Volkswagen has a lot to worry about with respect to its diesel-emissions cheating scandal. On the civil side, it’s already anticipating divvying out $15 billion to make right with regulators, states, and customers over hundreds of thousands of diesel vehicles that contain a software-based cheat allowing them to emit many times the permissible amount of nitrogen oxide.
Then there’s the criminal side of the matter. U.S. Department of Justice investigators have found evidence of criminal wrongdoing in the case, and prosecutors are now holding preliminary discussions with Volkswagen’s lawyers, according to the Wall Street Journal, which cites sources familiar with the matter.
Any settlement on the criminal side of the case likely would top the $1.2 billion levied against Toyota for its unintended-acceleration issues. It also could involve extradition of individuals, as many of those who worked on the emissions hardware and the software strategy live in Germany.
An ongoing Department of Justice criminal probe has involved “multiple individuals,” and includes interviews with current and former employees of the company—and the review of about 1.5 million documents. The results could be quite different than those of the “comprehensive legal review” conducted by the law firm Gleiss Lutz—which looked at internal-investigation information gathered by another firm, Jones Day—that reached the conclusion VW executives weren’t responsible for serious violations.
It’s still unclear whether that might include any of the higher-profile executives that have been implicated with the project, and whether they could still be prosecuted. German prosecutors have launched an investigation into the behavior of former Volkswagen Group CEO Martin Winterkorn (pictured above) based on suspicions of market manipulation and the timing in which investors could have been informed of the issue.
Such a prosecution would be unprecedented for an environmental violation. However, as the WSJ points out, federal prosecutors have charged other automakers with wire fraud and concealing information.
When the U.S. Department of Justice and Volkswagen reach a deal—not likely now until early next year—a so-called “detailed statement of facts” that the automaker made for investigators is expected to be made public. Although we have a feeling that even with the facts clearly laid out, the story itself might still be hazy, and the question of why such deception ever made sense may remain unanswered.
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