Volkswagen staff, supplier warned of emissions test cheating in 2011: German …

28 Sep 2015 | Author: | No comments yet »

German regulators seek VW plan to fix ‘cheating’ engines.

Those are among the questions that state and federal investigators want answered as they plunge into the emissions scandal at Volkswagen, which has cost the chief executive his job, caused stock prices to plummet, and could result in billions of dollars in fines.Germany’s car regulators have asked Volkswagen to provide a plan by October 7th in relation to when its vehicles will meet national emissions requirements, after the firm admitted cheating on US air-pollution tests.

Volkswagen’s own staff and one of its suppliers warned years ago about software designed to thwart emissions tests, two German newspapers reported on Sunday, as the automaker tries to uncover whether its executives knew about the cheating. Legal experts say the German automaker is likely to face significant legal problems, including potential criminal charges, arising from its admission that 11 million of its diesel vehicles sold worldwide contained software specifically designed to help cheat emissions tests. The Federal Motor Transport Authority sent a letter to VW requesting a “binding” programme and schedule for a technical solution, German Transport Minister Alexander Dobrindt said yesterday.

Europe’s biggest automaker is adding up the cost of the biggest business scandal in its 78-year history, having acknowledged installing software in diesel engines designed to hide their emissions of toxic gasses. The Environmental Protection Agency has accused VW of installing sophisticated stealth software that enabled ‘‘clean diesel’’ versions of its Passat, Jetta, Golf, and Beetle models to detect when they were being tested and emit less-polluting exhaust than in real-world driving conditions. Volkswagen will present a plan in the coming days for how it will fix its affected vehicles and will notify customers and relevant authorities, Peter Thul, a spokesman, said. The agency says the ‘‘defeat devices’’ allowed those models to belch up to 40 times the allowed amounts of harmful fumes in order to improve driving performance. ‘‘If there is sufficient evidence to show that Volkswagen intentionally programmed its vehicles to override the emission control devices, the company and any individuals involved could face criminal charges under the Clean Air Act, and for conspiracy, fraud, and false statements,’’ said David M. The Frankfurter Allgemeine Sonntagszeitung, citing a source on VW’s supervisory board, said the board had received an internal report at its meeting on Friday showing VW technicians had warned about illegal emissions practices in 2011.

He called criminal charges ‘‘almost certain.’’ But Uhlmann cautioned that hauling the executives involved into a US courtroom could be challenging, because much of the conduct at issue probably occurred overseas. Separately, Bild am Sonntag newspaper said VW’s internal probe had turned up a letter from parts supplier Bosch written in 2007 that also warned against the possible illegal use of Bosch-supplied software technology.

While the United States has an extradition treaty with Germany, European regulators also are investigating and could claim first dibs on prosecuting company officials. Volkswagen declined to comment on either report. “There are serious investigations under way and the focus is now also on technical solutions” for customers and dealers, a Volkswagen spokesman said. “As soon as we have reliable facts we will be able to give answers.” A spokesman for Bosch said the company’s dealings with VW were confidential. Bild said Martin Winterkorn, who quit as Volkswagen chief executive last week, was demanding his salary for the rest of his contract to the end of next year but the board did not want to pay it.

In July 1973, the agency found that VW had installed temperature-sensitive devices that turned off emissions controls on about 25,000 Fastback, Squareback, and bus models. Investigators will almost certainly look for any false statements made to the EPA and for signs that VW has tried to conceal wrongdoing or obstruct regulators. The transport ministry said the KBA had written to VW demanding it “commit to concrete steps and a timetable” to ensure its cars in Germany meet requirements. And money laundering allegations will be explored if investigators suspect that VW sent illicit proceeds overseas. ‘‘If a software package such as this were intentionally designed to defeat the emissions testing, there may well be e-mail traffic, meetings, records that would establish that intent,’’ said Gregory Linsin, a former environmental crimes prosecutor at the Justice Department. We will inform the KBA about what we are doing and the talks are occurring on the highest level.” “If a global player from Germany violates environment protection rules that blatantly, this casts a shadow on the environment pledges of German companies,” she told Handelsblatt newspaper in an interview to be published on Monday.

The last two major criminal investigations against auto companies — Toyota and General Motors — yielded massive fines over car safety problems but have resulted in no prosecutions of executives. Those outcomes dismayed consumer watchdog groups and grieving victims’ relatives, who demanded better accountability for failure to disclose vehicle defects. A memo this month by Deputy Attorney General Sally Yates sought to reaffirm the Justice Department’s commitment to prosecuting employees and executives, directing among other policy mandates that corporations pushing for credit for cooperating with the government must first turn over evidence against individuals. ‘‘Volkswagen has a fundamental choice to make,’’ said Uhlmann, the former prosecutor. ‘‘That is whether it intends to cooperate and seek leniency, or whether it wants to fight the charges.

Volkswagen and other European manufacturers have promoted “clean diesel” technology, benefiting from diesel’s fuel economy but meeting stringent tests for emissions of toxins. But the suggestion that this was achieved by cheating on tests could affect the viability of the entire diesel sector and the fate of companies that have bet on it. (Reporting by Steve Scherer, Andreas Cremer, Jonathan Gould, Patricia Uhlig and Michael Nienaber; Writing by Jonathan Gould and Peter Graff; Editing by Jon Boyle)

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