Volkswagen (VW) has agreed to pay $4.3 billion in penalties and plead guilty to three felony charges as part of a settlement deal related to its fraudulent diesel emissions scheme.
The VW scandal affected approximately 590,000 vehicles in the U.S. that were rigged with cheating devices designed to deceive federal emissions tests.
The $4.3 billion settlement consists of $2.8 billion in criminal penalties and $1.5 billion to settle civil claims. In addition to the financial penalties, VW will be placed under a three-year probationary period, during which it will be regulated by an independent corporate compliance monitor. The company has also agreed to fully comply with the Justice Department’s ongoing investigation.
The conditions of the plea agreement with the Justice Department require VW to plead guilty to three counts of felony charges:
- Obstruction of justice by destroying documents related the scheme
- Participating in a conspiracy to defraud the U.S. government and its U.S. customers and to violate the Clean Air Act by lying and misleading the Environmental Protection Agency about whether certain VW, Audi and Porsche diesel vehicles complied with U.S. emissions standards
- Using cheating software to evade the U.S. testing process and hiding material evidence about its cheating from U.S. regulators
VW is also being charged with a separate crime of importing vehicles installed with deceptive software into the U.S. by means of false statements about the vehicles’ fulfilment of U.S, emissions limitations.
In addition to these charges, a federal grand jury in the Eastern District of Michigan indicted six of the company’s executives and employees for their role in the decade-long conspiracy.
The suspects, all German nationals, have been charged with one count of conspiracy to defraud the U.S. and VW’s U.S. customers and to violate the Clean Air Act. Additional charges of wire-fraud have been filed against four VW executives, while four others are being charged with violations of the Clean Air Act.
One of the indicted VW executives was arrested on Jan. 7, 2017 in Miami while visiting the U.S. and appeared in a federal court on Jan. 9. The rest are presumed to still reside in Germany.
The scandal emerged in 2015 when it was discovered that VW’s “clean diesel” vehicles had been installed with emissions cheating devices.
The scheme began in 2006 and affects VW, Porsche and Audi models with 2.0 and 3.0-liter diesel engines that were manufactured between 2009 and 2016.
During testing, the vehicles released emissions that were compliant with U.S. regulation standards. However, when the vehicles were driven on highways, the cheating software turned off, allowing vehicles to emit almost 40 times the allowable emissions limit.
A federal judge has already agreed to a settlement between VW, the federal government and U.S. consumers in an October 2016 ruling that is separate from the current plea deal.
That deal will require VW to pay as much as $10 billion to buy back or repair affected vehicles and to pay approximately $5 billion for environmental remediation.
If you own a vehicle that was affected by the VW emissions cheating software, contact Greg Coleman Law’s Volkswagen emission attorneys today for a free consultation to discover if you are able to participate in a lawsuit.
Call (865) 247-0080 if to find out how a VW lawsuit can help you.