Former Volkswagen CEO Charged With Fraud in Dieselgate Case

Former Volkswagen CEO Charged With Fraud in Dieselgate Case

German prosecutors have charged former Volkswagen boss Martin Winterkorn over his role in the diesel emissions scandal. Four other managers were also indicted in the case, Braunschweig prosecutors said, with charges including one of major fraud.

Public prosecutors in the German city of Braunschweig have brought charges against former Volkswagen CEO Martin Winterkorn over his role in the Dieselgate scandal, they said on Monday. The Braunschweig court, located near Volkswagen’s headquarter in Wolfsburg, said Winterkorn is one of five to be charged over the scandal, which dates back to 2015.

The Dieselgate case was brought to light in 2015 when authorities in the United States discovered so-called defeat device software installed in millions of VW’s diesel vehicles. Winterkorn stepped down from his role as the CEO shortly after the scandal was revealed, as the company was accused of concealing the true level of emissions of the vehicles it exported to the US.

According to RT, the court has accused Winterkorn of a “particularly serious” fraud, saying that he failed to stop the malicious practice. Deutsche Welle reported that Winterkorn was also mentioned for allegedly acting as a “guarantor” to authorities that VW was not selling manipulated vehicles even after he knew about the illegal manipulations.

Specifically, the prosecutor states that Winterkorn approved a software update in November 2014 at a cost of €23 million “which was useless and was designed to continue obscuring the real reason for the increased levels of pollutants in normal vehicle operation.”

The other four defendants in the case have been accused of multiple crimes realized in a single criminal action, including an infraction of the law against unfair competition. The prosecutors said that the defendants could face a prison sentence of up to 10 years. The court also noted that they might have to forfeit any bonuses they had earned from the sales that were based on the manipulation.

Volkswagen has already incurred costs of €29 billion, with almost €13 billion in fines paid to the United States. The company also paid €1.8 billion to Germany and is currently facing charges brought by hundreds of thousands of its customers in the country who want compensation for having bought manipulated vehicles.

Last month, the US Securities and Exchange Commission also announced that it was suing both Volkswagen and Winterkorn. The regulator said that VW and Winterkorn fraudulently raised billions of dollars from investors by overplaying the company’s environmental credentials.

However, many agree that Winterkorn will most likely never face the US courts, as Germany doesn’t extradite its own citizens. The current VW CEO, Herbert Diess, did not comment on Winterkorn’s charges but said that he was not expecting to be named in the case.

“I am not among the accused,” Diess said. “I do not expect to be charged.”

Surprisingly, the company’s shares were not affected by the charges brought against Winterkorn. On the day of the announcement, VW shares went up 1.25 percent and were trading at around €158.

(Banner image: Volkswagen AG/Wikimedia Commons)

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