6 Volkswagen executives indicted in emission scandal
January 11, 2017 4:10 PM
Aaron P. Bernstein/Getty Images
Attorney General Loretta Lynch announces a settlement with Volkswagen in their emissions controversy on Wednesday at the Justice Department.
By Steven Overly / The Washington Post
U.S. officials indicted six executives at German automaker Volkswagen on Wednesday in connection with the company’s scheme to deliberately deceive U.S. regulators about the emissions standards of its diesel engine vehicles and sell those cars illegally to American drivers.
Five of the six executives, at least some of whom were described as high ranking, are currently in Germany. Attorney General Loretta Lynch said it was too soon to say how that will impact legal proceedings moving forward. The sixth executive was arrested and charged in Miami earlier this week.
Additional executives at the company are being investigated and could potentially face charges, Ms. Lynch said.
Volkswagen has agreed Wednesday to plead guilty to three criminal counts, a rare admission of wrongdoing for a major company, and pay $4.3 billion in criminal and civil fines in a settlement with the Department of Justice.
“As you all know we cannot put companies in jail, but we can hold their employees personally accountable and we can force companies to pay hefty fines,” said FBI Deputy Director Andrew McCabe.
“This is really a reflection of the fact that faceless multinational corporations don’t commit crimes, flesh-and-blood people commit crimes,” added Sally Yates, deputy attorney general. “And we’ve sharpened our focus to ensure that we’re doing everything from the very beginning of an investigation … to hold those individuals accountable and build out from there.”
GM and Toyota both incurred steep fines from the Department of Justice in recent years connected to safety defects that caused human fatalities. Neither company faced criminal charges or admitted to wrongdoing. Officials said Wednesday that the Volkswagen case stood out because the deception lasted 10 years and involved senior managers.
“This is a company where lower-level people actually expressed concern along the way about the fact that these defeat devices were being used and questioned whether they should be used, and higher-up people decided to keep using them,” said Assistant Attorney General Leslie Caldwell.
“We don’t really see many major multinational corporations that decide at a very high level … to violate U.S. law in a systematic way for nearly a decade,” she added.
The six executives face one count of conspiracy to defraud the United States and American consumers, and violation of the U.S. Clean Air Act. Those indicted include Heinz-Jakob Neusser, 56, Jens Hadler, 50, Richard Dorenkamp, 68, Bernd Gottweis, 69, Oliver Schmidt, 48, and Jürgen Peter, 59, all of Germany. Mr. Schmidt was arrested and charged earlier this week in Miami.
A spokesman for Volkswagen declined to disclose the employment status of the six indicted individuals, citing a policy not to discuss ongoing investigations or personnel matters.
Hans Dieter Pötsch, who chairs the company’s supervisory board, said in a statement: “When the diesel matter became public, we promised that we would get to the bottom of it and find out how it happened — comprehensively and objectively. We are no longer the same company we were 16 months ago.”
Indeed, Volkswagen shed several top executives and implemented other internal changes after the emissions scandal came to light. The company also apologized to U.S. lawmakers and pledged to regain the trust of American consumers. The Department of Justice said those actions helped the company avoid even steeper penalties.
A judge must now approve the settlement before it’s made official. That court date has not been said, a Department of Justice spokesman said.
Volkswagen is charged with conspiring to defraud the government and violate environmental regulations from May 2006 to November 2015 by installing devices in its diesel engine vehicles that obscure the amount of nitrogen oxide they spew into the air. Those devices and accompanying software allowed Volkswagen to evade regulators for years, the Justice Department asserts.
However, Volkswagen falsely claimed that its vehicles met all environmental regulations in order to import and sell the affected vehicles in the United States from 2009 to 2015, according to the charges. In all, the emissions scandal touched 11 million vehicles worldwide, including more than half a million sold in the United States.
When U.S. officials finally caught on, Volkswagen “did corruptly alter, destroy, mutilate and conceal business records” in order to obstruct the investigation, charging documents declare. In August and September 2015, a Volkswagen supervisor is accused of deleting emails and files related to the deceptive device and instructing employees to do the same, charging documents show.
A portion of the penalty announced Wednesday will settle three civil complaints that it violated environmental, customs and finance laws as part of its deception.
Wednesday’s announcement will bring Volkswagen’s total fines to roughly $20 billion. The largest of those penalties was the $14.7 billion the company was ordered to pay to buyback cars and otherwise compensate customers impacted by the scandal.