacks, and more charges as a result of the emissions scandal.